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US inflation jumps to 31-year high amid global supply chain crisis

theguardian.com

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Re: US inflation jumps to 31-year high amid global supply chain crisis

#131

Post by rsj_hn »

ChrisLomont wrote: post #93
argentinian wrote: post #8

Some journalists must be happy with this news. https://mises.org/power-market/inflation-celebration

There's a reason exactly zero of top econ journals or economists[2] are Mises.org Austrian economists - they don't have a track record of anything resembling accuracy, predictions, or theory that works. In fact, it's hard to find much even on Google Scholar.... [1] https://ideas.repec.org/top/top.journals.all.html [2] https://ideas.repec.org/top/top.person.all.html

Meh, Hayek was awarded the Nobel. The Austrian school does have a lot of useful insights. Perhaps those insights are not so amenable to the kind of economics that is a fruitful research field and can get grants, but that doesn't mean it's not fruitful for understanding the economy. The main reason why the Austrians tend to be snubbed is that their insights are primarily qualitative rather than quantitative, and thus are not the kinds of things that followers can build on to get published. That does not mean that people who do get published aren't taking inspiration from Austrian economics or learning important lessons from this field.

This is the problem with a lot of heterodox econ, btw.

Re: US inflation jumps to 31-year high amid global supply chain crisis

#132

Post by option_greek »

mywittyname wrote: post #111
kerng wrote: post #40

Earlier quoted context omitted.

You miss the key point on why this is happening and will continue to get significantly worse. What happens when the number of dollars approximately doubles in 2 years as it happened? Do you think prices stay the same and everything is just 50% off? Reality is that the current number is off by reality quite a bit, real number has to be much higher. It's just math and the worst part... it can't be just reversed.

> What happens when the number of dollars approximately doubles in 2 years as it happened? Do you think countries that don't use the USD will remain unaffected? People keep blaming this on the fed "printing money", but that logic only holds water when just the USA is affected. Everyone is experiencing inflation; it's a global phenomenon. Some countries have it even worse than the USA because their local production is…

The money fed prints doesn't stay in USA. It floods the entire globe trying to find the maximum return it can. That is the reason all stock markets everywhere are at record highs and commodities are continuing to push upward. As more economies are getting heated, many have started raising their own interest rates to reduce inflation.

Re: US inflation jumps to 31-year high amid global supply chain crisis

#133

Post by [deleted] »

ChrisLomont wrote: post #93
argentinian wrote: post #8

Some journalists must be happy with this news. https://mises.org/power-market/inflation-celebration

There's a reason exactly zero of top econ journals or economists[2] are Mises.org Austrian economists - they don't have a track record of anything resembling accuracy, predictions, or theory that works. In fact, it's hard to find much even on Google Scholar.... [1] https://ideas.repec.org/top/top.journals.all.html [2] https://ideas.repec.org/top/top.person.all.html

[deleted]

Re: US inflation jumps to 31-year high amid global supply chain crisis

#134

Post by coding123 »

m0llusk wrote: post #70
MeinBlutIstBlau wrote: post #47

Earlier quoted context omitted.

Cereal I could buy for $3 and granola bars I could buy for $2 now cost $4.30 and $3.29 respectively. Detergent that was $5 is now $7.50. McDonald's cheeseburgers are $2 on their own. That is the largest jump of inflation I've ever experienced in such a short time.

That is not a lot of information, though. Processed food has been harder hit than real food and areas that are entirely dependent on trucking because of a lack of ports or rail also have seen much greater impacts.

I could go to the grocery store later today and catalog about 400 items for you that have jumped 2 or 3 dollars like that. I am telling you it's insane right now.

Re: US inflation jumps to 31-year high amid global supply chain crisis

#135

Post by zzleeper »

boringg wrote: post #27

Hey everyone - we need to chill out for a second. Stop buying the knee jerk reaction of the media trying to freak everyone out and get some good advertising dollars. This is going to take until after the new year maybe Q1-Q3 timeframe to see if it is transitory. Reminder: we had an unprecedented global supply collapse followed by shutdowns and border closures for more than a year combined with historic levels of fast…

Even if it's transitory, what's the reason to keep injecting cash _today_ via buying agency mbs and other securities?

Re: US inflation jumps to 31-year high amid global supply chain crisis

#136

Post by tbabb »

nightski wrote: post #57
simonsarris wrote: post #13

I've mentioned before [1] but these prices still don't seem that serious. Most prices have still not beat their highs made in 2008-2014 (crude oil, global energy price, eggs, milk, sugar, rice, chicken, pork chops). Ground beef is an outlier, however. And US price per kwh is back at its peak, though it declined in these October numbers to be below... 2014 numbers again. [2] So while the climb up is bad, the prices th…

It's not the prices people are necessarily scared with, it's the rate of increase. It's higher than was anticipated. What's also concerning is that the velocity of money is really low while M2 money supply is very high. If the velocity picks up we could be in a world of hurt.

Maybe a stupid question, but if the velocity goes up, couldn't/wouldn't the Fed contract the supply?

It seems like having large supply is desirable/correct when velocity is low.

Re: US inflation jumps to 31-year high amid global supply chain crisis

#137

Post by bluedino »

coding123 wrote: post #107
simonsarris wrote: post #13

I've mentioned before [1] but these prices still don't seem that serious. Most prices have still not beat their highs made in 2008-2014 (crude oil, global energy price, eggs, milk, sugar, rice, chicken, pork chops). Ground beef is an outlier, however. And US price per kwh is back at its peak, though it declined in these October numbers to be below... 2014 numbers again. [2] So while the climb up is bad, the prices th…

Not a single item I buy in the grocery store right now is less than 50% more expensive than it was 6 months ago.

I used to spend an average of $50 a trip and now it is $70

Re: US inflation jumps to 31-year high amid global supply chain crisis

#138

Post by lazide »

wbsss4412 wrote: post #119
lazide wrote: post #105

Earlier quoted context omitted.

We’ve got one large ‘once in a century’ shock going on now. Bretton woods was less than a century ago. I don’t know how we would even quantify in any real what odds on any of these events practically speaking. Do you?

This isn’t even the biggest inflation shock in the last 50 years. A lot of the inflation we are seeing is due to base effects from last year. Oil prices literally went negative at one point and are only back to pre fracking boom levels.

The last shock in the 70’s caused large scale socio economic changes and power shifts, and the ‘currency’ was brand ‘new’ at the time (less than 20 years since Bretton Woods, still riding high on post WW2 prosperity, etc)

The demand collapse and now demand spike we’re seeing only started occurring very recently (less than 6 months ago for the spike), and we don’t know what will happen. We’ve never had anything like it occur in a modern economy at this scale.

So probably not going to end the world or anything, but we really don’t have any precedent for this situation.

Re: US inflation jumps to 31-year high amid global supply chain crisis

#139

Post by dlp211 »

BitwiseFool wrote: post #77
nbardy wrote: post #66

Earlier quoted context omitted.

It's never "transitory", thats a bullshit world the Fed is using to keep people call. The prices are never going to go back to normal even if the rise of inflation ends we don't go back to normal prices unless things deflate.

"Transitory" is a deceptively clever phrase. It implies the situation will go back to normal, or even reverse. Truthfully, it just means the increased rate of change in inflation is expected to decrease. Reminds me of a second derivative.

Inflation is a rate. If the rate is transitory, who is being deceptive?

Re: US inflation jumps to 31-year high amid global supply chain crisis

#140

Post by r00fus »

zzleeper wrote: post #130
dtwest wrote: post #80

Earlier quoted context omitted.

They were going up a couple of years ago. https://fred.stlouisfed.org/series/FEDFUNDS

What happened in 2019?

Politics. Rates had to go down for the re-election effort.
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