The Influence of Inflation

Eagle Wealth Management |


What do The Dukes of Hazzard, M*A*S*H, and The Love Boat all have in common?  They were top-rated television programs in 1982; the last time inflation was hovering in the 7%–8% range.

When inflation is running hot, you can feel its overreach in almost every corner of the economy.  People see it when they buy gas at the grocery store, but its influence touches mortgage rates, credit card debt, and overall consumer confidence.

Managing inflation is the job of the Federal Reserve, and the Fed’s approach with monetary policy reflects its near single-minded focus on higher prices in 2022.  The Fed raised short-term interest rates at its March meeting, and Fed Chair Powell signaled more is needed before the Fed can wrestle control of inflation.

It may be only a matter of time before the Fed’s policies temper inflation.  Some see a change in the second half of the year, while others say 2023 is more likely.  But in the months ahead, it’s possible inflation reports will bring back memories of Laverne & Shirley and Magnum, P.I.

If you’re feeling an inflation pinch and want to discuss your monthly budget, please reach out.  In the meantime, our team will monitor the situation and keep you updated if we believe any portfolio changes are needed.

Best regards,
Your Eagle Wealth Team

It’s Tax Day!  Be on the Lookout for Tax Scams.

While today might be Tax Day, please keep in mind that tax scams are prevalent right now.  Criminals running phishing scams will impersonate the IRS or other federal agencies in an attempt to steal your money or identity. These messages may contain alarming language that pressures you into sharing your information. If you’re unsure if a message you’ve received is legitimate or fraudulent, here are some red flags to watch out for.

Asks for Personal or Financial Information
The IRS will never initiate contact with you via email, phone, text, or social media asking for personal or financial info. If they do initiate contact, it will be by mail through the U.S. Postal Service.  There are some circumstances where the IRS will call or come to your home or business, but generally, you’ll receive several notices in the mail first.

If you receive a phone call or email asking for your information, do not respond.  Scammers may attempt to use your identity to file a tax return in your name or cause other financial hardships.  Instead, check the IRS website to learn the best way to report the message.

Attempts to Look “Legitimate”
Fraudulent emails will go to great lengths to appear like the real thing.  They may use a federal agency’s logo or watermark and style the message to look like an official email.  If you receive a suspicious email, do not click any links or open any attachments. The same applies to text and social media messages.

Phone scammers can mask their caller ID to look like an IRS office or other federal agency.  The caller may also provide a fake badge number to seem more legitimate.  If this happens, take a note of the badge number so you can add it to your report.

Creates a Sense of Urgency
Phone scammers usually leave pre-recorded voicemails that ask you to call back immediately.  These messages often contain threats to bring in law enforcement if you don’t respond.  Scammers may also pressure you to pay over the phone and ask for credit or debit card numbers, gift cards, or wire transfers.

Please note the IRS will never ask for payment over the phone.  Generally, they will send you a bill in the mail.  Also, as part of your rights as a taxpayer, the IRS allows you to question or appeal your owed amounts.

Have you received a suspicious message claiming to be the IRS?  Here’s what to do:

  • If it’s a phone call, hang up and do not give them your personal information
  • If it’s an email or text, do not reply to the message.  Don’t open any links or attachments
  • Make a note of the date and time you received the message
  • Report the message to the IRS:

To learn more about different phishing schemes, visit the IRS website.  

The Week on Wall Street

Stocks posted losses in a holiday-shortened trading week as the first-quarter earnings season kicked off and investors digested new inflation data.

The Dow Jones Industrial Average declined 0.78%, while the Standard & Poor’s 500 fell 2.13%. The Nasdaq Composite index dropped 2.63% for the week. The MSCI EAFE index, which tracks developed overseas stock markets, lost 1.20%.1,2,3

Watching Bonds

Stocks began the week moving lower as bond yields climbed higher, with growth stocks suffering some of the steepest declines. Investors considered China’s ongoing lockdown warily, worried it might worsen supply-chain issues.

Historically high consumer and producer price inflation reports were shrugged off by the stock and bond markets in the main, with bond yields slipping despite the hot inflation numbers. Despite an encouraging start to the first-quarter earnings season, stocks pulled back on Friday as bond yields resumed their move higher ahead of a three-day holiday weekend.

An Eye on Inflation

On Tuesday, March’s Consumer Price Index (CPI) report offered little indication that inflation may be moderating, as prices increased 8.5% year-over-year, the fastest pace in 40 years. Core inflation, excluding food and energy prices, recorded a 6.5% jump, the steepest rise since August 1982. One encouraging note was that core inflation showed potential signs of ebbing, posting a monthly increase of 0.3% versus expectations of a 0.5% increase.4

The following day, March’s Producer Price Index, a potential insight into future inflation, rose 11.2% year-over-year. A March survey by the National Federation of Independent Business released earlier in the week, indicated that half of the respondents were likely to raise prices in the next three months.5




Tuesday: Housing Starts.
Wednesday: Existing Home Sales.
Thursday: Jobless Claims. Index of Leading Economic Indicators. 
Friday: Purchasing Managers’ Index (PMI) Composite Flash.

 Source: Econoday, April 14, 2022
The Econoday economic calendar lists upcoming U.S. economic data releases (including key economic indicators), Federal Reserve policy meetings, and speaking engagements of Federal Reserve officials. The content is developed from sources believed to be providing accurate information. The forecasts or forward-looking statements are based on assumptions and may not materialize. The forecasts also are subject to revision.



Monday: Bank of America Corporation (BAC), J.B. Hunt Transport Services, Inc. (JBHT).
Tuesday: Netflix, Inc. (NFLX), Johnson & Johnson (JNJ), International Business Machines Corporation (IBM), Lockheed Martin Corporation (LMT), Prologis, Inc. (PLD).
Wednesday: Tesla, Inc. (TSLA), The Procter & Gamble Company (PG), Lam Research Corporation (LRCX), CSX Corporation (CSX).
Thursday: AT&T, Inc. (T), United Airlines Holdings, Inc. (UAL), Snap, Inc. (SNAP), Blackstone, Inc. (BX), Union Pacific Corporation (UNP), Dow, Inc. (DOW).
Friday: Verizon Communications, Inc. (VZ), American Express Company (AXP), KimberlyClark Corporation (KMB). 

Source: Zacks, April 14, 2022
Companies mentioned are for informational purposes only. It should not be considered a solicitation for the purchase or sale of the securities. Investing involves risks, and investment decisions should be based on your own goals, time horizon, and tolerance for risk. The return and principal value of investments will fluctuate as market conditions change. When sold, investments may be worth more or less than their original cost. Companies may reschedule when they report earnings without notice.