Today there has never been so many factors affecting the economy all at once – and many of these are pushing us in different directions. We have discussed many of these previously. First and foremost, we have COVID. The recession was COVID-induced, and our recovery depends upon the pace of vaccinations and the rise of the Delta variant.

The pandemic also brought us record low interest rates and a subsequent fire-sale on housing. Housing has been hot, and this strength has helped the economy add jobs rapidly on the other side of the equation. The strength of the recovery has also been characterized by supply shortages which has ignited inflation. We have termed this inflation as transitory, as many feel that this inflation will soften as the shortages ease during the recovery.

Let’s add one more factor—the change in weather. Climate change is certainly affecting our economy. From raging wildfires to droughts and intense storms, each year the weather events seem to be getting worse. You can’t have millions of acres destroyed each year without negatively affecting the economy. Thus, there are many factors pulling the economy in different directions. The Fed will have a tough time trying to decide when to remove support from the recovery. In the meantime, we would not be surprised to see additional volatility in the markets as this situation unfolds.

Dave Hershman is the top author in the mortgage industry. Dave has published seven books, as well as hundreds of articles and is the founder of the OriginationPro Marketing System and Mortgage School. Want to send this commentary and other news in a personalized format to your sphere database or on social media?  Sign up for a free trial at