The US dollar has been a touchy-feely subject lately.
The world reserve currency stands on shaky grounds. FED's money printer is still roaring louder than Ultra Music Miami. Experts have warned us about the hangover of excessive money printing since the first stimulus check made its way to your account.
What do all these warnings mean you've been hearing all year round?
The value of your money will plummet, or you'll have less money in the wake of rising interest rates.
Let's unpack this statement.
Inflation eats everything
Inflation has been shared in the spotlight with COVID-19 when it comes to hot topics of the 2020s.
Interest rates are zero, which means that getting money is cheap. The big problem here is that everyone can raise money. And when everyone can raise money, that means that the value of that money is not as great as it used to be.
Your dollar goes one mile less. But you'll have more dollars if inflation continues this way.
FED's job is to maintain stable prices and balance the value of your money. They're doing a thankless job of keeping the economy running. So, we're entirely in the hands of the people working at the Federal Reserve. At this point, we need a miracle to escape a total economic disaster.
Inflation surged to 6.8%, the fastest rate since 1982.
Housing boom and bust
The housing market is "nuts and getting worse," said Barbara Corcoran for Yahoo Finance.
The abundance of cash has fueled a spike in real estate prices. Florida home prices rose 23.9% in 2021. The available money in the system and low-interest rates are fueling the wild demand. To spice things up, Florida is experiencing a shortage of available homes, and extreme weather is doing rounds on the already existing real estate.
If you're a millennial looking to buy your first Miami home, you can either:
1. Forget about it.
2. Or pay more than the overpriced asking price to win the bidding war.
Both options sound horrible.
Shaky stock market
Stock markets are enjoying unprecedented growth.
Similar to the housing market, the abundance of cheap money is fueling the explosion of stock prices. The S&P 500 index rose 27% in 2021, wrapping up a third consecutive year of double-digit gains.
Taking into account that the employment rate has not yet recovered and that many people simply don't work, these stock gains are hardly justified. The economy has been dealing with major issues all year round, so the stock market lies on shaky grounds.
Unlikely events are becoming more likely, especially in Florida. One-in-a-hundred-year storms are becoming more common. Parts of the great Sunshine State are running dry. And many are bracing for off-season extreme weather events. From hurricanes ripping through the Sunshine state to devastating floods destroying your floors, one major event can erase your entire savings account.
Are you worried your money won't be enough to buy maintain your lifestyle in 2022
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