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U.S. inflation reached a new four-decade high of 8.6% in May

wsj.com

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Re: U.S. inflation reached a new four-decade high of 8.6% in May

#41

Post by junofan »

JohnDeHope wrote: post #38
voisin wrote: post #22

Earlier quoted context omitted.

Everyone likes to blame the Russia-Ukraine conflict but inflation was spiking prior to supply issues. That war is a convenient scapegoat for politicians and bureaucrats who don’t want to take credit for profligate spending and loose policy for decades.

This is a nitpick, but profligate spending cannot create inflation. If I have a million dollars, and I spend a million dollars, that doesn't create inflation. Even if I spent the million dollars on stupid NFT cat gifs. I got the money from somewhere and I spent it, and sent it back out. No net inflation. The inflation comes from the printing and spending of new money.

No. You’ve increased demand. Inflation refers to price level, not money supply.

Re: U.S. inflation reached a new four-decade high of 8.6% in May

#42

Post by AnimalMuppet »

TurkishPoptart wrote: post #34

This administration is a failure.

Perhaps it is. This doesn't show it, though.

We have inflation from (at least) one of two causes. First, all the money created to keep the economy from falling apart during the Covid semi-shutdown. Well, who did that? Biden? Yes, and also Trump. I literally got checks in the mail with Trump's signature on them. So blaming this on Biden seems rather unfair.

The other reason for inflation is the economic blockade of Russia, specifically Russian oil. That's 100% on Biden, but it's also the right thing to do. That's not failure, that's leadership. There's not all that much I agree with Biden on, but I agree with his handling of the Russia/Ukraine situation.

Re: U.S. inflation reached a new four-decade high of 8.6% in May

#43

Post by zaccusl »

TurkishPoptart wrote: post #35

All-time high for U.S. inflation All-time high for gas prices ($6/gal in Seattle!) All-time high for food prices Needless to say, elections in November are going to be VERY interesting.

Why? If Republicans control congress what will be different? Is the US going to be the only country in the world to get inflation under control? Is the GOP that good? What are their solutions (serious question)? Because all I here is "CRT bad" and "don't say gay". I never hear anything proposed to solve any of this.

Re: U.S. inflation reached a new four-decade high of 8.6% in May

#44

Post by TingPing »

zaccusl wrote: post #43
TurkishPoptart wrote: post #35

All-time high for U.S. inflation All-time high for gas prices ($6/gal in Seattle!) All-time high for food prices Needless to say, elections in November are going to be VERY interesting.

Why? If Republicans control congress what will be different? Is the US going to be the only country in the world to get inflation under control? Is the GOP that good? What are their solutions (serious question)? Because all I here is "CRT bad" and "don't say gay". I never hear anything proposed to solve any of this.

None of that matters. "current situation bad = vote different color" for some.

Re: U.S. inflation reached a new four-decade high of 8.6% in May

#45

Post by s1artibartfast »

mc32 wrote: post #26
voisin wrote: post #22

Earlier quoted context omitted.

Everyone likes to blame the Russia-Ukraine conflict but inflation was spiking prior to supply issues. That war is a convenient scapegoat for politicians and bureaucrats who don’t want to take credit for profligate spending and loose policy for decades.

Russia is a convenient excuse. It's not the reason. They cancel the XL and other pipelines but pressure KSA to produce more. The whitehouse has even admitted they are using this situation to push their stated agenda of transitioning to more renewables (noble, but not consequence free). They want to eat their cake and have it too. Reality does not work that way.

Energy prices have been going up much faster than inflation long before anything with Russia. Part is increase in cost of fossil fuels more expensive Renewables, and removing cheap coal. I'll add you to our projected savings from Renewables have not kicked in.

This isn't a good or bad judgement just the facts on the ground

Re: U.S. inflation reached a new four-decade high of 8.6% in May

#46

Post by everybodyknows »

s1artibartfast wrote: post #13
ren_engineer wrote: post #9

Earlier quoted context omitted.

it will last much longer and will get worse, because everything is dependent on energy to be created/transported. There's also the fact that many retailers admitted to eating losses to try and keep customers happy assuming that inflation would be "transitory", pretty soon many of these retailers will be forced to raise prices to reflect reality

If Energy prices are driving it we are in for a long haul. Electricity costs in California is up 50% in the last five years. Efforts to on Shore manufacturing will drive it up higher https://www.paloaltoonline.com/blogs/p/2022/03/06/when-will-...

> UC Berkeley economist Meredith Fowlie recommends that the fixed-charge be larger for higher-income households, as shown below. This idea was popular among the speakers ...

So perhaps we'll soon be sending a copy of our tax returns along with our power bill for the month of May. Such a policy might anyway help wealthier people empathize with the humiliation of the poor, who are already being coerced to explain their financial circumstances to the power company:

> lower-income households (CARE and FERA customers)

Re: U.S. inflation reached a new four-decade high of 8.6% in May

#47

Post by 100xdang »

mariojv wrote: post #3

Anyone have opinions on how long this inflation spike will last, or what the peak will be? I seriously thought we had maybe peaked earlier this year, and it looks like the peak so far was in March for core inflation excluding food and energy. However, maybe high energy prices will feed back into other consumer prices eventually, triggering more inflation. The producer price index (PPI) is still really wild, so maybe…

This is the new baseline, you won't see inflation lower than this long-term until the system completely collapses under its own weight. The only thing keeping things running is cheap money and there will need to be more of it. Any "solution" that looks like austerity will result in destabilizing unrest. In the USA, Republicans will campaign on inflation but make money as cheap as ever as soon as they have control, because it's the only way to keep things afloat.

I think this situation is trash, but deflation is much, much worse than inflation. We don't need to revisit 1929, upper middle class will just have to live with dilution of assets if they want a functioning society.

Re: U.S. inflation reached a new four-decade high of 8.6% in May

#48

Post by commandlinefan »

zaccusl wrote: post #43
TurkishPoptart wrote: post #35

All-time high for U.S. inflation All-time high for gas prices ($6/gal in Seattle!) All-time high for food prices Needless to say, elections in November are going to be VERY interesting.

Why? If Republicans control congress what will be different? Is the US going to be the only country in the world to get inflation under control? Is the GOP that good? What are their solutions (serious question)? Because all I here is "CRT bad" and "don't say gay". I never hear anything proposed to solve any of this.

> If Republicans control congress what will be different?

Um, well, a lot will be different, but nothing with regards to gas prices or inflation. And this is coming from somebody with a passionate bordering on maniacal hate for democrats.

Re: U.S. inflation reached a new four-decade high of 8.6% in May

#49

Post by sfe22 »

100xdang wrote: post #47
mariojv wrote: post #3

Anyone have opinions on how long this inflation spike will last, or what the peak will be? I seriously thought we had maybe peaked earlier this year, and it looks like the peak so far was in March for core inflation excluding food and energy. However, maybe high energy prices will feed back into other consumer prices eventually, triggering more inflation. The producer price index (PPI) is still really wild, so maybe…

This is the new baseline, you won't see inflation lower than this long-term until the system completely collapses under its own weight. The only thing keeping things running is cheap money and there will need to be more of it. Any "solution" that looks like austerity will result in destabilizing unrest. In the USA, Republicans will campaign on inflation but make money as cheap as ever as soon as they have control, be…

Deflation being much much worse is a nice joke. You telling me that if gas and food and rent lowered in price over time, I will be worse off? Stuff are supposed to become cheaper as technology advances yet we only either get high or low price increases, all to fund the rich in the government.

Re: U.S. inflation reached a new four-decade high of 8.6% in May

#50

Post by seibelj »

puranjay wrote: post #25
voisin wrote: post #8

Earlier quoted context omitted.

> They can't raise interest rates quickly because it would nuke the easy-money economy (i.e. the entire economy) that has become addicted to low rates. This is exactly why the easy-money economy should never have been allowed to occur and persist for so long.

Mind boggling to me that you could get a 500k mortgage at 3% interest rate in the US.

It’s also fixed rate! As inflation eats into purchasing power, your monthly bill never goes up.
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