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U.S. Inflation Accelerates to 40-Year High

wsj.com

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Re: U.S. Inflation Accelerates to 40-Year High

#111

Post by Rebelgecko »

tagoregrtst wrote: post #100
teraflop wrote: post #49

As usual, take headlines about inflation with a grain of salt. Yes, the year-over-year inflation reached a new peak. But the month-over-month inflation rate has actually been declining since last October: https://www.bls.gov/news.release/cpi.nr0.htm So when organizations publish a new article every month saying inflation is "accelerating", they're being incredibly misleading.

My math might be wrong, but according your source isn't the annualized month-to-month inflation 7.5%? (1+0.6/100)^12 = 1.0744. The year-to-year (multiply all seven rates and then power to 12/7) is 7.1% which is pretty close to 7.5% anyway. (Also, note that the decrease over the last two months is probably due to the Christmas peak ending. Best case scenario, pie in the sky, for inflation is 3.6% which is higher than…

If you still have a lot of time left on your mortgage it may be beneficial to refi

Re: U.S. Inflation Accelerates to 40-Year High

#112

Post by chasd00 »

eldavido wrote: post #81
logicalmonster wrote: post #19

Does anybody believe that the 7.5% figure is completely accurate and not fudged and massaged to give an answer that won't entirely spook the market? It feels like their strategy is to avoid making a choice and letting the bubble unwind as slowly as possible to avoid political fallout. Unfortunately, we learned as kids that ripping off a bandaid faster is usually best, so this might prolong pain for a while.

Keep in mind "7.5%" is the aggregate across the entire basket. This isn't how individual people perceive inflation. What actually happens is that a few things make big jumps (10-15%) and the prices of other things don't increase as quickly. Maybe not the nicest thing to say, but I'm hardly affected by inflation at all. The four biggest categories to experience inflation recently have been used cars, petroleum, rents,…

i have a variable rate loan on 20 acres that's making me nervous. I'm going to start researching options to rolling that into a fixed rate somehow before the Fed does the inevitable.

Re: U.S. Inflation Accelerates to 40-Year High

#113

Post by vsskanth »

ck2 wrote: post #88
eldavido wrote: post #27

Earlier quoted context omitted.

> a good reason to never let rates get this low in the first place My brother-in-law remarked that "the fed is overdue to raise rates". My reply: asset prices don't matter to ordinary people. You already know this, but the Fed's mandate is "price stability and full employment". Full employment is going great -- the job market is tight, low-end labor is seeing lots of wage growth, everyone who wants a job is getting o…

Rents are 18-21% higher now as leases expire. It's massive, some people more than $100 per month increase. The waves of homelessness and people living out of their cars starts in a few months. https://www.apartmentlist.com/research/metro-rent-changes-18...

Can confirm anecdotally. Ending my 2BR apartment lease at 963/month to move into a house in a different location. Currently being re-listed at 1300/month.I was paying 850/month last year.

Last year I looked at renting a similar 2BR apartment in the new place, but prices jumped from 1300/month to 1650/month in like 6 months. So just went ahead and bought a house.

Re: U.S. Inflation Accelerates to 40-Year High

#114

Post by JaimeThompson »

dcolkitt wrote: post #69
bryanlarsen wrote: post #50

There are many competing theories for this inflation: 1. The increase in money supply. 2. Supply chain bottlenecks. 3. Corporate greed & tech monopolies. 4. Fundamental supply constraints. (mostly in the housing sector) Anybody trying to tell you that it's only or primarily one of them has a political motivation. It's all 4, with the first 2 being primary and both being important. To effectively solve inflation we ne…

I'm sorry, but "corporate greed" doesn't make sense. Were corporations not greedy in 2017?

https://www.nytimes.com/2021/12/27/business/beef-prices-catt...

"Since the 1980s, the four largest meatpackers have used a wave of mergers to increase their share of the market from 36 percent to 85 percent...Their dominance has allowed them to extinguish competition and dictate prices."

https://twitter.com/AlecMacGillis/status/1476219789899096064

Re: U.S. Inflation Accelerates to 40-Year High

#116

Post by vkou »

djrogers wrote: post #58
eldavido wrote: post #27

Earlier quoted context omitted.

> a good reason to never let rates get this low in the first place My brother-in-law remarked that "the fed is overdue to raise rates". My reply: asset prices don't matter to ordinary people. You already know this, but the Fed's mandate is "price stability and full employment". Full employment is going great -- the job market is tight, low-end labor is seeing lots of wage growth, everyone who wants a job is getting o…

> What does matter is ... (rental affordability) Rental affordability is 100% correlated to asset pricing.

This is where you're wrong. It's the other way around.

Asset pricing is what's correlated to rental affordability. If the tenant class, in general, can't afford rent increases, rent won't increase, and real estate asset prices will stop growing, all other things being equal. Obviously, if money becomes cheaper for landlords, then they will borrow more of it to buy the same properties. But this does not give them any more power to unilaterally set rents.

But all in all, the tail does not wag this dog.

Re: U.S. Inflation Accelerates to 40-Year High

#117

Post by scottiebarnes »

marricks wrote: post #14

Inflation is a good thing for people with a lot of debt but not a lot of money. Think of the millions of student debt borrowers. Even if student debt isn't cancelled, it may get effectively cancelled one way or another. Which just goes to show, if WSJ or Bloomberg say something is bad, it may not actually be bad for you. Let's just hope the pressure stays up so wages keep on increasing. EDIT: I'd like to add, wage gr…

Anyone with debt gets a win when inflation is high, as it basically shrinks their debt.

Its a good thing in the short term for a specific group of people, but generally not good at all for the macro-economy or society in the long run.

You see the consequences of low interest rates in other ways, ie housing prices.

Re: U.S. Inflation Accelerates to 40-Year High

#118

Post by djur »

dahfizz wrote: post #42
jquery wrote: post #20

Earlier quoted context omitted.

Isn’t some of this just a reversal of stuff like oil being negative, and supply chain shocks due to factories shutting down for Covid? Some of it is certainly transitory.

For some definition of transitory, all inflation is transitory. That's a pretty useless definition. 2 full quarters of inflation well beyond target levels (with an accelerating trend) goes beyond a transitory event, in my opinion.

The trend for month-over-month inflation is slowing, not accelerating:

https://tradingeconomics.com/united-states/inflation-rate-mo...

Re: U.S. Inflation Accelerates to 40-Year High

#120

Post by hedora »

ck2 wrote: post #88
eldavido wrote: post #27

Earlier quoted context omitted.

> a good reason to never let rates get this low in the first place My brother-in-law remarked that "the fed is overdue to raise rates". My reply: asset prices don't matter to ordinary people. You already know this, but the Fed's mandate is "price stability and full employment". Full employment is going great -- the job market is tight, low-end labor is seeing lots of wage growth, everyone who wants a job is getting o…

Rents are 18-21% higher now as leases expire. It's massive, some people more than $100 per month increase. The waves of homelessness and people living out of their cars starts in a few months. https://www.apartmentlist.com/research/metro-rent-changes-18...

Yes, and there's a massive labor shortage too. Apparently people won't work for starvation wages.

It'll work out in a year or so, or we'll get hit with hyperinflation.

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