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“I feel anxious about inflation every time I go to the grocery store,” Caroline Fitzsousa, a bar manager in Baltimore, Maryland, told VOA. “And at work, my customers aren’t happy either. The rising cost of food and liquor caused us to raise prices. People are frustrated having to pay more for the same items they’ve always ordered.”

That frustration was felt across the United States in 2022, as global supply chain disruptions, Russia’s invasion of Ukraine, stimulative U.S. fiscal policies and other factors contributed to the highest inflation levels – and the biggest price increases for many goods and services – America has seen in four decades.

Inflation peaked in June when the consumer price index, a measure of the average change in the cost of goods and services compared to the year before, rose 9.1%. For October, the index was 7.7% higher, which economists saw as an improvement but still stubbornly high. 

The U.S. Federal Reserve aims for 2% annual inflation and has been aggressively raising interest rates in hopes of bringing it under control.

For consumers and businesses alike, the impact of rising prices and falling purchasing power has been plain to see.

“There are some nights that seem as busy as before the pandemic,” Fitzsousa said, commenting on her bar’s ability to attract customers, “but there are also plenty of patches of time when the bar is dead because people can’t afford to eat and drink out as much.”

She added, “You hear people complaining about places being overpriced, but there’s nothing we can do. If we’re going to recover from the pandemic’s losses and keep our doors open, this is what we have to charge. Things just cost more this year.”

Year of worry

A November survey conducted by U.S. News & World Report and The Harris Poll reported that 86% of U.S. adults were either very or somewhat concerned about the economy and inflation.

And, with the holiday shopping season under way, 41% of American consumers plan to spend less this year than they did in 2021, according to a CNBC All-America Economic Survey.

“In most current polls, you’ll see Americans rank higher prices and the economy as the country’s biggest problem,” said Robert Collins, professor of urban studies and public policy at Dillard University in New Orleans, Louisiana. “It ranks ahead of crime, border security, the environment, abortion, and everything else. The economy is top of mind.”

Despite it being a priority, Collins said this isn’t a challenge that can be solved quickly. Inflation takes time to go down, he warns, and relief will be slow and incremental.

For many Americans, such as Steve Ryan, an investor and professional poker player living in Las Vegas, Nevada, however, the need for relief is urgent. 

“I’m honestly worried about my ability to continue to afford living here,” he told VOA. “The stock market stagnated and it doesn’t seem like it’s going to rebound any time soon, but I have to sell my shares at rock bottom prices because I need to cobble together money just to afford my rent.”

And that rent, unfortunately, is rising. Ryan had to leave his apartment of more than a decade because the price nearly doubled after renovations were made. 

“I found a new place,” he said, “but it definitely costs more. And I’m paying for it while making less than I used to. At some point, I may just have to leave.”

Complicated economy

“It’s important to remember that the economy is very complex and very cyclical,” said Collins of Dillard University. “One of the things that caused the inflation we’re seeing now is the low unemployment rate most workers see as a good thing.”

In November, the economy added 263,000 jobs, keeping the national unemployment rate at 3.7%, which is near a half-century low.  

Robust job creation is usually associated with an expanding, vibrant economy. But finding workers to fill those jobs has been a challenge for many employers over the last two years.

“I love that workers are gaining more power,” said Fitzsousa in Baltimore, “but we’re having a tough time attracting the staff we need to run our business because there are less people to choose from and more jobs competing for them. As a small business our profit margins are so thin. It’s hard to keep pace with the higher wages corporate restaurant groups can pay to bring in workers.”

As employers offer higher wages to attract workers, the increased labor costs usually are passed down to consumers in the form of higher prices.

“Unfortunately, the increased wages workers are receiving aren’t keeping up with the inflation it’s helping to fuel,” explained Patrick Button, associate professor of economics at Tulane University in New Orleans.

That’s been the case for Lisa Martin, a teacher in Cincinnati, Ohio, whose dream of home ownership has been put on hold.

“Rent is so expensive and I know buying a house is a smart move,” she told VOA. “It’s a goal of mine, but my income isn’t high enough to allow me to save for a mortgage. I’m hopeful this year prices might come down a little.” 

Looking ahead

As the Federal Reserve keeps boosting interest rates, the heads of some large U.S. banks warn a recession could loom in 2023. 

“Those things might very well derail the economy and cause this mild to hard recession that people are worried about,” JPMorgan Chase & Co.’s chief executive, Jamie Dimon, told CNBC earlier this week.

It’s a worry for millions in this country, especially Americans nearing retirement.

“I feel the economy has affected those of us preparing for retirement in a big way,” 62-year-old Lisa Ash of Mandeville, Louisiana, told VOA. “Our lifelong savings – whether in the stock market or in our savings accounts – have taken a big hit and I don’t see that correcting itself in the next three years.”

She added, “I’m no longer thinking about buying another home or about traveling. I’m working.”

For all the gloom, some financial experts have a simple message: hang in there.

“Throughout history the economy expands and the economy contracts; business peaks and business troughs,” said Marigny deMauriac, a certified financial planner in New Orleans. “It’s called a cycle because it’s happened before and it will happen again. There might be some pain next year in the case of a recession, but the sooner there is pain, the sooner there will be relief.”
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Stocks tumbled on Wall Street and across European markets Thursday as investors grew increasingly concerned that the Federal Reserve and other central banks are willing to risk a recession to bring inflation under control.

The S&P 500 fell 2.5%, with more than 90% of stocks in the benchmark index closing in the red. The Dow Jones Industrial Average fell 2.2%, and the Nasdaq composite lost 3.2%. The broad slide erased all the weekly gains for the major indexes.

European stocks fell sharply, with Germany’s DAX dropping 3.3%.

The wave of selling came as central banks in Europe raised interest rates a day after the U.S. Federal Reserve hiked its key rate again, emphasizing that interest rates will need to go higher than previously expected in order to tame inflation.

“It’s this coordinated central bank tightening — stocks tend to not do well in that environment,” said Willie Delwiche, investment strategist at All Star Charts.

In the U.S., the market’s losses were widespread, though technology stocks were the biggest weight on the S&P 500. The benchmark index fell 99.57 points to 3,895.75.

The Dow slid 764.13 points to 33,202.22, while the tech-heavy Nasdaq dropped 360.36 points to 10,810.53.

Small company stocks also fell. The Russell 2000 index slid 45.85 points, or 2.5%, to close at 1,774.61.

The Fed raised its short-term interest rate by half a percentage point on Wednesday, its seventh increase this year. Central banks in Europe followed along Thursday, with the European Central Bank, Bank of England and Swiss National Bank each raising their main lending rate by a half-point Thursday.

Although the Fed is slowing the pace of its rate increases, the central bank signaled it expects rates to be higher over the coming few years than it had previously anticipated. That disappointed investors, who hoped recent signs that inflation is easing somewhat would persuade the Fed to take some pressure off the brakes it’s applying to the U.S. economy.

The federal funds rate stands at a range of 4.25% to 4.5%, the highest level in 15 years. Fed policymakers forecast that the central bank’s rate will reach a range of 5% to 5.25% by the end of 2023.

Their forecast doesn’t call for a rate cut before 2024.

The yield on the two-year Treasury, which closely tracks expectations for Fed moves, rose to 4.24% from 4.21% late Wednesday. The yield on the 10-year Treasury, which influences mortgage rates, slipped to 3.45% from 3.48%.

The three-month Treasury yield slipped to 4.31% but remains above that of the 10-year Treasury. That’s known as an inversion and considered a strong warning that the economy could be headed for a recession.

“The [stock] market’s reaction is now factoring in a recession and rejecting the possibility of the ‘soft/softish’ landing” that Fed Chair Jerome Powell raised in a speech last month, said Quincy Krosby, chief global strategist for LPL Financial.

The prospect of more Fed rate hikes have heightened Wall Street’s worries about how company earnings could fare in a recession, Delwiche said.

“[Inflation] has peaked. It will peak. It did peak — whatever. That’s not the story,” he said. “The story now is how does the economy hold up? How do earnings hold up?”

The central bank has been fighting to lower inflation at the same time that pockets of the economy, including employment and consumer spending, remain strong. That has made it more difficult to rein in high prices on everything from food to clothing.

On Thursday, the government reported that the number of Americans applying for unemployment benefits fell last week, a sign that the labor market remains strong. Meanwhile, another report showed that retail sales fell in November. That pullback followed a sharp rise in spending in October.

Like the Fed, central bank officials in Europe said inflation is not yet corralled and that more rate hikes are coming.

“We are in for a long game,” European Central Bank President Christine Lagarde said at a news conference.
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Botswana’s government says rural communities have earned $5 million since last year from the proceeds of elephant hunting. Conservationists object to the practice, but local officials say the hunts are necessary to reduce human-wildlife conflict. The annual activity attracts hunters from overseas who pay huge sums to shoot elephants.

Acting Minister of Environment and Tourism, Sethabelo Modukanele, said communities are benefiting following the lifting of a five-year hunting ban.

“Hunting was reinstated in 2019 following a five-year moratorium after extensive stakeholder consultation. This allowed communities to generate considerable revenues amounting to 50 million pula over two years [from 2021 to 2022] for their development projects,” said Modukanele.

Most of the revenue is from international hunters who pay up to $50,000 to shoot a single elephant.

Botswana Wildlife Producers Association chief executive, Isaac Theophilus, says more could be done to ensure communities benefit from wildlife resources.

“Communities can make more from hunting. The problem right now is that communities only depend on selling their hunting quotas, subleasing some of the areas allocated to them. In order to gain more from hunting, communities have to explore other avenues of trying to raise funds, like investing the P50 million that they have accrued into income generating activities,” said Theophilus.

Botswana’s growing elephant population, at more than 130,000, has created conflict with humans, as the animals often trample crops, injure or kill people.

But animal biologist Keith Lindsay said elephant hunting could hurt the species’ breeding patterns.

“The biggest male elephants are the ones that contribute most of the population in terms of survival and mating success. Their genes are actively selected and chosen by female elephants; they prefer mating with the biggest males. By taking away those big males, you are damaging the population’s genetic structure and survival chances in the future,” he said.

Meanwhile, Minister Modukanele said the government has distributed nearly 400 wild animals to small-scale farmers to ensure locals have a stake in agro-tourism.

“Government made a deliberate decision to support start-up ventures for Batswana who showed interest and met the requisite criterion for keeping of game in plowing fields. Those who qualified were assisted with animals of various species, such as impala, gemsbok, eland and zebra. To date, 277 have applied and 251 approved and 67 provided with seed stock, totaling 377 animals,” said Modukanele.

At a recent meeting of parties to CITES, the 1963 treaty to protect endangered species, some African countries tried to present a proposal seeking to ban trophy hunting in Botswana and other southern African elephant ranges.  The attempt was unsuccessful, and elephant hunting will continue in Botswana for the foreseeable future.   
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