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CPI for all items rises 0.4% in August, 2.9% YoY; shelter and food up

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Re: CPI for all items rises 0.4% in August, 2.9% YoY; shelter and food up

#91

Post by Workaccount2 »

duxup wrote: post #85
Workaccount2 wrote: post #73

Earlier quoted context omitted.

>The country will become industrialized for the wrong reasons -- by becoming poorer. Trump is a populist. That is the goal. The elite will get hammered and the bottom will be pulled up. The country will be net poorer, but the bottom will be higher than it was before. At least that's how the plan is sold on paper.

Trump is a populist in rhetoric only. I don't think his actions demonstrate he is a populist via policy. His excuses might be his rhetoric but his actions don't match.

https://en.wikipedia.org/wiki/Right-wing_populism

Populism is a spectrum (a horseshoe in many regards too), it's not just Bernie Sanders.

Re: CPI for all items rises 0.4% in August, 2.9% YoY; shelter and food up

#92

Post by skdjbd »

cs702 wrote: post #53

The Fed's inflation target is a long-term stable 2% annual increase in prices of personal consumption expenditures (PCE): https://www.federalreserve.gov/economy-at-a-glance-inflation... The motivation for 2%/year is that when inflation is lower, businesses and consumers tend to hoard more cash, instead of spending or investing it, reducing economic activity, and when inflation is higher, it tends to become self-reinf…

> The motivation for 2%/year is that when inflation is lower, businesses and consumers tend to hoard more cash, instead of spending or investing it, reducing economic activity

That’s what they say. In reality, inflation is a permanent tax on those who earn money through labor. Every greenback they print makes 90% of us a little poorer, and conversely makes the capital holders richer.

Popular economists should be thought of as a priestly class employed to enforce this order with explanations like the one you gave above. Defending a system that has resulted in an ever increasing wealth gap and the proliferation of businesses who optimize for accumulating capital is indefensible.

There are other systems (https://en.m.wikipedia.org/wiki/Social_credit). The economy should serve the people, not the elites. It’s hard to read a lot of economic discussion when the system is so fundamentally flawed. It’s not workable as is.

Re: CPI for all items rises 0.4% in August, 2.9% YoY; shelter and food up

#93

Post by 9rx »

skeezyboy wrote: post #90
9rx wrote: post #86

Earlier quoted context omitted.

No. Can't happen. Saying "I will sell you this widget for no less than one billion dollars!" doesn't establish a price. Price is not determined until a voluntary transition takes place. And a voluntary transaction fundamentally cannot take place without a buyer willing to pay the transacted price. As we saw in 2022, fear of starvation is a pretty strong motivator to see consumers wanting to pay more to secure their s…

> Price is not determined until a voluntary transition takes place youre talking about market value. price is definitely set before the transaction takes place. you can set the price at whatever you like.

> youre talking about market value.

No. I am talking about price. Price measures what you are giving up to receive value.

> price is definitely set before the transaction takes place.

No. You're likely thinking of an offer. Offers are made before the transaction takes place. Offers are spoken of in terms of the price the seller (or buyer) hopes to see, but it is not yet set. Negotiation can still occur at this stage, as can rejection.

Vendors with a lot of traffic are able to gain a pretty good handle on what consumers are willing to pay, so often, for all intents and purposes, the first offer and price end up being equivalent. Perhaps that is what you are thinking of?

Regardless, CPI looks at what consumers are actually buying. No matter how you want to define price in some sort of vacuum, price with respect to CPI can only increase if the buyers are willing.

Re: CPI for all items rises 0.4% in August, 2.9% YoY; shelter and food up

#94

Post by brendoelfrendo »

gruez wrote: post #5
buellerbueller wrote: post #3

Earlier quoted context omitted.

>Will the cut really help pull the labor market up? The capitalists don't care about the labor market as much as they do the stock market. In Trump's crazy Tilt-a-Whirl Policy and Tariff Generator (TM), what business would invest in expansion beyond what is necessary to grease the palms that need greasing? Way too much uncertainty. Time for stock buybacks.

>what business would invest in expansion beyond what is necessary to grease the palms that need greasing? Way too much uncertainty. Time for stock buybacks. AI and AI related companies are the opposite of this.

AI is not going to be able to grow geometrically forever. OpenAI and Oracle just signed a $300 billion contract. OpenAI doesn't have $300 billion. Oracle doesn't have enough chips on hand nor enough cash to buy them in order to fulfill these obligations. Based on RPO, Oracle is estimating that their cloud revenues will grow from roughly $10 billion now to $144 billion by 2030. That's insane, and yet it was enough to send their stock price up 25%.

Re: CPI for all items rises 0.4% in August, 2.9% YoY; shelter and food up

#95

Post by baby-yoda »

m101 wrote: post #80
baby-yoda wrote: post #38

Earlier quoted context omitted.

90% expected probability of a cut at the moment, down from 96% a week ago. A surprise no-cut would send a shock to the market IMO. https://www.cmegroup.com/markets/interest-rates/cme-fedwatch...

How these things are calculated is dumb: The market implied rate (from swaps/forwards curves) for the following period is something like 27bps cut, so they say: - 27 Is bigger than 25, so 0 cuts is 0% - attribute 2/25bps likelihood to 50bps cut - the remainder is left to 25bps cut The reality is that there's a non-zero probability to unchanged, and a non-zero probability of 75bps+ cut etc etc. However this informatio…

Great point - I never looked into the specific calculation but this makes complete sense as you explain it. Thanks.

Re: CPI for all items rises 0.4% in August, 2.9% YoY; shelter and food up

#96

Post by jghn »

notmyjob wrote: post #72
SR2Z wrote: post #23

Earlier quoted context omitted.

The "deportation of illegals" cannot reduce rents unless you think that undocumented workers are competing with Americans to pay $3k/mo rents in major cities, instead of living in RVs or cramming into small rooms. It can increase rents because immigrants build houses and do mental jobs like cleaning. > Could this be driven by the push to return to the office? A little. People still want to live in desirable areas for…

You cannot reduce rent period. Inflation is permanent typically, you can slow the rate of increase but prices don’t go back. Even massive building projects like the yimby’s lobby for can’t move the needle on housing costs according to economists who study the issue. If you are a renter in Silicon Valley you are absolutely competing with non-citizens who are paying 3k for 1 and 2 bedroom apartments. That’s why so many…

"non-citizens" and "undocumented workers" don't even come close to forming a circle in a Venn diagram.

Re: CPI for all items rises 0.4% in August, 2.9% YoY; shelter and food up

#97

Post by MattPalmer1086 »

skdjbd wrote: post #92
cs702 wrote: post #53

The Fed's inflation target is a long-term stable 2% annual increase in prices of personal consumption expenditures (PCE): https://www.federalreserve.gov/economy-at-a-glance-inflation... The motivation for 2%/year is that when inflation is lower, businesses and consumers tend to hoard more cash, instead of spending or investing it, reducing economic activity, and when inflation is higher, it tends to become self-reinf…

> The motivation for 2%/year is that when inflation is lower, businesses and consumers tend to hoard more cash, instead of spending or investing it, reducing economic activity That’s what they say. In reality, inflation is a permanent tax on those who earn money through labor. Every greenback they print makes 90% of us a little poorer, and conversely makes the capital holders richer. Popular economists should be thou…

We should not downvote a post just because we may disagree with it. That doesn't foster curiosity and discussion.

It's clear that continual inflation makes us poorer (unless we can also obtain pay rises). To me it's also clear that having no inflation (or indeed, deflation) would disincentivise investment. So I'm in favour of targeting a minimal inflation rate.

If there are other economic systems that would give both growth and better distribution of the proceeds of it, I'm all ears. I couldn't really understand the social credit link that was posted or how that might work.

Re: CPI for all items rises 0.4% in August, 2.9% YoY; shelter and food up

#98

Post by cosmicgadget »

bix6 wrote: post #2

100% odds the Fed cuts but inflation seems entrenched. Will the cut really help pull the labor market up? Tourism is down, AI is up, etc.

Would be funny if the FOMC postponed voting until after the courts make a decision on the Cook "dismissal".

Re: CPI for all items rises 0.4% in August, 2.9% YoY; shelter and food up

#99

Post by cosmicgadget »

andxor wrote: post #19
cj wrote: post #8

What is the target rate? Was under the impression that 2-3% is the target. Less than that is bad. More than that, also bad.

The target is 2 percent. Persistent 3 percent inflation is a whole different planet.

Ferenginar, after they abandoned the latinum standard.

Re: CPI for all items rises 0.4% in August, 2.9% YoY; shelter and food up

#100

Post by altcognito »

cj wrote: post #56
altcognito wrote: post #25

Earlier quoted context omitted.

2% was the target over the long haul (not 3%) -- BUT it is a dual mandate to keep unemployment to a minimum as well. This is considered on the high end of that part of the inflation mandate, and as another comment stated -- if it is persistent, it will be seen as a negative.

Compared to the past 12-24 months, 2.9% doesn't seem to be particularly worse than previous months. E.g. it was even higher at 3% at the beginning of the year and it has been at 2.7% for the past few months. Might not be at the 2% target, but at least looking at the graph, 2.9% isn't making me panic. Maybe the panic is warranted, I don't know. https://www.cnbc.com/2025/09/11/consumer-prices-rose-at-annu... Edit: Alth…

Oh, it's definitely not, and panic is definitely not called for.

I think that's why they feel they have the leeway to lower interest rates to combat weaker job numbers. I think the concern is that we'll paint ourselves into a corner and end up with interest rates persistently at double (or worse) the target.

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