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36 PCB007 MAGAZINE I JULY 2021 Feature Article by Shawn DuBravac IPC Long-time fans of DC Comics' Superman will inevitably remember the o-spoken words uttered by Clark Kent moments before flying off: "Up, up, and away!" As a kid, I was actu- ally a bigger fan of the short-lived U.S. sitcom, "e Greatest American Hero," which aired in the early 1980s. In the show, substitute teacher Ralph Hinkley is given a suit with superhuman abilities by a group of aliens. But Ralph doesn't know how to use the suit properly, and while he can fly the suit, he can't land it which re- sults in a never-ending series of crash landings. (Hard to believe this show was cancelled aer just two seasons, right?) These juxtaposed superheroes sum up my current view on inflation. Prices are "up, up, and away." And the big question we face now centers on the kind of landing we should expect. More accurately I should say, prices are up, up, and… up! Copper, for example, is at an all-time high—up 94% over the last year and up 69% compared to two years ago. But copper isn't alone. We are seeing higher prices across the board. e IMF's Non-Fuel Price Index, which includes precious metal, food, and in- dustrial inputs, is up 43.6% over the last year and 44.7% over the last two years. Include fuel prices, and prices are up 70% over the last year. And that's if you can even get the product you want in the first place, as shortages and longer lead-times abound. Prices are up for three core reasons: • Base-year effects • Misaligned supply chains • Pent-up demand Let's take a quick look at each of these. Base Year Effects In the early months of the pandemic, the lev- el of average prices fell. Fast forward a year and higher prices feel even higher when com- paring them to the low base of April 2020. In other words, year-over-year growth rates can Economic Drivers Take Us 'Up, Up, and Away!'