51. The State Of The Economy: Where Inflation Is Headed In 2022 With John Horn


Economies worldwide are facing some of the most unpredictable times, much of it due to the ongoing the pandemic. To help you navigate the economy in the upcoming year is John Horn, Professor of Practice of Economics at the Olin Business School at Washington University in St. Louis. He joins Jim Pfeifer to shed light on the current state of the country’s economy with a focus on inflation. The pandemic has undeniably boggled multiple economies and has had cascading effects with supply chain issues, reductions in the workforce, the wage-price spiral, and more. Tune in as John breaks down and entertains different possibilities for the economy in 2022 and beyond.

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The State Of The Economy: Where Inflation Is Headed In 2022 With John Horn

I’m pleased to have John Horn with us. He is a Professor of Practice and Economics at the Olin Business School at Washington University in St. Louis. He joins us to talk about the state of the economy, inflation, and other factors that could affect investors in 2022 and beyond. John, welcome to the show.

Thanks so much, Jim.

The way we like to start out is to get a little bit of background on you. If you could tell your story, your background, and how you got to where you are., that would be great.

I got my PhD in Economics, and then worked as a consultant for close to about fifteen years, and then transitioned over to teaching at the business school at Washington University in St. Louis. I teach Microeconomics, Macroeconomics, and International Economics to MBA students exclusively.

That’s why I wanted you on here to talk about the economy. It’s the beginning of 2022 and people are interested in what’s going to happen, especially this time of year in the way things are with a pandemic, inflation, and all that. I’d like to start out if you can talk to us a little bit about inflation, a little bit of background on where we are currently, and maybe where you see us going.

The latest numbers came out and they showed that inflation was the highest it’s been since the real inflation crisis we had back in the late ‘70s, early ‘80s when inflation was about almost twice the level it is nowadays. The last numbers came out and it was a 7% year over year increase. Normally, we’ve been averaging about 1.5% to 2% inflation year over year, so it’s a significant increase. Most of your audience have observed that at the grocery store or the gas station.

Inflation has gone up for a couple of reasons. Most economists aren’t quite sure yet exactly what the right answer is because we don’t have enough data to estimate. Things like the pandemic have caused supply chain crunches and reductions in the workforce and the inability to provide demanded goods and services. People who are using the stimulus money to go buy extra things have led to some increase in demand coupled with the reduction in supply, that’s increased prices.

We’ve seen it especially in other countries that have shut down production because of COVID. Even if you could get the supply chain moving, there’s nothing at the beginning that produces the good. There are lots of different reasons which have been given for why inflation is going up. For most of them, they are tied to the pandemic. That’s why a lot of economists still believe that this isn’t something systemic that would continue in the economy unchecked, other than the fact that inflation is tricky.

Once people believe inflation is going to be the norm, then that starts getting baked into wage demands and price increases across the board, and it’s hard to undo that. That’s the challenge that the Federal Reserve is facing right now. The latest estimates and most people believe there’s going to be 3% to 4% interest rate increases. Interest rate increases slow down the economy. It’s harder to borrow money, harder to invest in new opportunities, and harder for people to consume durables like cars, houses, and other big purchase investments.

That slowing down the economy reduces the pressure on inflation but also slows down the economy. The trade-off that the Fed is trying to manage is how do we slow inflation without slowing down the economy. I don’t envy them in their position because if supply chains unwind themselves by September, early in fall, at the same time they’re raising rates, that could be a problem for the economy.

On the other hand, if there’s a new variant that comes out every 3, 4 months and continues to halt the economy, that could slow the economy down further. Interest rate hikes on top of that would slow the economy down even more, which would be a problem. Why do we have inflation? The simple answer is from most of the drivers that people have talked about and economists can point to, if we hadn’t had the pandemic, we probably wouldn’t be seeing the inflation we’re seeing right now. That’s the bottom line.

Inflation is the highest it’s been since the real inflation crisis we had back in the late seventies.

If the pandemic reduces its effect, then we would expect inflation to also go back to long-term normal.

Except and unless people believe that the new normal is 6% to 7% inflation, in which case that gets baked into wage demands, wage expectations. If that gets baked into wage expectations, then employers have to start raising prices by 6% to accommodate those wage increases, which then people say, “Prices are going up by 6% and your 6% wage.” The employers say, “I’ll give you the raise, but now I got to raise the price by 6%.” That’s what’s called the wage-price spiral.

Once that sets in, it’s hard to break unless you essentially cause a recession. That’s what the Federal Reserve did back in the early-‘80s. When inflation was 12%, 13%, 14%, they essentially forced a recession to reset everyone’s mind to know that’s not the norm. What the Fed is trying to balance now is how do we slow down inflation without having that big massive shock of another recession.

I’d like to talk about the expectation thing a little bit because that’s hard for me to grasp. I get what you’re saying if everyone’s going to their employer and saying, “Look at all this inflation. I need a higher wage.” From past data, was that a verified thing that happens, the expectation bakes in the actual inflation and causes it to an extent?

The simple answer is yes, it has. This is why I still fall on the side of, “I don’t think this is going to be the systemic way that the economy will move going forward.” A lot of the places where you see wages going up are jobs where employees said, “This is an awful job.” There are so many companies and industries that demand workers, “I’m going to go somewhere else because I can get a job somewhere else.”

In the long run, eventually, we’re going to settle out to the place where you’re going to have to hire people to be waitstaff at a restaurant, stock shelves at the grocery store, and those other jobs that people are now leaving because there are other opportunities. I was reading that some of the lower-end manufacturing are struggling to find people to work. For a long-time, manufacturing was the job to get for the middle class. It’s that long, grueling hours and they’re like, “There are better opportunities out there.” The economist side of me says, “Eventually, those will all balance out.”

In the past, a lot of those wage increases were baked into union contracts. If inflation went up by 5%, we got a 4.5% to 5% raise. Nowadays, so many fewer workers are covered by those types of contracts that I have a hard time seeing workers continually be able to say, “I need a 5%, 6%, 7% wage increase,” when the market settles out after COVID. We have a more steady state of available jobs and people looking for jobs like we had up until 2020.

If you don’t have that union contract, if you don’t have it baked into the contract where you automatically get that wage increase, unless we have a continually tight labor market, it’s going to be hard for workers to have the ability to say, “I need that wage or I don’t work here.” The one thing favoring that is that we are at the beginning wave of the Baby Boomer retirement. A lot of what we’ve seen in terms of the reduction in the labor force in the last few years is Baby Boomers are saying, “We’re done. Why keep pushing it?”

If that ramps up and keeps going, then we could have a continuing tight labor market for the next several years and you could see that wage-price spiral play out. Have we seen it before? Yes, more often in union contracts around the ‘70s and ‘80s when that spiraled the inflation. I’m a little bit more skeptical that that ability of workers to have the power to raise wages will go forward unless we see a huge reduction in the Baby Boomers saying, “We’re not going to have part-time jobs. We’re not going to reengage in the labor force. We’re done.” You could see a labor shortage and that would lead to higher wages.

It’s hard to understand how all this works together. That’s why your job is so difficult. If the Fed tries to raise rates, then that causes the stock market to drop as it did in 2018 when they tried to raise rates. Let’s say you’re right and the Boomers are like, “I’m done.” A bunch of them start retiring a little bit earlier than they should have or wanted to and then you have a stock market decline, then a lot of their wealth is going to erode and maybe they come back. How do you analyze all of that? It seems so complicated to figure out and make predictions.

The increase in interest rates will affect the stock market but also will affect businesses’ decisions about whether to invest in growth and new opportunities. If they don’t, then that means there isn’t the demand for workers, which balances out the supply and demand for labor. If you look at the number of retirees in the United States, not many people are sitting on a ton of investments to retire. The percentage of people that would retire and could live off of their investments, 401(k), pensions, etc., is not that large.

PILF 51 | Inflation
Inflation: Once people believe that inflation is going to be the norm, that starts getting baked into wage demands and price increases across the board. And it’s hard to undo that.


The other question is, at some point, do those retirees come back in the labor force and say, “Yeah, I can work for 10 to 15 hours at the grocery store to make enough money to cushion me.” That eases that pressure on the wages going up because you have lots of people out there willing to work for 10, 15, 20 hours a week doing the jobs.

This is where the challenge comes in. If you want to look at it from the Fed’s point of view of like, “What is the right interest rate increase to go for?” It’s not as simple as, “If we increase it, we know this is the decrease in inflation.” There are lots of other changes that individuals are going to be making and choosing. I don’t want to say it’s completely unknown, but there’s a lot of balancing that has to go on there.

If you tip the scales a little bit too much in one way, it skews off. If you try to rebalance by dumping a huge change the other way, now the scale is flipped back the other way. It’s hard to bounce it enough, so it smoothly goes back down to 2% inflation. That’s the risk. If the Fed essentially hinted that they’re going to have 3% interest rates, Goldman Sachs and others are like, “It’s going to be 4%,” and someone said, “It’s going to be at least 5%.”

If they keep going for that and that shuts the economy down too fast, then you’re in the position of, “Do we need a stimulus again? Do we drop interest rates?” That back and forth is hard to manage. It’s not just one thing. If the pandemic eases and supply chains flush out, that’s different from retirees deciding whether they want to retire or not. Managing all those different effects on what’s driving inflation right now is challenging.

If they say there will be 3% or 4% rate hikes, they said that in 2018 and then stopped because the consequences were too difficult for them. It’s clear that if they do these rate hikes, even though they’ve announced them and people know they’re coming, that will cause some asset prices problems. They talked about the everything bubble. I don’t know if that’s true or not, but it seems like everything’s inflated. If they raise rates and everything comes crashing down, are they going to have the courage of their convictions to say, “We got to just go through it?”

I don’t want to make this sound like it’s flipping, but that’s the genius of saying we’re going to have 3% rate hikes and the nice thing about it. The minute they said, “We’re going to have 3% rate hikes,” before Powell even said, “We think we’re going to have 3% rate hikes,” investors already expected what they thought he was going to say. If they thought he was going to say 2% and he said 3%, they’d be worried. If they thought he was going to say 6% and he said 3%, they’d be like, “What’s going on?” If they thought 3% and he said 3%, they’d be like, “That’s what we expected.”

If the first one comes into play and things get worse than expected, they don’t have to do the last two. The nice thing about forecasting is when you announce what you’re going to do, you get to see the reaction of the market before you do it, and then you can say, “It’s not the right time for the first one. We’re not saying we’re not doing three, but now instead of March, we’re going to wait until May or June.”

You don’t have to say you’re lying and making things up. The nice thing about announcing is that you get to see what the reaction is in the market to see the expectation of everyone in the economy. If everyone in the economy expects inflation to go back down to 2% in 2023 without the Fed stepping in, then the Fed should step in. If everyone expects it to be up at 6% or 7%, then the Fed needs to step in. What they’re doing is saying, “We want you to know we’re not going to let you set those expectations, so we will raise rates. If you respond quickly to that first-rate hike, then we’ll stop because we don’t need to keep going further.”

It’s interesting how expectations control a lot of this. The expectation of a rate hike and inflation caused an effect, so I imagine that’s difficult to figure out which is which. I wanted to switch here and talk about the supply chain issues. They started because of COVID. Are those going to get worked out if we get through COVID or if COVID keeps going? Maybe there are more strains that come out. How do we get through the supply chain issues?

The simple answer is if COVID continues to crop up and down here and there all over the world, it’s going to be challenging. The supply chain challenge isn’t just one simple answer. It could be that the beginning of the supply chain manufacturing plant had to shut down for two weeks. That means that there’s a ripple effect throughout the rest of the supply chain that they can’t get the parts when they need them.

Most of the supply chain is set up to adjust in time. If I can’t get the parts that I need from you, then I’m going to tell my other supplier, “Don’t give me your parts,” and then they’re going to shut down because they don’t need to supply. The production of where stuff is produced is hard to do. Managing that across the globe when you have hotspots pop up in different places is hard.

There are a lot more job openings not because people are sitting at home but because there aren’t enough workers to fill all those job openings.

Dump on top of that, how do we get the workers who can run the ships, trucks and ports? Those ports, trucks, and ships, you don’t want those assets sitting around. You want to be as productive as possible with little downtime. If you throw a week of COVID outbreak into there, it messes up the whole thing because not only do you have to do the 24-hour or whatever the time period is when you get back up to speed, but now you got to make up for the week you were down. You don’t have extra hours in the day to make up for it. Those two on top of each other are compounding issues.

A lot of companies are like, “We need to diversify the supply chain. We need to build excess capacity so that if that happens again, we can move around.” In the short run, that’s hard to do because it takes time to build capacity and build up that capability. In the long run, personally, I don’t see companies sticking to that because it’s a cost that’s going to drag on profits. A few years from now, after COVID, people are going to look at it and say, “We managed it. We can get rid of that.” The next pandemic or next crisis hits, it’s going to happen again.

Diversifying the supply chain and building excess capacity is going to take 18 to 24 months. It’s almost too late to do that, in my opinion. If we get to the point where it goes from pandemic to endemic, we know the percentage of employees that are going to be out at any one time, and it’s a steady-state, we can start to work through some of those issues. The up and down pops up of hotspots are going to be challenging. Every supply chain hates unexpected shocks.

Is the expectation game going to count in here as well? I remember before Amazon, if I ordered something online or through a catalog and called up, I knew would take a week or two to get here and I had no problem with that. Amazon shows up and then it’s two days, and then they went one day, even hours, but now it’s back to a couple of days or maybe a week, and I’ve changed my expectations. I’m like, “I know it’s not going to come immediately.” Does that help ease any of these supply chain issues? As you said, expectations might cause inflation and this other stuff.

In the short-term, then the same competitive pressures that caused Amazon to go from 2 days to 1 day to 3, 4 hours is going to happen again. It’s the Name That Tune challenge like, “I can do it in two and a half days. I can do it in two days.” That’s going to happen again. One other thing that is going to be interesting to see play out as the pandemic transitions to more of an endemic condition is that, for as much as inflation grew in the second half of 2021, holiday sales were enormous. It didn’t stop consumers from purchasing.

Part of what was driving that was that we weren’t purchasing services. We weren’t going to the movies. We weren’t going on trips. We weren’t doing the service types of stuff we normally would do. Instead, we bought products. You need some supply chain to provide the stuff that you do to provide services, but products are 2 days, 1 day, “I got to ship. It’s got to be produced. It’s just in time.”

If we shift back away from, “I got five couches. I don’t need a sixth couch. Now I want to go take that trip. I want to go do something more of a service or I want to go out to eat at the restaurant instead.” Is that going to put a lot less stress on the supply chain and help it work out? To the extent that we change our expectations and we want to go back to that more service experience, then that’s going to have different pressures in different parts of the supply chain. If we don’t, we reset our expectations of, “No. The way to get enjoyment is stuff,” then there’s going to continue to be some pressure because that’s not the way things had been going.

If it switches back to more service-based, people are buying more services rather than products, does that help with the inflation issue as well?

It could. It depends on whether you have the employees to provide those services. This is part of what the airlines were facing. People wanted to go fly on planes, but they didn’t have the flight attendants and the pilots to fly the planes because they were sick. Hotels are having a hard time getting people to come. If they come, they don’t have the staff to keep them clean or to manage the hotel. They can’t service the rooms.

Restaurants are hiring waitstaff and cooks. If you can find the workers to do those jobs and pay them, the question then becomes, are workers going to be so disillusioned with those jobs that they never want to go back? Are they going to say, “We’ll go back only if you pay us more?” If you pay more, then that could lead to inflation in those areas.

The other consideration we need to think about with inflation is 6% or 7% inflation systemic to the economy, which means prices are going up by 6% or 7% every year. People pointing to the stimulus packages as why inflation is going up were essentially one-time shocks to the system. Not every year, we’re going to have a stimulus of that size. Every year, if we have a stimulus that size, it would raise inflation consistently.

PILF 51 | Inflation
Inflation: If we hadn’t had the pandemic, we probably wouldn’t be seeing the inflation we’re seeing right now. That’s the bottom line.


If it’s a one-time shock, it’s going to re-stabilize at the new price level, and then go forward. Inflation will come back down to what it historically has been. The other thing we don’t know is, will the government continue to try to keep stimulating the economy? Will they back off? A one-time shock will lead to a level reset of prices. That’s what we don’t know. With the 6% or 7%, we’re seeing a reset of where the prices should be, but then they’ll stabilize at that level and grow at 1% or 2%. Will they continue to grow at 6% or 7% going forward in the future?

You talked about employers not having enough employees and not being able to find employees for certain jobs. What’s the reason for the employee shortages? I understand that they don’t want to do this low-paid work anymore or it’s dangerous because of the pandemic and all that, but where are they going to make money? They have to have some job or some income. I’m not understanding. We see those help wanted signs everywhere, but where are those people going for employment?

This is one of the oddities that are hard to understand about the labor market. Say, ten people lost their jobs because of a downturn. When the economy starts growing again, it’s not ten employers saying, “I want one worker.” It’s 100 employers all saying, “I want one worker.” Those ten people have 100 jobs to choose from. You look at and say, “Why are those 90 employers not filling their jobs?” It’s because they’re no workers out there. It’s not that there are 1,000 workers sitting around saying, “I don’t want to work ever again.” It’s that they have a choice of jobs to go to.

Whereas before in the steady-state, the number of people losing jobs and the number of people gaining jobs were steady. If I quit, I might not be able to find a job. Now I quit, $1,000 bonus, $500 bonus, we’ll pay for health insurance where we would never have paid it before. It is almost a seller’s market for workers selling their labor.

It’s not that people are necessarily staying home and not working. There are more because we see the labor participation rate going down. That’s both men and women. That’s partly people retiring early, and then childcare. We haven’t had childcare be able to come back to the point where people can go and work a full-time job and go back to that and commit to it because school might shut down or daycare is not available.

It’s not the case that people are sitting home saying, “I don’t want to work and I don’t need to work.” Some people are sitting home and saying, “I can’t get the childcare to go back to work.” Some people are saying, “I’m retiring because I don’t want to deal with this anymore.” For the people that do want to go back to work, there are so many options out there.

The way the economy works is if one restaurant wants to grow, that means twelve restaurants want to grow. They’re all fighting for the same small number of workers who want to go back to that industry. That’s happening with manufacturing. You name it across the board. There are a lot more job openings, not because people are sitting at home but because there aren’t enough workers to fill all those job openings.

You talked a little bit about the Boomers. How do other demographic changes? How does that factor into the employment situation and inflation?

Do you mean younger cohorts?

Yeah. I get that the Boomers are retiring. Gen Z is coming up and that’s supposed to be bigger than the Boomers. Is that going to have any short-term impact or is that going to be more long-term impact when they all become fully employed?

My understanding from looking at those is that Gen Z is not as big as the Boomer population. The problem with Social Security and Medicare going forward is we don’t have enough workers coming up to support the workers who are leaving. There are workers always entering the market. Before the crisis, it was a 63% labor force participation rate and now it’s 61.5%. That’s a lot of people. If that continues to go down further because people retired, there are not enough people coming to the labor force to replace all those people who are going to eventually retire.

For crypto to be that pervasive in terms of a means of exchange, it has to be the default for how people value stuff.

What are some other factors that might affect the economy in 2022 or short-term beyond that other than inflation and employment? Are there other things that you’re looking at, other issues that on the upside could be good for the economy, or things on the downside that could harm the economy, in your opinion?

The biggest upside is COVID getting to a slow and steady-state where it’s no longer a pandemic and doesn’t create shocks and surprises. That’s the biggest upside. The downside is because of COVID, we’ve been ignoring all the trade conflicts that had been the talk of the economy for 2 or 3 years before COVID hit. A lot of those tariffs are still in place. There’s a lot of distrust between countries.

Going forward, there’s the potential as countries get out of the pandemic and look back and say, “How come you didn’t help us during the pandemic?” We need to create a more resilient economy so we can survive the next pandemic. You could see a lot more nationalizing of economies, which could hurt trade. That’s a risk, which we’re not focusing on because of the pandemic. Going forward, that can be something that rears its head again and could cause challenges for the economy.

Do you think that Bitcoin or cryptocurrencies will have any effect on inflation or the economy? The Bitcoiners think that that’s going to be deflationary, but it would have to have wide adoption before it had any effect. Do you factor that in at all? Do you have any thoughts on crypto?

I see crypto as an investment asset and not much else. I am not a believer in crypto replacing currency, cash, dollars, euros or whatever as a means of exchange in a large way. Even now, when someone says, “We’ll take Bitcoin for this purchase,” it’s converted into how much Bitcoin will I take for this? How much is Bitcoin trading right now? How much is that equal in terms of dollars that I would price it at anyway?

We’re not thinking of Bitcoin as the currency because there are hundreds of these different cryptocurrencies out there trying to be the currency. The dollar is essentially the global currency. For any one crypto to be that pervasive in terms of a means of exchange, it has to be the default for how people value stuff.

The challenge I have with crypto as that pervasive is you think of the billions of transactions that happen every second with dollars all around the world. For a blockchain to be able to execute all those transactions seamlessly within the timeframe and to distribute to all the ledgers of all the billions of people who are on that blockchain instantaneously, you’re eventually going to have to get something where it’s not like, “We execute the transaction. We’ll update the blockchain later. Don’t worry about it.”

Once you get to that, then it’s not the magic of the blockchain anymore. It’s more like current ledgers where your transaction gets executed two days later. If that’s the case, then what’s the advantage of blockchain to me? Blockchain as an investment class, as an asset, sure you can invest in that like a stock or a bond or whatever. I’m skeptical that because of that instantaneous fluidity of currency and cash and all that we use as money, I struggle to see how that could be done technologically. If the technology improves so much, great, but right now, I don’t see the technology executing at nanoseconds to rewrite the blockchain every single time.

That’s an interesting take on it because I’ve heard a lot of opinions, but that hasn’t been one that I’ve heard a lot about. I know that they’re working on other layers on top of Bitcoin or crypto that will help that, but if the technology is not there, people are still waiting, and it doesn’t do what money needs to do, then it’s certainly not going to be adopted. It won’t have much of an effect other than investable assets. That makes sense to me.

I’d like to see if we can sum up some of what we’ve talked about. From a perspective of a real estate investor, our group is mostly passively investing in real estate syndications. Multifamily is a big one, but other assets as well like self-storage and mobile homes. How do you think inflation, the asset bubble and unemployment affect real estate investors? If you have any ideas, what should people think about as they continue to invest? It doesn’t make sense to just sit on your cash. We still want to invest. Without giving investment advice, maybe look into your crystal ball, what do you say to people that are still investing in real estate?

Not being a real estate investment expert, I would look at the interest rates from how I would look at it. The interest rates are going to drive a lot of the valuation of real estate. If the Fed does follow through with 3% or 4% interest rate increases, that is going to have a relatively serious impact on the housing market and the real estate market. It’s one of the more immediate places where the Fed’s changed in interest rate.

PILF 51 | Inflation
Inflation: We need to create a more resilient economy so we can survive the next pandemic. You could see a lot more nationalizing of economies, which could hurt trade, and that’s a risk that we’re not really focusing on because of the pandemic.


Businesses aren’t investing in new plants and new equipment every single day. Every day, people take out mortgage loans and buy and sell houses and properties. When the Fed raises interest rates, that gets baked into the price and the real estate asset valuation. For me, if I were thinking about owning or holding real estate, I’d want to pay attention to the interest rates and think about that.

If you think that inflation is going to be so systemically baked that the Fed’s going to have to raise interest rates 5%, 6% or 7%, that will have a big impact on real estate that you buy today. If you think that this is something that the Fed has to increase the rates by 1.5% in the next few years to hint to people, we’re not going to let this get out of hand, and then there may not be as much of an impact. To me, if I were trying to think about real estate investment, I’d want to pay attention to what the Fed is saying and what other people are saying about the expectation of interest rates. I would focus on the valuation of the assets that I’m holding.

This has been great. I appreciate you being on the show. The last question I always ask is, do you have a great podcast that you listen to that you like to recommend to our audience?

I’m ashamed to say I’m not a huge podcast listener. I’ve scattered around and listened here and there to things. Whatever catches my eye or my ear at that time is what I listen to. Unfortunately, I don’t have a system that I go to every single time. For me, it’s whatever catches your attention. To me, it’s all about learning and getting new information. Listening to a podcast just to say you listen to a podcast, if it’s not something of interest to you, you’re going to be focusing and reading something else and not listening to what the person is talking about. I hope no one is doing that. If it’s something you’re interested in and you will pay attention to listen, then that’s where you’ll learn something.

Thank you, John, for being on the show. This is fantastic, a ton of information. We appreciate it. Hopefully, we’ll get you on again once we know what the Fed is doing and we can talk about what they’ve done.

That’s great, Jim. Thank you so much for having me.

That was super interesting talking to John. Having an economist on the show is super helpful. It’s hard for anybody, including an economist, to predict what’s going to happen. If you take a look at what has happened or where we are now and you can try to analyze it, then a lot of what he was saying is the pandemic is causing a lot of these issues. There’s the supply chain issue, reduction in workforce, and inflation.

Hopefully, once we get through the pandemic and get it to where it’s just an endemic thing and it doesn’t affect us every day, many of these issues will come back to somewhat normal. He doesn’t necessarily think inflation is systemic. It’s part of what has happened over the last couple of years. Hopefully, we will work through it with possibly the help of the Fed.

The one thing that I wanted to ask him and was interested in is how consumer expectations can cause something to happen. It didn’t make sense to me and he explained that if everybody is expecting inflation to happen, then they’re going to be doing things that cause inflation to happen more than it otherwise would. It’s interesting that expectations have such an effect on the economy. That was super interesting.

I liked the advice that he gave for real estate investors like us. It’s not anything earth-shattering. Pay attention to interest rates because the more interest rate hikes the Fed does, the more that will affect the real estate market. Likely, if they just do a few and a couple of percentage points, it’s not going to change things significantly because it’s not a huge change from where we are. It puts us back to normal or even under normal from where we’ve always been. That seems to make sense to me.

If the Fed keeps raising rates 5% to 6% over time, then that certainly will have some effects and we’re going to have to reevaluate at that time. I’m pleased to have John on the show. We will get him back after seeing what the Fed is doing, seeing how the economy changes, and seeing how we’re getting through this pandemic. He’ll have some great input for us again in the future. That’s it for us. We’ll see you next time on the Left Field.

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About John Horn

PILF 51 | InflationI have always had a great passion for games — creating games, playing games, solving puzzles (crossword and jigsaw). When I took my first game theory course as an undergrad, I loved how it could help me think through all the moves and counter-moves that go into analyzing a game. I have used that interest to helping companies think about their strategic challenges by using the principles of game theory to help them simulate how the market might play out.

Along the way, I realized that as I designed the games, a common refrain was “We can’t include that competitor or understand them because they are irrational.” In every case, I was able to get the client to explain to me why the others were being rational. And so I’ve incorporated this behavioral element into the games and understanding of others’ mindsets.

The final piece of the puzzle has been utilizing my experience as an actor and director in the theatre to make the simulations “come alive” and be as much about the story-telling and the realism of what’s happening as it is about the analytics. Living the choices of others, through the scenes and situations created, helped to better embed that knowledge in the participants.


Our sponsor, Tribevest provides the easiest way to form, fund, and manage your Investor Tribe with people you know, like, and trust. Tribevest is the Investor Tribe management platform of choice for Jim Pfeifer and the Left Field Investors’ Community.

Tribevest is a strategic partner and sponsor of Passive Investing from Left Field.

Chris Franckhauser

Vice President of Strategy & Growth, Advisory Partner

Chris Franckhauser, Vice President of Strategy & Growth, Advisory Partner for Left Field Investors, has been involved in real estate since 2008. He started with one single-family fix and flip, and he was hooked. He then scaled, completing five more over a brief period. While he enjoyed the journey and the financial tailwinds that came with each completed project, being an active investor with a W2 at the time, became too much to manage with a young and growing family. Seeing this was not easily scalable or sustainable long term, he searched for alternative ideas on where to invest. He explored other passive income streams but kept coming back to his two passions; real estate and time with his family. He discovered syndications after reconnecting with a former colleague and LFI Founder. He joined Left Field Investors in 2023 and has quickly immersed himself into the community and as a key member of our team.  

Chris earned a B.S. from The Ohio State University. After years in healthcare technology and medical devices, from startups to Fortune 15 companies, Chris shifted his efforts to consulting and owning a small apparel business when he is not working with LFI (Left Field Investors) or on his personal passive investments. A few years ago, Chris and his family left the cold life in Ohio for lake life in the Carolinas. Chris lives in Tega Cay, South Carolina with his wife and two kids. In his free time, he enjoys exploring all the things the Carolinas offer, from the beaches to the mountains and everywhere in between, volunteering at the school, coaching his kids’ sports teams and cheering on the Buckeyes from afar.  

Chris knows investing is a team sport. Being a strategic thinker and analytical by nature, the ability to collaborate with like-minded individuals in the Left Field Community and other communities is invaluable.  

Jim Pfeifer

President, Chief Executive Officer, Founder

Jim Pfeifer is one of the founders of Left Field Investors and the host of the Passive Investing from Left Field podcast. Left Field Investors is a group dedicated to educating and assisting like-minded investors negotiate the nuances of the passive investing landscape and world of syndications. Jim is a former financial advisor who became frustrated with the one-path-fits-all approach of the standard financial services industry. Jim now concentrates on investing in real assets that produce cash flow and is committed to sharing his knowledge with others who are interested in learning a different way to grow wealth.

Jim not only advises and helps people get started in passive real estate syndications, he also invests alongside them in small groups to allow for diversification among multiple investments and syndication sponsors. Jim believes the most important factor in a successful syndication is finding a sponsor that he knows, likes and trusts.

He has invested in over 100 passive syndications including apartments, mobile homes, self-storage, private lending and notes, ATM’s, commercial and industrial triple net leases, assisted living facilities and international coffee farms and cacao producers. Jim is constantly looking for new investment ideas that match his philosophy of real assets producing cash flow as well as looking for new sponsors with whom he can build quality, long-term relationships. Jim earned a degree in Finance & Marketing from the University of Oregon and a Master’s in Business Education from The Ohio State University. He has worked as a reinsurance underwriter, high school finance teacher, financial advisor and now works exclusively as a full-time passive investor. Jim lives in Dublin, Ohio with his wife, three kids and two dogs. In his free time, he loves to ski, play Ultimate frisbee and cheer on the Buckeyes.

Jim earned a degree in Finance & Marketing from the University of Oregon and a Master’s in Business Education from The Ohio State University. He has worked as a reinsurance underwriter, high school finance teacher, financial advisor and now works exclusively as a full-time passive investor. Jim lives in Dublin, Ohio with his wife, three kids and two dogs. In his free time, he loves to ski, play Ultimate frisbee and cheer on the Buckeyes.

Chad Ackerman

Chief Operating Officer, Founder

Chad is the Founder & Chief Operating Officer of Left Field Investors and the host of the LFI Spotlight podcast. Chad was in banking most of his career with a focus on data analytics, but in March of 2023 he left his W2 to become LFI’s second full time employee.

Chad always had a passion for real estate, so his analytics skills translated well into the deal analyzer side of the business. Through his training, education and networking Chad was able to align his passive investing to compliment his involvement with LFI while allowing him to grow his wealth and take steps towards financial freedom. He has appreciated the help he’s received from others along his journey which is why he is excited to host the LFI Spotlight podcast and share the experience of other investors and industry experts to assist those that are looking for education for their own journey.

Chad has a Bachelor’s Degree in Business with a Minor in Real Estate from the University of Cincinnati. He is working to educate his two teenagers in the passive investing world. In his spare time he likes to golf, kayak, and check out the local brewery scene.

Ryan Steig

Chief Financial Officer, Founder

Ryan Stieg started down the path of passive investing like many of us did, after he picked up a little purple book called Rich Dad, Poor Dad. The problem was that he did that in college and didn’t take action to start investing passively until many years later when that itch to invest passively crept back up.

Ryan became an accidental landlord after moving from Phoenix back to Montana in 2007, a rental he kept until 2016 when he started investing more intentionally. Since 2016, Ryan has focused (or should we say lack thereof) on all different kinds of investing, always returning to real estate and business as his mainstay. Ryan has a small portfolio of one-to-three-unit rentals across four different markets in the US. He has also invested in over fifty real estate syndication investments individually or with an investment group or tribe. Working to diversify in multiple asset classes, Ryan invests in multi-family, note funds, NNN industrial, retail, office, self-storage, online businesses, start-ups, and several other asset classes that further cement his self-diagnosis of “shiny object syndrome”.

However, with all of those reaches over the years, Ryan still believes in the long-term success and tenets of passive, cash-flow-focused investing with proven syndicators and shared knowledge in investing.

When he’s not working with LFI or on his personal passive investments, he recently opened a new Club Pilates franchise studio after an insurance career. Outside of that, he can be found with his wife watching whatever sport one of their two boys is involved in during that particular season.

Steve Suh

Chief Content Officer, Founder

Steve Suh, one of the founders of Left Field Investors and its Chief Content Officer, has been involved with real estate and alternative assets since 2005. Like many, he saw his net worth plummet during the two major stock market crashes in the early 2000s. Since then, he vowed to find other ways to invest his money. Reading Rich Dad, Poor Dad gave Steve the impetus to learn about real estate investing. He first became a landlord after purchasing his office condo. He then invested passively as a limited partner in oil and gas drilling syndications but quickly learned the importance of scrutinizing sponsors when he stopped getting returns after only a few months. Steve came back to real estate by buying a few small residential rentals. Seeing that this was not easily scalable, he searched for alternative ideas. After listening to hundreds of podcasts and attending numerous real estate investing meetings, he determined that passively investing in real estate syndications was the best avenue to get great, risk-adjusted returns. He has invested in dozens of syndications involving apartment buildings, self-storage facilities, resort properties, ATMs, Bitcoin mining funds, car washes, a coffee farm, and even a Broadway show.

When Steve is not vetting commercial real estate syndications in the evenings, he is stomping out eye diseases and improving vision during the day as an ophthalmologist. He enjoys playing in his tennis and pickleball leagues and rooting for his Buckeyes and Steelers football teams. In the past several years, he took up running and has completed three full marathons, including the New York City Marathon. He is always on a quest to find great pizza, BBQ brisket, and bourbon. He enjoys traveling with his wife and their three adult kids. They usually go on a medical mission trip once a year to southern Mexico to provide eye surgeries and glasses to the residents. Steve has enjoyed being a part of Left Field Investors to help others learn about the merits of passive, real asset investments.

Sean Donnelly

Chief Culture Officer, Founder

Sean holds a W2 job in the finance sector and began his real estate investing journey shortly after earning his MBA. Unfortunately, it could not have begun at a worse time … anyone remember 2007 … but even the recession provided worthy lessons. Sean stayed in the game continuing to find his place, progressing from flipping to owning single and multi-family rentals to now funding opportunities through syndications. While Sean is still heavily invested in the equities market and holds a small portfolio of rentals, he strongly believes passive investing is the best way to offset the cyclical nature of traditional investment vehicles as well as avoid the headaches of direct property ownership. Through consistent cash flow, long term yield and available tax benefits, the diversification offered with passive investing brings a welcomed balance to an otherwise turbulent investing scheme. What Sean likes most about the syndication space is that the investment opportunities are not “one size fits all” and the community of investors genuinely want to help.

He earned a B.S. in Finance from Iowa State University in 1995 and a MBA from Otterbein University in 2007. Sean has lived in eight states but has called Ohio home for the last 20+.  When not attending his children’s various school/sporting events, Sean can be found running, golfing, shooting or fly-fishing.

Patrick Wills

Chief Information Officer, Advisory Partner

An active real estate investor since 2017, Patrick Wills’ investing journey began like many others – after reading the “purple book” by Robert Kiyosaki. Patrick started with single family rentals, and while they performed well, he quickly realized their inability to scale efficiently while remaining passive. He discovered syndications via podcasts and local meetups and never looked back. He joined Left Field Investors in 2022 as a member and has quickly become an integral part of the team as Vice President of Technology.

An I.T. Systems Engineer by trade, he experienced the limitations of traditional Wall Street investing firsthand in his career and knew there had to be a better way to truly have financial freedom.

Unfortunately, that better way is inaccessible to those who need it most. His mission is to make alternative investments accessible to everyone who seeks to take control of their financial future and to pursue their passions in life.

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