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Oakland, CA | Piedmont; High Oil Prices and Rising Interest Rate Environment

SYNOPSIS: Financial planning during high oil prices and rising interest rate environment and a general feeling of unsafety in the consumer markets makes for difficult financial situations.

First and Main Financial June 12th, 2022

BY: ALISON VAN DYKE, FIRST AND MAIN FINANCIAL

Hi, I’m Erik Wolfers, founder and managing member of First and Main Financial. We’ve been helping clients with perfectly personalized financial solutions since 2001. Today, I want to give just a little bit of an update on the markets.

Periodically, we go through very challenging economic times. Sometimes there are fears that drive markets lower but for not very long, and sometimes there are challenges in the economy which take a while to work out —we always have come through them.

A recession is defined as two consecutive quarters of contraction or negative growth, sometimes people like to say. We are currently faced with several decades high inflation. There are a number of contributing factors: the price of oil started rising all the way back in October of 2020 and it’s pretty much kind of just gone up since then. The global conflict that is still underway is of course contributing to even higher oil prices. We need low oil prices so that the economy can function. The lower oil is priced or energy is priced, the better the economy can function, especially for people that are in lower earning areas and where people are poor and relatively impoverished around the globe globe. Low priced oil is good and unfortunately we do need it for several decades to come, until we have more reliable and robust renewable energy sources.

Going into the pandemic we had a very strong economy, and then coming out the economy is still strong and labor markets are tight, which also contributes to inflation—and global supply chains, as we’ve all heard, are still not functioning properly.

Inflation is not good, it erodes purchasing power, especially for people who are lower earners or especially those on a fixed income—pensioners, as some people say. The Federal Reserve is raising interest rates but inflation didn’t really come down from one month to the next recently. We’ll see what happens as the FED keeps raising interest rates. Markets are supressed or subdude and we are still in a wait-and-see moment, but hopefully within just a few months things will clear up or look somewhat better—but for now markets are depressed and we’ll be looking. If there is a harder selloff, we’ll be buyers.

If you are looking for some financial guidance; whether for a one time financial plan or continuing advice on your investments, we invite you to meet with a First & Main Financial planner for a free consultation. We would be more than happy to sit down with you, assess your situation and review our services to help navigate your financial future.

Thank you,

Erik S. Wolfers, MBA, CFP®

“Best Financial Advisor in Piedmont, CA”

Top Rated Local Financial Advisor / Planner

East Bay Area: Piedmont, Oakland, Berkeley, Alameda, Orinda, CA

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“Best Financial Advisor in Piedmont, CA”

Top Rated Local Financial Advisor / Planner

East Bay Area: Piedmont, Oakland, Berkeley, Alameda, Orinda, CA

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ALISON VAN DYKE

FIRST AND MAIN FINANCIAL

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235 Wildwood Avenue,
Piedmont, CA 94610, USA

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ABOUT THE AUTHOR

BIO: At First & Main Financial, Alison Van Dyke helps clients with their financial lives. She has worked in Corporate Finance for Bank of America and Chase Manhattan Bank. Alison is pursuing the CFP® certification; she received her MBA at Georgetown and her B.A. in Political Science from UCLA.

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Oakland, CA | Piedmont; High Oil Prices and Rising Interest Rate Environment