All I know is the stock market is really antsy and wants to be done with this whole “inflation/recession crap”. They want to leave that behind and go back to the old times of worry free trading. Any moderate or neutral news is taken to positive and there is going to push it up
U.S. annual inflation rate drops to 8.5%
411–420 of 918 posts
Re: U.S. annual inflation rate drops to 8.5%
#412How easy this value can be verified? In other words, do we have all inputs public and the algorithm (with all its "hedonistic adjustments") is fully accessible? Can we track changes in the algorithm? Even with the effect of high base, I am getting increasingly suspicious of official numbers (same with the unemployment statistics). Energy costs have skyrocketed and they get into almost everything an economy produces.…
The data, and the algorithm, are public. You just have to look. You say energy prices have skyrocketed? well yeah, and that is reflected. year over year, increased over 30%, according to this: https://www.bls.gov/cpi/ The truth there are different inflation measures that tell us different things about the economy. Also, when the structure of the economy changes, the indexes used might mismatch what people are actuall…
>You just have to look.
Have you done it? Can you confidently say that you can completely reproduce it?
What I would like to see ideally is something like a spreadsheet with all formulas, coefficients, and inputs being inside it for every published CPI value. And every calculation input in the spreadsheets has to include its source.
As the famous saying goes, there are 3 kinds of kinds of lies: lies, damned lies, and statistics. There is a LOT of wiggle room to play with inputs, coefficients, wights, and various adjustments.
Re: U.S. annual inflation rate drops to 8.5%
#413Earlier quoted context omitted.
The issue has to do with the harvest coming up. The next harvest will come from fields with less fertilizer and higher fuel prices. We can expect corn prices in the fall jumping significantly. Next year will even be worse, we are using a fuel reserves now and fertilizer will still be an issue (unless peace is made with Russia). I’m expecting a significant increase in the next 2-3 months then again in 15-16 months.
Quoted post unavailable.
Yes, fertilizer prices have been increasing since the lockdowns.
Unfortunately, the sanctions on Russia and Belarus increased it a further ~50%
https://ycharts.com/indicators/fertilizers_index_world_bank
I expect that to continue as our stores are reduced.
Re: U.S. annual inflation rate drops to 8.5%
#414Earlier quoted context omitted.
Sure but companies are also still reporting record profits in many cases right now so it's clearly not just input costs driving up prices.
>companies are also still reporting record profits Adjusted for inflation?
Their profits account for inflation already in some ways because the increased costs are already accounted for when we're talking about profits by definition.
Re: U.S. annual inflation rate drops to 8.5%
#415Good news I guess. But my electricity price literally doubled. My house insurance is up 30%. My gas bill is up by a lot. Have you seen the price of oreos? The $5 box at Taco Bell is my splurge and I'm trying to cut back on everything I can.
A Sausage McMuffin and a coke used to cost $2.12 at most locations near me two years ago. Today it varies from $2.95 up to $3.85 (strangely this high value is in Detroit proper where income is lowest vs the burbs). I notice this price varies even at the same locations sometimes, but it's WAY up in general by a solid 50 percent in 2 years.
Everything I care about definitely seems to have gone up a lot more than the nominal inflation rate would suggest. Maybe not 50%, but... certainly more than 20% over the last two years.
Then again that's been true since I started paying attention to this stuff almost 20 years ago. The reported inflation rate's never felt all that close to how much stuff I buy's actually going up in price (the reported rate's consistently a lot lower than that).
HOWEVER, in the specific case of McDonalds, you have to factor in that they've spent the last few years aggressively optimizing for price discrimination. If you're poor, you use the app and physical coupons and never pay menu prices, but something closer to what the prices used to be. If you're not poor you pay menu prices and wonder when fast food stopped being cheap (it didn't, they just make you trade some time and effort to get "normal" prices now)
Re: U.S. annual inflation rate drops to 8.5%
#416Great. All I know is I'm trading a lot more time for money this year. Way less takeout, avoiding toll roads unless it saves at least 30 minutes, fewer streaming services (will renew on a show-by-show basis), and food is getting so crazy I might start going to multiple stores to try and save money instead of my one consolidated trip to Wegmans. I'm also stuffing my freezer with meat and have a year's supply of non-per…
I'm riding my bike a lot more to get places, rather than just for recreation; and it seems this is true for many around me as well.
But when you think about it, what’s the benefit of driving? For reasonably short drives you don’t save much time with parking in cities and you don’t get any exercise.
Re: U.S. annual inflation rate drops to 8.5%
#417Earlier quoted context omitted.
Sure but companies are also still reporting record profits in many cases right now so it's clearly not just input costs driving up prices.
Yes, but you have adjust those earnings for inflation... It's even more complex because inflation is variable across industries.
Their increased costs are already factored in because we're talking about profits though so I'm not sure how much use deducting that again would be for determining that.
Re: U.S. annual inflation rate drops to 8.5%
#418So the year over year CPI increase each month this year (starting from January) was 7.5%, 7.9%, 8.5%, 8.3%, 8.6%, 9.1%, 8.5%. So this value has been jumping around a bit as it has been going up. This drop is being taken as good news -- but I worry whether this is really a meaningful drop or whether we are just over interpreting what could be a fundamentally noisy metric?
I don't think anyone serious is taking this as anything more than mildly encouraging.
The monthly figure dropping to 0% inflation (0.3% core) is about as encouraging as you could
possibly have on the inflation front.
The main moderating factor on that is that one month doesn't necessarily mean a sustained trend.
Re: U.S. annual inflation rate drops to 8.5%
#419How easy this value can be verified? In other words, do we have all inputs public and the algorithm (with all its "hedonistic adjustments") is fully accessible? Can we track changes in the algorithm? Even with the effect of high base, I am getting increasingly suspicious of official numbers (same with the unemployment statistics). Energy costs have skyrocketed and they get into almost everything an economy produces.…
the govt changed the way CPI metric was calculated in January 2022 to mask some of the inflation https://twitter.com/truflation/status/1557349186466627586 https://youtube.com/watch?v=cb7oI8Hs16g http://www.shadowstats.com/alternate_data/inflation-charts
In January, they moved [1] to using 2019-2020 price data, as they have done every two years for decades. [2] This is how the CPI works, and all of the methodology is public.
[1]https://www.bls.gov/cpi/notices/2021/2022-weight-update.htm
[2]https://www.bls.gov/cpi/tables/relative-importance/home.htm
Re: U.S. annual inflation rate drops to 8.5%
#420Earlier quoted context omitted.
propagandist gonna propagandize, i guess.
here’s a biased media outlet that may meet your standards https://www.nytimes.com/2022/05/24/technology/inflation-meas...
From the New York Times article you linked to:
"But experts on inflation say the changes to calculations over the years have made the reported rate a more accurate snapshot of how much prices are rising for shoppers. The rate under a different methodology might be higher, they say, but the effect would be small, and the alternative number would do a poorer job of reflecting the costs consumers were grappling with."