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U.S. inflation cools again, giving Fed room to downshift on rates

bloomberg.com

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Re: U.S. inflation cools again, giving Fed room to downshift on rates

#51

Post by oneoff786 »

smileysteve wrote: post #45
rsynnott wrote: post #30

Earlier quoted context omitted.

If the only thing you eat is eggs, then you're a weird edge-case not accounted for in the standard inflation figures, of course.

Eggs are one of the cheapest and cleanest proteins; They're also used extensively in baking from breads, brownies, cakes, and pastas. I eat 3 eggs a day for breakfast, 4+ days a week for the last 25 years.

Ok so one carton of eggs a week.

Also, it seems pretty silly to talk about a dollar of extra cost as a problem in the context of making homemade pasta. Homemade pasta is a time intensive luxury.

Re: U.S. inflation cools again, giving Fed room to downshift on rates

#52

Post by throw0101a »

smileysteve wrote: post #38
roywiggins wrote: post #25

Earlier quoted context omitted.

How much of the average shopper's budget is eggs? If it's not that big a percentage then you're just not going to see it in the overall inflation rate, and you wouldn't expect to .

Eggs are significant ingredient in many homemade things (eggs, bread, pancakes, pastas, brownies) and one of the cheapest,cleanest protein sources in the American diet. The Aivian flu + inflation caused a carton of 18 eggs to increase in price more than 50% recently ( $7.50). My household has fought this increase by increasing mushrooms and spinach in our eggs, and recently hybridizing with liquid egg whites.

> Eggs are significant ingredient in many homemade things (eggs, bread, pancakes, pastas, brownies) and one of the cheapest,cleanest protein sources in the American diet.

Yes, and food makes up ~13% of the BLS CPI. This is taken into account when they do their surveys to see what people are spending their money on:

* https://en.wikipedia.org/wiki/Consumer_Expenditure_Survey

Remember that the CPI is the national average inflation for an average basket of goods, and not your personal inflation. In Canada, StatCan actually has a personal CPI tool so that you can see how things are for your personal basket of goods:

* https://www150.statcan.gc.ca/n1/pub/71-607-x/71-607-x2020015...

Re: U.S. inflation cools again, giving Fed room to downshift on rates

#54

Post by vondur »

shmatt wrote: post #6
jollyllama wrote: post #3

>Excluding food and energy

* Food at home +0.2%, smallest since March 2021 * Fuel oil -16.6%, biggest decline since February 1990 Seems important to point out to anyone reading your comment

Ha. Our natural gas bills in my area doubled this month.

Re: U.S. inflation cools again, giving Fed room to downshift on rates

#55

Post by pwinnski »

lettergram wrote: post #15
shmatt wrote: post #6

Earlier quoted context omitted.

* Food at home +0.2%, smallest since March 2021 * Fuel oil -16.6%, biggest decline since February 1990 Seems important to point out to anyone reading your comment

1. There are things like “shrink-flation” not captured. I’ve noticed most packaged goods have reduced in size 10-20%. Eggs have more than doubled, milk is up 25%, etc I don’t care what the government publishes. My friends around the country all confirm this. My own bills (I track itemized) show it as well. Though, to your point, much of the increase occurred in 2021 - it just never came down. 2. Fuel is only down bec…

1. Nobody is saying that there has been deflation, so yes, prices that have gone up will remain up. The old baseline, the one in your head, that's gone. The question now is will prices keep going up, and the answer seems to be no.

In addition, a series of issues unrelated to monetary policy have hit individual items like eggs (avian flu) and lettuce (INSV) and so on, because food is messy.

2. The election season has been over for two months, and yet the SPR is continuing to contribute to US supply[0], so apparently not everybody thinks solely in election terms.

Russia is more complicated; they are at least as focused on their limited opportunities to earn and spend money given sanctions as on hurting us, which they might see as less easy to do now that the election season has been over for two months.

0. https://ycharts.com/indicators/us_ending_stocks_of_crude_oil...

Re: U.S. inflation cools again, giving Fed room to downshift on rates

#56

Post by f5ve »

dannyz wrote: post #17

Annualized over the last 6 months inflation is now under the 2% target. I would be surprised if we see anything more than a quarter-point at the next meeting.

Do you have a source for this?

I couldn't find this particular piece of data published anywhere, but I did a little math and arrived at an annualized rate of inflation for the last 6 months of 5.85%, well above the 2% target.

Re: U.S. inflation cools again, giving Fed room to downshift on rates

#57

Post by UncleMeat »

smileysteve wrote: post #45
rsynnott wrote: post #30

Earlier quoted context omitted.

If the only thing you eat is eggs, then you're a weird edge-case not accounted for in the standard inflation figures, of course.

Eggs are one of the cheapest and cleanest proteins; They're also used extensively in baking from breads, brownies, cakes, and pastas. I eat 3 eggs a day for breakfast, 4+ days a week for the last 25 years.

That's 12 eggs a week. So if the price of a dozen eggs has gone from $2 to $5 you are out... $150 a year. And that's for a sizable outlier in egg consumption. It isn't hard to see how this doesn't push overall inflation very meaningfully.

Most store-bought dried pasta has zero egg in it.

An entire homemade cake has like three eggs in it. So the price of an entire cake is up less than a dollar. How many cakes does the average household bake in a year?

Re: U.S. inflation cools again, giving Fed room to downshift on rates

#58

Post by pwinnski »

markus_zhang wrote: post #41
ryhn22 wrote: post #36

Earlier quoted context omitted.

Can you add something to the discussion by either sharing what your records show for you personally or addressing why a large/broad dataset is "meaningless" in the face of your smaller dataset?

It's meaningless because every individual follows his or her own life. For example, getting a new house might increase your rent while the "average" rent drops. What I'm trying to say is, unless for investment or research, these data doesn't have much to do with we as individuals. You can see people arguing that "You all feel X goes up but I don't feel that", and I'm just saying the same thing but from a different pe…

Mostly people arguing that the numbers are "wrong" are misunderstanding what low inflation means. Low inflation means prices won't continue to rise. It does not mean that prices will come down. The prices you remember from two years ago, they're gone. They're not even considered when calculating inflation numbers now.

Re: U.S. inflation cools again, giving Fed room to downshift on rates

#59

Post by adunsulag »

ceejayoz wrote: post #46
jollyllama wrote: post #27

Earlier quoted context omitted.

I'm not cherry picking. Produce is up massively. Heads of broccoli, lettuce, are up at least 20% over the last year! And that's IF you can find them.

That's further cherry-picking (and I've never been unable to purchase either; we eat brocolli 3-4x a week). The comment you replied to has the non-cherry-picked number for this month's report: "Food at home +0.2%" Some things went up more than others, some recovered faster, and without deflation the prices will remain overall higher than they were a year ago.

Perhaps its the people who cook with a lot of home ingredients (eggs, meats, vegetables, fruits) that are feeling the most pain. My food budget has gone up 25% in the last year for the same basket of goods. I track those numbers pretty consistently.

Re: U.S. inflation cools again, giving Fed room to downshift on rates

#60

Post by antisthenes »

ceejayoz wrote: post #46
jollyllama wrote: post #27

Earlier quoted context omitted.

I'm not cherry picking. Produce is up massively. Heads of broccoli, lettuce, are up at least 20% over the last year! And that's IF you can find them.

That's further cherry-picking (and I've never been unable to purchase either; we eat brocolli 3-4x a week). The comment you replied to has the non-cherry-picked number for this month's report: "Food at home +0.2%" Some things went up more than others, some recovered faster, and without deflation the prices will remain overall higher than they were a year ago.

At some point it stop being cherry picking and becomes an actual measure.

The official BLS numbers are underreporting inflation. Overall, groceries are up roughly 35-50% since 2020, while the official numbers would have you believe the inflation was 18.17% over 3 years.

BLS does a lot of trickery to generate favorable numbers. There are "quality" adjustments, there are "core" inflation indicators, which exclude goods with high price fluctuations (e.g. eggs).

I buy a pretty diverse basket of goods (groceries too) overall, and so far, none of the official inflation figures have even come close to my observed price increases.

Lumber, tools and hardware in home improvement stores are all up 30-60%. Food, like I said, is up 30% at minimum since the start of the pandemic.

Maybe clothes and TVs kept a stable price, but who cares?

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