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US annual inflation declines to 7.7% in October vs. 7.9% expected

bls.gov

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Re: US annual inflation declines to 7.7% in October vs. 7.9% expected

#131

Post by onion2k »

thomastjeffery wrote: post #83
lunaru wrote: post #31

It bears repeating because this is a common mistake in inflation discussions: a decrease in inflation metrics means price increases are slowing down, it doesn’t mean that prices are going down （that would require a negative CPI print). Also, this number is year over year, so the decrease just means the price increases between Oct 21 and Oct 22 are not as steep as between Sept 21 to Sept 22, which is not hard to achie…

They effectively said, "The increase went down." It would have been much clearer for them to say, "The increase has slowed."

Or clearer still "The increase is smaller than expected."

Re: US annual inflation declines to 7.7% in October vs. 7.9% expected

#132

Post by tootie »

tharne wrote: post #75
elil17 wrote: post #32

Earlier quoted context omitted.

It's not a lie, it's just not so simple that you can stop reading after the headline. This very post includes information about category-by-category inflation. Inflation for food has been about 10% YOY. Dairy is 15% and fresh milk is 14.5% (13.2% for whole milk and 15.4% for 0, 1, and 2% milk).

The numbers are a lie, or at the very least, vastly understate the impact. For example, if I used to buy grass-fed beef, but am now buying the grade D crap because prices are so high, that doesn't get captured in the inflation numbers. And there are a whole host of things like that; you'll notice many hotels have scaled back on cleaning frequency but the price of a room hasn't gone done, so you're paying the same for…

The headline inflation number is not at all intended to state the impact of anything. It's an aggregate number used as an indicator to inform macro policy. BLS reports all of the granular data points that roll up to the headline number. Your personal experience will absolutely never be accurately reflected in a single number for the nation. People hone in on food and energy because they buy them frequently and demand is inelastic, but they are by far the most volatile and can be affected by all sorts of heterogeneous inputs. National numbers will be heavily impacted by infrequent, larger purchases like housing and cars and other durable goods. The affects of inflation can hit certain verticals harder or softer. They can also be heavily regional. They can affect suburbs differently than urban residents (gas in particular doesn't affect subway riders).

Go click through the BLS site for CPI reporting: https://www.bls.gov/cpi/

Re: US annual inflation declines to 7.7% in October vs. 7.9% expected

#133

Post by ceejayoz »

koolba wrote: post #96
ceejayoz wrote: post #65

Earlier quoted context omitted.

How did student loan cancellation reverse inflation reduction when it's on hold due to legal challenges? No one has received a penny.

> No one has received a penny. The Biden administration mailed student loan checks to people (conveniently set up to arrive just before the most recent midterm): https://www.foxbusiness.com/personal-finance/student-loan-re... The checks are "rebates" for people who paid their student loans during the moratorium. The idea is to reimburse those people and add back their student loan debt so they can claim the maximum $…

That's not the student loan cancellation program.

Those are people who overpaid during the pause in payments. It's as inflationary as getting a tax refund in April.

Re: US annual inflation declines to 7.7% in October vs. 7.9% expected

#134

Post by sillyquiet »

Forgeties79 wrote: post #111
giantg2 wrote: post #93

Earlier quoted context omitted.

Many Americans are illiterate on numbers and the economy too. I still remember the classic example that a burger chain released a 1/3 pound burger to compete with another chain's 1/4 pound burger, and many people thought the 1/4 pound was bigger... Edit: there are some people saying it's a myth, or not a complete picture. Looks like we don't have the data. But my point is that we aren't very good with numbers or econ…

I’ve always thought this was somewhat apocryphal/a myth. Did it actually occur?

this is a 'haha Americans so dumb' myth that's been blown up - it's the result of a NY Times article that outline a private restaurant chain focus group result.

So tldr; some people in a private focus group questioned the value of a 1/3 pound burger over the same priced 1/4 pound burger. It's not indicative of any system numerical illiteracy.

I will add there were no actual data released - it's solely based on an anecdote from a A&W restaurant executive.

https://skeptics.stackexchange.com/questions/28745/did-aw-cu...

Re: US annual inflation declines to 7.7% in October vs. 7.9% expected

#135

Post by PopAlongKid »

InTheArena wrote: post #5
danuker wrote: post #2

Finally the mania is slowing down. It seems the rate hikes and layoffs are working.

Probably too strong of a statement. I don't view this as a huge miss (.2%), and ask anyone you know on a fixed income what this is doing to their retirement. Ulitmately, it's the glut of cash out there (IMHO) that is going to need to resolve itself before inflation gets back to a normal level.

>anyone you know on a fixed income what this is doing to their retirement

I don't know any retireees on a fixed income. They all get Social Security, which is not fixed. And if they have any signifcant savings, those interest rates are also not fixed, and have been rising a lot recently (recently advertised CD rates at 3-4% are common where I live).

Re: US annual inflation declines to 7.7% in October vs. 7.9% expected

#136

Post by FollowingTheDao »

lunaru wrote: post #31

It bears repeating because this is a common mistake in inflation discussions: a decrease in inflation metrics means price increases are slowing down, it doesn’t mean that prices are going down （that would require a negative CPI print). Also, this number is year over year, so the decrease just means the price increases between Oct 21 and Oct 22 are not as steep as between Sept 21 to Sept 22, which is not hard to achie…

And I find it hysterical that the 10 year Bond dropped 4% because of this. They think this is the peak, as in the Fed will stop raising interest rates and inflation will only get lower from here.

A good time to but the 10 year Bond IMHO.

Re: US annual inflation declines to 7.7% in October vs. 7.9% expected

#137

Post by amanj41 »

lunaru wrote: post #31

It bears repeating because this is a common mistake in inflation discussions: a decrease in inflation metrics means price increases are slowing down, it doesn’t mean that prices are going down （that would require a negative CPI print). Also, this number is year over year, so the decrease just means the price increases between Oct 21 and Oct 22 are not as steep as between Sept 21 to Sept 22, which is not hard to achie…

Couldn't some goods in the basket be slightly negative while others are positive? For example if rent went down relative to last year's baseline but groceries, gas, etc were all very much up.

Re: US annual inflation declines to 7.7% in October vs. 7.9% expected

#138

Post by Gustomaximus »

keewee7 wrote: post #14

It's a bit higher in Denmark and I have a little too much stored as fiat in the bank. What is a safe asset to store value while inflation is >10% in a developed country?

I think its a hard call.

Real estate is inflated. Stocks are too, but seems less so than property, at least in Australia.

Traditional flight to safety like gold has significant gains last few years so are you buying another peak?

Meanwhile you know cash is devaluing 5-10% per year.

For my non-expert opinion I think Australia shares are fairly good relatively currently, but I say that as an Australian. Its reasonably valued compared to some of the markets, stable govt/economy with low govt debt as western nations go (consumer is high though). Shares will probably return dividends around 3-5% per year on a market tracking ETF, which should offset some drops while the market and inflation, and then you are in market for the turn as as the cycle flips and inflation has run I could see some sharp gains as companies revalue to the new cost bases.

Also I think a FSTE tracker wouldn't be so bad. Since Ukraine and general market drops these are off their peak pricing. US Id avoid as I think there's a bunch more to unwind both in the market, politically, plus govt debt (heading for 140% of GDP and showing no signs of slowing) so I would be hesitant market tracking there until things stabilise. That said there will always be amazing companies ongoing in the US if stock picking.

Im so far from an expert, so take all this with a shovel of salt. Keep things diverse. But overall I think a Aus/Eur market type tracker is probably a reasonably safe bet at the moment for a uncertain and unprecedented enviroment, and take the odd punt on companies that you think are getting trashed and fear has over taken. Keep some level of cash as if the markets do tumble you want to be able to go in, or generally have options.

I know nothing. Good luck.

Re: US annual inflation declines to 7.7% in October vs. 7.9% expected

#139

Post by thehappypm »

ceejayoz wrote: post #65
phpisthebest wrote: post #51

Earlier quoted context omitted.

There was no Anti-Inflation Act, there was a spending... SPENDING bill they claimed would lower inflation because it also included a very limited amount of deficit reduction which 1 week later they had spent like 3 times on new programs including the Student Loan Cancellation which reversed any inflation reduction the original bill could have had (which was nill in the first place)

How did student loan cancellation reverse inflation reduction when it's on hold due to legal challenges? No one has received a penny.

People don’t need to make payments, why bother making a payment if its going to get forgiven?
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