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

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

#541

Post by UncleMeat »

dcow wrote: post #206
danielmarkbruce wrote: post #185

Earlier quoted context omitted.

It may be - but to the above poster's point - if gas went up 20% in Jan of this year and then stays flat... is it helpful to think of prices as "going up" ? It seems misleading.

If the last time you looked was last year, then yeah. They went up this year. What’s misleading about reporting yearly percentage increases in prices? I’m baffled.

Imagine a more extreme case where we reported inflation over the past 50 years each month. Every month we compute the price of the basket 50 years ago and the price of the basket today and compare. This number would go up when the most recent month had more price increases than the month 601 months ago. It would go down when the situation was reversed. It would be a number, but it would tell you very little useful information.

It is also the case that going extreme in the other direction is ridiculous. Imagine a daily inflation measure. Also nearly useless. "Oh, prices were flat today so everything is fine."

Published inflation numbers in media are usually used to make either the claim "everything is fucked, you should be mad about public policy" or "everything is fine, you should be happy about public policy." To me, this means that the reported should ideally be tied to some cadence that matches public policy. I'm not sure what that cadence is.

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

#542

Post by UncleMeat »

lupire wrote: post #534
Dylan16807 wrote: post #447

Earlier quoted context omitted.

That data was picked by someone out of all the data in the world. That's where the agency is.

A Federal agency: BLS.

Sort of. BLS also publishes other numbers. Media outlets choose which one to report.

Consider how last month everybody was reporting Core-CPI because it was higher than overall CPI and therefore produced more urgent sounding headlines whereas earlier in the year when overall CPI was higher that was the reported number. Yes, headlines said "Core-CPI" last month but if you aren't careful you get a very incomplete picture of things.

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

#543

Post by gwright »

macksd wrote: post #312
unethical_ban wrote: post #279

Earlier quoted context omitted.

Sigh. The YoY is useful for businessmen and economists. People aren't checking their statements for milk prices from Nov 2021 right now. They just know "man it jumped up". The point is that the everyday person cares about jumps and trends, and hearing "20% YoY increase" for 12 months is misleading to someone not thinking about it in economists' terms. The fact a bunch of people here are debating what it means and how…

And yet that's the same kind of distinction that you need to understand to be able to make decisions about household debt. If we're honestly at the point where this is considered too confusing for the masses, I think I've stopped thinking democracy is a good idea.

Maybe that is why we have a republic with representatives? Of course we can just shift the discussion to point out that US Congress critters don't seem to have a strong grasp on these topics either. :-(

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

#544

Post by tekknik »

RC_ITR wrote: post #470
tekknik wrote: post #430

Earlier quoted context omitted.

> The only reason you’ve ever drank a coke is because of these ads. This isn’t true in all cases. When I first drank a coke I was very young and wasn’t even aware of advertising. The first coke I drank was because my parents took me to McDonalds and that’s all they sell. Then I found I preferred it over Pepsi. Advertising had very little to do with my first coke, it was more contracts with fast food companies.

> it was more contracts with fast food companies. Also known as 'advertising.' (Coke has an insane amount of control over how their products are sold at McDonalds, down to how the soda fountain equipment can look) Why do you think PepsiCo Bought KFC/Pizza Hut/Taco Bell (before spinning them back out as Yum!)? Coke spends money so that every time you are thirsty you reach for a Coke, and part of that is the immense am…

You have really loose definitions of advertising. At any rate I’ll say it again, advertising had no effect on me trying or continuing to drink coke. I’m not sure why you’re demanding to be right here on something so simple.

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

#545

Post by tekknik »

kelnos wrote: post #488
tekknik wrote: post #430

Earlier quoted context omitted.

> The only reason you’ve ever drank a coke is because of these ads. This isn’t true in all cases. When I first drank a coke I was very young and wasn’t even aware of advertising. The first coke I drank was because my parents took me to McDonalds and that’s all they sell. Then I found I preferred it over Pepsi. Advertising had very little to do with my first coke, it was more contracts with fast food companies.

> Then I found I preferred it over Pepsi. You "found" that either because of advertising, or because you were primed to like Coke more because of your childhood experience. And the reason McDonald's only sold Coke? Advertising, of course. McDonald's believed they were better off selling Coke over Pepsi. Advertising is everywhere. I try to avoid advertising as much as possible (adblockers, never watching ad-supported…

Maintaining a contract with a company is not advertising. It was simply matter of convenience. I could have easily been taken to taco bell and my first soda would’ve been a pepsi.

Coke does not pay to be in fast food restaurants. It’s the other way around. This would be the weirdest form of free advertising, but I think people are using that term very loosely in this thread.

Except when I watch broadcast TV and some TV shows with products embedded, I do not see ads. But the first time I had a coke was long before adblockers existed.

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

#547

Post by bombcar »

lotsofpulp wrote: post #74
Spivak wrote: post #45

Earlier quoted context omitted.

Yes but that doesn’t mean we can’t have different baskets and look at that. Because “staple inflation” which covers food, water, electricity, gas, transportation, rent, and healthcare would be more useful measure for most Americans. 7% inflation with the current basket is meaningless to everyone but economists, but 20% inflation on the major household expenses tells you how much your bills are going to go up in real…

No one is forcing anyone to use one basket.

Everyone seems to be forcing me to sit in this hand basket that says "TO HELL" on the side, though.

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

#548

Post by tharne »

roflyear wrote: post #97
tharne wrote: post #75

Earlier quoted context omitted.

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…

Stop eating meat. You don't have to eat meat.

This puritanical mindset is part of the reason we've made so little progress on things like climate change. When you're first recommendation is for people to live more impoverished lives, don't be surprised when your ideas don't get the traction you think they should.

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

#549

Post by techlover14159 »

yCombLinks wrote: post #469
passwordoops wrote: post #193

Funny how markets and analysts lose their minds when the numbers don't match exactly the predicted when there are no error bars associated to either the estimate or the value. Coming under or over is a lot different when we're talking +/- 0.05 vs. 0.5... And yes, I tried checking. The Fed does put out their data, but nary a precision factor to be found

It wouldn't matter at all if the fed didn't put in a prediction. You can calculate what inflation level the market is predicting by looking at inflation swaps. When the official rates come out the market reacts to divergence from that prediction.

Is the pricing data for inflation swaps publicly available?

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

#550

Post by JumpCrisscross »

treis wrote: post #468
JumpCrisscross wrote: post #219

Earlier quoted context omitted.

Which is partly what we’re seeing. CPI rose 0.4% MoM in October, or 4.8% seasonally adjusted. That’s above target, but better than YoY.

Seasonally adjusted != multiply by 12. Prices naturally fluctuate throughout the year due to weather, consumer patterns, and business cycles. Seasonal adjustment is an attempt to account for those changes.

> Seasonally adjusted != multiply by 12

My brain swapped annualised with seasonally adjusted. Sorry.

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