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

https://www.bls.gov/news.release/archives/cpi_11102022.htm

by ericliuche • 4 years ago

403 467 4 years ago

danuker3• 4 years ago

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

InTheArena4• 4 years ago

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.

guiriduro• 4 years ago

But it does argue to permit the current tighter fiscal and monetary position to work as it appears to be doing, perhaps too well/quickly, rather than tightening more out of a dangerous over-abundance of caution.

danuker3• 4 years ago

Whether it's through consumer price inflation or bond devaluation, retirees are affected by the economy.

There is no instrument or policy isolating them from it. The best you can do is diversify.

PopAlongKid• 4 years ago

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).

FollowingTheDao5• 4 years ago

I agree. And buy the 10 Year Bond today, its at a great discount!

BuyMyBitcoins• 4 years ago

I feel like a .2 percentage point drop is near imperceptible and something easily subject to reversal. I don’t think we’re anywhere near an actual slowdown to inflation yet.

roflyear7• 4 years ago

That's not what this is at all. It's .2% under expectations. Not a .2% drop. But inflation is steadying which is good.

bushbaba• 4 years ago

(1-.4/.6) represents the actual percentage change. Actual CPI came in 33% lower than expected. Huge miss by the “experts”.

SantalBlush2• 4 years ago

For those who were wondering if we would officially be in a recession after November 8 elections, the answer is still "no".

InTheArena4• 4 years ago

It will take a quarter, but given the massive layoffs occurring now, the projections of early next year are looking spot on.

Inflation is a different problem.

SantalBlush2• 4 years ago

The argument being repeated here on HN wasn't that recession might happen in the future (which would be a true statement); the argument was that we've been in a recession since summer, but due to government propaganda and a media conspiracy, it was swept under the rug (which was false).

mi_lk• 4 years ago

the projections of early next year

where do you see that projection?

iav• 4 years ago

GDP grew +2% in Q3, after declining in Q1 and Q2. Gross Domestic Income (similar to GDP but measured differently) grew consistently the entire year. And unemployment rate has declined consistently every single month and stands at 3.57%. I think it would be hard to thread a needle to call any part of YTD 2022 as a recession with this kind of fact pattern. Only if unemployment rate starts to increase in a dramatic way can we really go back and say we were in a recession this year.

eloff2• 4 years ago

I agree with that, but mind you there are two kinds of job numbers. The household survey numbers and the official ones which mysteriously diverge from the survey before elections, but otherwise track nicely. There's some two million jobs that only exist on paper to benefit the incumbent government. This anomaly appears regardless of which party is in power.

lazar_guz_kemp• 4 years ago

Inflation was 0.4% month-over-month. This is the same rate we saw las month.

keewee7• 4 years ago

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?

akmarinov• 4 years ago

Real estate probably for medium term, stocks for long term.

nemo44x6• 4 years ago

Do you have inflation protected bonds? In the USA you can buy I-Bonds (max $10k/year per person) that pay interest at the current inflation rate.

But what is considered “safe” really has a lot to do with your timeline. How soon do you want to access the money? If it’s in tears then index funds are likely a good buy today.

coffeebeqn4• 4 years ago

There are also TIPS which don’t pay as well but you get back 80-90% of inflation as a dividend

988747• 4 years ago

Poland offers something similar, but with a twist. On the plus side, the amount you can buy is unlimited. However, interest rate is fixed in the first year, at 7% (which is a far cry from 17.9% inflation). From the year two the interest rate is inflation rate + 1% premium. You can buy either 4 or 10 year bonds.

andy_ppp• 4 years ago

Yes property, shares, gold, here is a fantastic breakdown on inflation and the COVID stimulus: https://www.youtube.com/watch?v=Qlr5Vzrextk

tharne• 4 years ago

The usual stuff - gold, silver, real estate.

riffraff• 4 years ago

Inflation linked government bonds from developed countries and your local currency or USD/EUR denomination, depending on your country you may get some tax advantages if you buy local ones. But you should probably have done this long ago, now it may be a bit late.

yourapostasy• 4 years ago

While that is better than nothing, for example US citizens are limited to only $10K USD in I-bond purchases per year per Taxpayer ID Number (TIN). Some people run their I-bond purchases through LLC's they control as well, but I don't know how the IRS would treat a fleet of LLC's set up purely just to get a TIN to use for buying I-bonds.

Oil and copper tends to follow inflation, but they're highly volatile so you can't rotate into them expecting good liquidity. If you hold say $100K+ USD you want to rotate and re-deploy after the carnage with fairly liquid assets at relatively low risk, then I can't think of much beyond take the hit in a conservative cash and select bonds positioned in a capital preservation posture, or Benjamin Graham-style conservative value equities.

cko• 4 years ago

Depends on your time horizon.

In the very short term, inflation linked bonds as other comments mention.

In the 15+ year bracket, probably equities.

Perhaps real estate at a low mortgage rate but it's not very diversified.

Gold is commonly touted as an inflation hedge, but that's over a much longer time horizon, probably longer than most people are alive.

In the end it really depends on the cause of inflation - expected vs unexpected, supply vs demand side.

patall• 4 years ago

Is gold still the inflation hedge? One the one hand yes, but if i.e SpaceX starship is a total success, asteroid mining could be the black swan for that. Though I may be totally wrong (and off by orders of magnitude) about that.

zmaurelius• 4 years ago

High dividend stocks have been a good bet and hedge in previous downturns. Individual stocks will have high variance, but a basket of high dividend stocks would be worth looking into.

Gustomaximus• 4 years ago

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.

quonn• 4 years ago

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

But are they? To me many stocks look comparatively flat over 30 years given the fact that they should point upwards just to correct for inflation in the currency they are denominated in and even more upwards when taking into account productivity gains.

fullstop3• 4 years ago

Thankfully you're no longer earning negative interest on your bank account.

aabceh• 4 years ago

It's funny how people freaked out over the -0.1% interest rate but don't care about having money in the bank when the inflation is at +10%.

fasteddie31003• 4 years ago

RANT: This inflation and coming recession is entirely on the hands of the current leadership in the Fed and Treasury. Their super-low interest rates over the years are coming full circle. We live in a centrally planned economy. My advice to the Fed is to set the Fed Funds Rate to equal inflation! This will stop the wild swings in the economy and keep inflation in check. When the Fed Funds Rate is lower than inflation there is an arbitrage opportunity for anyone who has access to this money to invest it broadly into the economy and get a positive return. I actually think this is a huge source of income inequality because only the most wealthy have access to this arbitrage opportunity, but that is another rant.

throwingrocks• 4 years ago

Yeah....and the inflation we're seeing elsewhere in the world is just a coincidence.

coffeebeqn4• 4 years ago

EU had negative interest rates for a decade. Low interest rates during the good times is definitely a mistake You end up paying for eventually

germandiago2• 4 years ago

there is some truth in that rant. The inflation, btw, can be imoorted via currency exchange.

For example, anything for which you pay in dollars (a strong dollar now) is more expensive. If you add the exchange rate to the fact of the inflation itself you end up paying the sum of both differences.

The strong dollar is also the reason why EU has no choice but to follow the interest rate escalation from dollars: if they do not do it, people run away to buy follars because the euro suffers depreciation.

Complex topic, with more ramifications than it looks at first.

starkd• 4 years ago

The US Dollar is a world currency.

HideousKojima• 4 years ago

Seeing as every single central bank has similar monetary policy to the US, and almost all governments in Europe and elsewhere injected huge amounts of cheap/free cash into their economies in attempts to counter the economic effects of lockdowns/Covid, it's anything but a coincidence. It's a confirmation that such policies do in fact cause inflation.

FollowingTheDao5• 4 years ago

"Elsewhere" they have also had 0% or even negative Central Bank Interest rates.

https://pearsonblog.campaignserver.co.uk/wp-content/uploads/...

eloff2• 4 years ago

Simple rules don't work with something as complex as the entire economy.

arcbyte• 4 years ago

Yup they should have been raising rates ~2013. US government should also have been starting to pay down debt in that time frame too. It's like blind men are at the wheel of the economy.

throw0101a2• 4 years ago

Their super-low interest rates over the years are coming full circle.

Super-low interest rates have very little to do with it. The Fed rate has been low for over a decade and inflation has only appeared recently:

* https://fred.stlouisfed.org/series/FEDFUNDS

Similarly neither has QE done much about consumer prices. People predicted the almost end of the financial world when QE started years ago and not much has happened in the intervening years; from 2010:

We believe the Federal Reserve's large-scale asset purchase plan (so-called "quantitative easing") should be reconsidered and discontinued. We do not believe such a plan is necessary or advisable under current circumstances. The planned asset purchases risk currency debasement and inflation, and we do not think they will achieve the Fed's objective of promoting employment.

* https://economics21.org/html/open-letter-ben-bernanke-287.ht...

Neither does money supply: Japan's M2 has been rising for decades and they've had low inflation (and even deflation) in that same period:

* https://fred.stlouisfed.org/graph/?g=PA7P

The current situation is partly due to velocity and the cheques that were sent out by the Treasury (not Fed) earlier in 2022. But also due to supply-side stuff life oil (see RU) and food (see RU). An SF Fed report estimates about half of the current US inflation is on the supply side/chain side of things:

* https://www.frbsf.org/economic-research/publications/economi...

nemo44x6• 4 years ago

This is especially good since it was a year ago we started to notice inflation rising rapidly. If this print was higher than expected it would have indicated something really bad. With this print we could be on the path to healthier inflation in the coming year.

nivenkos• 4 years ago

The US has it easy, since the inflation was largely caused by lockdown stimulus, and also benefits from being the global reserve currency so it can leverage cheap imports as the interest rate rises increase the value of USD.

I wouldn't be surprised if it's better in a few months, especially with the growing protectionism in the anti-inflation act, etc. and acts against Chinese competition, etc. keeping more industry in the US.

phpisthebest2• 4 years ago

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)

ceejayoz5• 4 years ago

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

roflyear7• 4 years ago

I wish the political people would go away from HN. The forum is becoming a rough spot.

Jerrrry3• 4 years ago

You are correct the anti-inflation act is hot garbage, and accelerated inflation immediately.

You are incorrect about the exact specifics about the Direct Student Loan program refunds - anyone who had made payments during the pandemic can be refunded.

You are still generally correct though - inflation is caused by several things, M1 and M2 money supply, employment, demand, supply, and sentiment.

Everyone not paying their loans decreased demand for jobs, as that was the primary motivator for many to work. Additionally, the money printed and disbursed to colleges not being paid back leads to another increase in money supply, since the money never gets repaid, and a few select loan companies are now holding very large U-O-ME's, which the department of education seemingly is going to average between all of us, by forgiving it, further adding to the printed money pile.

fundad2• 4 years ago

raising corporate taxes is anti-inflationary

dangerwill• 4 years ago

I too watch/read Peter Zeihan and think he has some insights, but please don't take it all on face value (industry is probably not coming back to the US in force, and shifts from China will be slow and painful)

mysecretaccount• 4 years ago

Zeihan is one of those commentators that seems to throw a bunch of wild predictions at the wall to be entertaining, appear insightful, and be able to say he called it when one of every dozen ends up being correct.

jklinger4102• 4 years ago

since the inflation was largely caused by lockdown stimulus

This is a widely disproved myth.

Jerrrry3• 4 years ago

Please explain how literally directly increasing the M1 money supply doesn't cause inflation.

Everyone got money for free. Things that are free, tend to have less value.

randomdata4• 4 years ago

The first order reason for inflation is, of course, a willingness to spend more. Prices flat out can't rise if buyers balk at a seller's higher expectations. Plain and simple.

But it is well understood that said willingness changes on what buyers believe[1]. If they believe that lockdown stimulus is causing inflation, it will cause inflation. The mere existence of lockdown stimulus won't cause inflation, but the emotional response to it very well could.

And given that this appears to be a widely held belief, something even some government officials trumpet as the cause of inflation, it seems unlikely that it isn't a significant contributing factor. How is this dispelled?

[1] https://www.brookings.edu/blog/up-front/2020/11/30/what-are-...

dchornyi• 4 years ago

Check this out: https://www.federalreserve.gov/econres/notes/feds-notes/exce...

Stimulus checks contributed $844 billion to the $1.7 trillion of excess savings we still had by mid-2022.

We estimate that households in the lower half of the income distribution were still holding about $350 billion in excess savings as of mid-2022—mostly stemming from the boost to income induced by fiscal stimulus in 2020 and 2021.

Personal consumption expenditure went up especially for the bottom income quartile, driven by stimulus. As soon as the bottom of the income distribution had extra money, they drove up the prices of things that are in the CPI.

In contrast, when the top of the income distribution has excess savings, they drive the prices of Tesla stock, NFTs, and real estate. Since they are not in the CPI, nobody cared and money printing could continue. This is what we had in 2010–2020. Direct money transfers to the poor were the thing that broke the system.

UncleOxidant• 4 years ago

I wouldn't be surprised if it's better in a few months, especially with the growing protectionism in the anti-inflation act

Wouldn't protectionism be inflationary?

allemagne• 4 years ago

Absolutely. Higher prices for the same goods, plus a stimulus to domestic industry.

Unless you are a savvy technocrat who knows where production bottlenecks are better than the market does, protectionism is just a welfare program at best and a cynical rent-seeking, vote-buying scheme at worst.

lunaru• 4 years ago

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 achieve because Sept 21 to Oct 21 had a bigger month over month jump.

The right way to interpret this number is that high prices have plateaued a bit. Yes that means your groceries are going to be x% higher than in 2020. Short of deflation, they always will be.

Victerius2• 4 years ago

For the mathematically inclined among us, dp/dt is still positive. It's d^2p/dt^2 that is slightly negative.

queuebert2• 4 years ago

Anyone who's ever had to numerically estimate second and higher derivatives from noisy data can appreciate how difficult the Fed's job is.

compumike• 4 years ago

For the mathematically inclined, here is a graph of 1/p over the past year:

https://totalrealreturns.com/s/USDOLLAR?start=2021-11-10&end...

or over a longer time period: https://totalrealreturns.com/s/USDOLLAR

(this site is my side project)

If "p" is the relative price level index (CPI-U in this case), then "1/p" represents the relative purchasing power of a single dollar over time -- explained on homepage in more detail.

redox99• 4 years ago

Not really.

It means CPI_oct22 - CPI_oct21 < CPI_sep22 - CPI_sep21

d^2p/dt^2 isn't necessarily negative.

contravariant• 4 years ago

Though the mathematically inclined should also know that we're not looking at dp/dt, we're looking at p(t) - p(t-T).

The difference is important, especially because we're looking at a yearly increase every month. The derivative of the annual inflation is not d^2p/dt^2 but (dp(t)/dt - dp(t-T)/dt).

germandiago2• 4 years ago

Well explained. Idk for english-speaking countries or your country of origin but the average spanish is an absolute illiterate in economy.

These explanations are very necessary so that people develop an intuition of what is going on.

giantg28• 4 years ago

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 economics.

https://www.scientificamerican.com/article/fractions-where-i...

https://www.stlouisfed.org/on-the-economy/2018/september/how...

lordnacho• 4 years ago

I have a degree in it and I often don't feel that I know anything. For a guy who did a lot of STEM economics is a pretty odd subject in many ways. A mixture of interesting insights, strange models, and a lot of soft talk.

Ar-Curunir• 4 years ago

I.e. the rate of price increase has slowed, not the price increase itself

maratc• 4 years ago

Prices are still increasing, and they are still increasing fast. It's just that recently, they increased even faster than now.

nashashmi• 4 years ago

Also it is worth mentioning that part of the major reason accounting for inflation is car price. It’s going down now as chip makers produce more and prices go down further.

onlyrealcuzzo2• 4 years ago

It's also going down because it's a debt market and financing is more expensive w/ used car interest rates at 9% instead of 4% and new cars at 5% instead of 0%...

nemo44x6• 4 years ago

Hopefully that helps with new car pricing. Dealers are still selling well above MSRP.

bryanlarsen3• 4 years ago

I expect the number of car sales in the US to go down significantly like it has in Europe. Interest rates are one major factor, but another is the electric transition. Anecdotally I know quite a few people that aren't buying new vehicles right now. They're the kind of people that buy a new car every 10 years or so, and are delaying their purchase or buying used. They realize it's a bad idea to buy a new gas car but aren't yet ready to buy an electric car because they don't understand them yet, they're too expensive, have a massive backlog, or don't come in the style/variant they want.

matwood• 4 years ago

And to add to your explanation, because inflation jumped so quickly and then slowed we'll eventually hit a YoY number that plummets. If milk is $4/gallon today and still $4/gallon 12 mos. from now, that's 0% YoY inflation.

This will inevitably lead to people saying the numbers are fake because milk used to be $2/gallon.

throw0101a2• 4 years ago

If milk is $4/gallon today and still $4/gallon 12 mos. from now, that's 0% YoY inflation.

Conversely, if there was a one-time jump in a particular item, it will take a year before it gets 'removed' from the inflation numbers.

Extremely contrived example: if gas/petrol was $1/L in December 2021 (and generally in all of 2021), but $1.20/L in January 2022, then there will be a 20% YoY jump in inflation for the January number comparing Jan 2021 to Jan 2022.

Now if gas stays at $1.20/L in February 2022, it will still register as 20% YoY even though the price has not changed month-to-month. That 20% (YoY) is "stuck" in the system until January 2023 when we're comparing $1.20/L to $1.20/L.

A one-time jump can 'skew' the numbers if all you look at is YoY metrics.

0x445442• 4 years ago

Especially when their incomes didn’t double.

bitshiftfaced• 4 years ago

Even in the early 80s after huge interest rate hikes, YoY CPI inflation stayed above 2% (until the mid 80s).

Rather than modeling it as "the price increases happened in a short period of time and then went back to normal," I think it's more likely that it happened more spread out and persistently, and perhaps still is going on. It's not going to jump to zero after some given month

mattferderer• 4 years ago

How to set inflation expectations - "Inflation shoots up like a rocket & floats down like a feather."

KptMarchewa• 4 years ago

Month on month numbers are still slightly up.

impulser_• 4 years ago

Don't be surprised when politicians use this to their advantage next year.

Am4TIfIsER0ppos• 4 years ago

If "inflation is transient" when is it going back to 2/gal?

coding1232• 4 years ago

It's bullshit because it's an average of everything that no one buys. My grocery bills have doubled since 2020, meaning my CPI was 100% over 3 years. I will not shut up as you and many others are trying to force me into accept it's 10% inflation.

olivermarks• 4 years ago

@matwood it is a disaster for working people regardless as wages are not keeping pace with the effects of inflation.

fleddr4• 4 years ago

Honestly, I'm with those people.

Your explanation is fully technically correct, but the subsequent messaging that inflation is zero is a matter of not reading the room.

When an important item dramatically rises in price, this can have a massive impact on people. A dramatic drop in purchasing power or even businesses needing to close. It is impactful.

When the price continues to be high, the impact remains. The pain continues, the problem is not solved. The politically smart messaging is to say "we feel and acknowledge your continued pain, this is what we're going to do about it", not "Good news! Inflation is 0%."

Same with the opportunistic messaging of sometimes using MoM or YoY, whichever number looks better. When MoM inflation in October is 15% and 5% in November, you really shouldn't bring this as good news. The situation still got worse in the real world.

Spooky23• 4 years ago

People who lack foundational skills in math are always vulnerable to being worried about witchcraft and conspiracy.

It’s a major reason why society spends so much on education. Stupid people make poor citizens.

thomastjeffery• 4 years ago

They effectively said, "The increase went down."

It would have been much clearer for them to say, "The increase has slowed."

onion2k• 4 years ago

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

laweijfmvo• 4 years ago

This is like the 3rd derivative, right? e.g. we now have a slightly lower rate of acceleration towards the cliff than before?

lottin2• 4 years ago

Year-over-year inflation doesn't tell us anything about whether prices are going up or down right now.

giantg28• 4 years ago

No historical data is going to tell us the future. But it can give us an idea of the trend, which is useful since in a large system like the economy the trend tends to change relatively slowly as compared to individual compentents.

ajross• 4 years ago

The right way to interpret this number is that high prices have plateaued a bit.

This part is true.

that means your groceries are going to be x% higher than in 2020

But this part jumps right back into the much bigger fallacy that inflation represents a change in value and not price! Sure, groceries are higher in price, just like your assets are higher in value (on average) and your wages are higher (on average).

But in any case, your notion that inflation isn't instantaneously halted is a little spun. In fact month-to-month CPI change for October is 0.4%, which corresponds to about 4.9% per year. That's higher than we've seen for most of the last decade, but not a number most people would consider "high" in the sense of "disruptive to economic activity".

anyonecancode• 4 years ago

I think of it like the accelerator pedal on a car. A decline in inflation means the foot has eased up on the accelerator some, but the car is definitely still moving forward.

FollowingTheDao5• 4 years ago

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.

datalopers2• 4 years ago

Why would you suggest buying a bond on the exact day that yields just plummeted.

amanj41• 4 years ago

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.

danielmarkbruce17• 4 years ago

You could just say: CPI is up 0.4% month-over-month. It gets reported.

msoad• 4 years ago

Inflation over the last year was 7.7% - if the October rate holds for a year, it will be under half of the last years inflation rate coming in at 3.6%

That’s the number that matters in a forward looking instrument like the market

danielmarkbruce17• 4 years ago

This isn't right. It could in fact mean prices are going down.

Had we just reported a month on month -0.4% instead of 0.4%, the yoy rate would have been reported as 6.9%. A headline of 6.9% would mean prices are actually going down.

meragrin_2• 4 years ago

Anything positive YoY means prices have gone up overall over the last year. For prices to have gone down in general over the last year, the YoY would have to be negative. A headline of 6.9% would mean prices have gone up.

rzimmerman• 4 years ago

Yes the YoY number is useful for getting rid of seasonal variations. The monthly CPI is also noisy. But when there’s a big spike over a few months (like we had 8-16 months ago) YoY won’t go down meaningfully for at least a year.

This is actually great (if noisy) news. 2 months of 0.4% CPI increase is equivalent to 5% yearly inflation. But the YoY is still high because it was much worse 8-12 months ago.

I hadn’t even considered that people will think low numbers are a lie because prices don’t go down. But of course (sadly) you’re right.

lupire4• 4 years ago

The seasonality aspect is a distraction when inflation is so volatile due to all the pandemic craziness.

fakethenews20222• 4 years ago

Many words for something that can be explained by a single cumulative CPI graph.

fakethenews20222• 4 years ago

Of course it probably needs a second graph under it of 2% cumulative CPI for comparison.

la64710• 4 years ago

Which businessman in their right mind will decrease the price of their products because of cost decrease? Not unless there is intense competition. Because of that for large scale monopoly business like commodities once the prices go up it may not come down again.

Green_man• 4 years ago

I may be missing something, but if there is no competitive pressure/monopolistic market, why would these businesses need the excuse of inflation/cost increases to increase their prices? Wouldn't we expect prices to have gone up before inflation?

Or is this a specific criticism of a regulatory blind spot for reigning in market power? Monopolies can get away with price increases now, but they wouldn't normally?

jliptzin• 4 years ago

If you sell commodities that is literally the opposite of a monopoly

WanderPanda• 4 years ago

You mean a negative CPI growth / CPI decline, right? With a negative CPI stuff would be free + we would be getting money on top (on average) :D

I think the best way to understand it is to just look at the index itself [1] and not the first or second derivative.

[1] https://tradingeconomics.com/united-states/consumer-price-in...

sonthonax• 4 years ago

As a general consumer, the slowdown in the erosion of my earning power is welcome news. My gamma hedging hedging costs have never been lower.

citilife• 4 years ago

The number is largely manipulated anyway. It's more complex than even this because you have to account for price elasticity. They are giving oil a very wide fluctuation, for instance.

I've been tracking my expenses since 2015 and they're up around ~50% since then, for effectively the same food (eggs, bread, meat, etc). I eat ~2800-3000 calories per day (which I also track) and that's been consistent.

According to BLS it should be up only 27%, but everyone knows that's just not true. Remember ~1 year ago when the administration was calling prices "transitory", that means they're claiming a larger elasticity in prices so inflation doesn't look bad because they believe they'll come back down (soon).

alooPotato3• 4 years ago

Anyone else feel like this is such a dumb way for the general public to track inflation. Like, a simple line chart with the X axis being time and the Y axis being the price of a basket of goods would be so much clearer

boppo1• 4 years ago

That's why we don't use it.

randomdata4• 4 years ago

Is inflation (meaning CPI figures) meant for the general public? It's a useful economic tool, but not very relevant to the average Joe. I would think expansion of cost of living is what the general public is interested in, and for that they have to track their spending, and can do so in any way they see fit.

kelnos4• 4 years ago

Sure, but this is still exactly what we want to see. If the target is 2%, YoY metrics moving in that direction is a positive step.

The only thing we can hope for is that, as inflation numbers continue dropping back toward "normal", wage increases will eventually catch up and make those already-higher prices less difficult to swallow. Of course, it never works out that neatly.

isusmelj• 4 years ago

The way I read it the price of things like eggs increased by 43% (on table 6 which is seasonally adjusted it's still 10%)? Does anyone know why?

jeffbee• 4 years ago

Lack of low-wage immigrant labor to fill farm jobs. https://www.economist.com/united-states/2022/07/28/a-shortfa...

giantg28• 4 years ago

I'd imagine it's more likely due to energy prices associated with the chicken houses, and the virus (bird flu I think) they've been dealing with.

mrguyorama2• 4 years ago

Our local egg prices in Maine doubled, supposedly because we got hit bad with bird flu and had to cull a lot.

pmoriarty• 4 years ago

I was just reading "Ray Dalio on the Downturn: 'There's a Lot More to Come'"[1], which said:

Inflation in the United States has risen 8.2 percent in the past 12 months. While the Federal Reserve’s long-term inflation target is 2 percent, Dalio predicted that the central bank will go for a more realistic target of around 4.5 to 5 percent.

Based on those numbers, he believes the real interest rate could land in between 4.5 percent and 6 percent. “Six starts to break things pretty bad,” Dalio said. “The vicinity of 4.5 and 6 may be the number in terms of cracking the thing.”

[1] https://www.institutionalinvestor.com/article/b20hpgzhxph5h5...

carom2• 4 years ago

Ray Dalio has been calling for a massive unwinding for a long time. It has gotten really tiresome.

shostack• 4 years ago

The way he writes I can't help but think he has a large position that hinges on the US falling as a world power and the dollar losing reserve currency status.

photochemsyn• 4 years ago

Isolated data points aren't really worth analyzing - something like a running 6-month average makes more sense. See this 2009 blog post on how to inflation-adjust current prices/revenues to those from decades before:

"For this exercise, we’ll use the annual average CPI-U values for 1973 (44.4) and 2008 (215.303). Because the CPI-U includes relatively volatile items such as food and fuel, I tend to avoid the monthly values with their fluctuations. If you want to adjust to the most recent data available, consider averaging the most recent six months of CPI-U values."

https://anthonydebarros.com/2009/11/01/adjusting-for-inflati...

This is similar to analyzing climate trends, where you really want to look at 5-year running averages (possibly 10-year). Generally, 'response time of the system to forcing' is what matters, in both cases.

abeppu• 4 years ago

Isolated data points aren't really worth analyzing - something like a running 6-month average makes more sense

Isn't the YoY inflation definitionally equivalent with running (geometric) mean of the past 12 (annualized) monthly increases?

seydor• 4 years ago

So, when will the US Fed announce its own layoffs? They need to contribute to bringing down inflation.

queuebert2• 4 years ago

Lies, damned lies, and statistics.

hnburnsy• 4 years ago

Anyone notice that brand name soda (looking at you Coke) has increased almost 100% while the generic/house brand has had slight increases. I feel like Coke is testing the pricing limits of its customers especially with the smaller packaging and these prices will not come back down.

theyeenzbeanz• 4 years ago

A 20oz bottle is easily 2.29 now compared to roughly 1.79 not long ago.

jackcviers3• 4 years ago

I remember when it was $1 for almost 7 years, then went to $1.49. It hurt because now you had to feed 2 bills into machines that could barely take 1 reliably, and were always out of change.

How that didn't drive the price back down to $1 or up to $2 I'll never understand. It had to have increased labor on the parts of the vendors and decreased demand for the vendors at the same time. That's about the time I started just stocking a 6 pack or 2 liter (depending on which was cheaper per oz) in the fridge for the week, too, which drops the unit price.it also decreased the total volume of soft drinks that I bought.

I don't know how soft drinks can continue to increase in prices under that dynamic. My guess is that the majority of people just buy it and don't notice anything that costs less than $10 anymore, so convenience stores can get away with movie theater prices as long as they don't cross that trivial threshold. People will pay for convenience under $10.

kennend3• 4 years ago

As someone who use to drink a lot of coke and quit.. this is very true here (Ontario, Canada) as well.

I remember buying 2L bottles for $0.99 on a regular basis (they often had sales). I don't drink it anymore (one month and counting) but i do check the prices weekly out of habit and never see it below $2.29/2L now?

I actually just checked and it has gone up in price once again, now $2.49/2L

Crazy.

vikingerik• 4 years ago

This price has everything to do with what consumers will pay for convenience and almost nothing to do with manufacturing costs, which are a tiny fraction of that. (Shipping and delivery are probably more, both for energy and labor.)

Sellers do not determine the market price for anything. Buyers do by what they will pay. Sellers can specify a price, but any transaction actually happening is only determined by the buyer. (Setting the price can be intended to apply psychological manipulation to the buyer, which often works.)

If you are complaining about the prices of anything, your complaint is not with the seller, it is with other buyers who have proven they are willing to pay it.

hristov3• 4 years ago

Then buy generic. This is one way to fight inflation. Coke will get the message very quickly if their sales start coming down.

vsareto• 4 years ago

If you drink neither and choose water, then it'll really come down. Bonus: you'll feel better

ragazzina• 4 years ago

If GP comment is right, and the price of Coke has really increased 100%, the sales would have to decrease by half before they were hurt in the profits.

maeln• 4 years ago

I don't drink this kind of beverage, but from what I see in restauration, you don't really have a choice. Most fast-food and restaurant will have the "known" brand and no generic brand, so they will move the cost onto their customer.

eatsyourtacos4• 4 years ago

Coke will get the message

Yes, you the single person going generic will definitely send a message to Coke!

Hey I get your "sending a message" concept. But you also have to be realistic. Coke is almost literally everywhere you could possibly go. A lot of times it's basically the only option aside from a grocery store. It's popularity is so high and it is to be fair a quality product, that you as the individual are never ever going to have anywhere close to a material impact no matter how hard you believe.

Also, most people agree it is objectively the superior product. So while you may save some money, you are also getting a shitter version of something that is already bad for you.

Send a message with your wallet- sure. But don't be so naive that it will actually have an impact for something like Coke. You are honestly just hurting yourself in the taste department to save a negligible amount of money. It's a no-win.

supertrope2• 4 years ago

I understand your point on saving money. Switching to cheaper substitutes is accounted for in chained CPI. e.g. If steak becomes too expensive and more people buy hamburger instead this substitution effect is accounted for in the basket of goods. It's very rare for food items to deflate. It's usually a slow monotonic upward march.

BeetleB3• 4 years ago

As a Pepsi guy, I can assure you: Coke drinkers will never switch to anything else.

kelnos4• 4 years ago

I bet some people are buying generic now, and Coke doesn't care, because they've done the math, and have decided that losing a few customers (perhaps only temporarily) is worth the extra revenue generated by the customers who keep buying Coke at the higher price.

boole1854• 4 years ago

If you check Coke's financial statements, you'll see that although revenue has risen quickly, cost of revenue has risen about as fast, leading to relatively unchanged gross profit margins (36% so far in 2022, compared with 40%+ in every year from 1985-2014 and between 33%-39% from 2015 to 2021). Word from industry press is that the rising price of aluminum has been a major driver of the increased costs.

I don't know why pricing for the generic brands wouldn't increase as much. Perhaps some stores see the large price increase in branded soft drinks as an opportunity to get people to shift to the store brands and are willing to tolerate lower profit margins to see if that strategy pays off.

danuker3• 4 years ago

Store brands have very little advertising costs, for one.

Coke spent $4B on advertising in 2021 [0], which is about a quarter of their costs. [1]

[0] https://statstic.com/coca-cola-advertising-costs/

[1] https://www.macrotrends.net/stocks/charts/KO/cocacola/cost-g...

hhjinks• 4 years ago

Generic brands often don't come in aluminum cans, assuming the industry rumours are true.

iamgopal• 4 years ago

Increase diameter couple of mm and reduce height couple of mm, will that work ?

alistairSH2• 4 years ago

Of course they are. There was a much-watched video that went around a few weeks ago that composed quite a few CEOs talking about pushing the pricing envelope to take advantage of inflation news (effectively saying: "People now expect price increases, we can leverage that to our gain!").

https://www.youtube.com/watch?v=psYyiu9j1VI

dmix2• 4 years ago

There's not really much we can do about this. Artificial price ceilings were tried in Venezuela and it only contributed significantly to their massive food shortages they experienced.

Most notably it resulted in a big reduction in the variety of food available because while some of the biggest companies could survive with the new lower prices (and work with the gov directly to set those prices) the bulk of small/medium sized ones couldn't, often as other expenses eventually increased while prices didn't.

dntrkv3• 4 years ago

That's literally how the market is supposed to work and it's not a bad thing. This is not some conspiracy. Companies price test all the time. They will increase the prices until either the consumer won't purchase their product or a competitor comes in and undercuts them. Sometimes the market conditions favor the consumer, sometimes they favor the company.

BeetleB3• 4 years ago

I think the restaurant industry is going crazy with this. Yesterday I stopped at a food cart. The price of a gyro sandwich was $13. It didn't come with fries. I asked how much for a side of fries. $6. Throw in a drink and add another $2. So a sandwich, fries and drink "combo" is over $20.

And this is from a food cart, mind you - not a restaurant. And not a fancy food cart that people drive miles to try their unique food. Just a few years ago that sandwich would have been $8-9.

cl0ckt0wer• 4 years ago

"Food at home" is up 12% year over year. Table A in the link is good reading.

staticman2• 4 years ago

I'm surprised to hear house brand cola still exists. My local Giant supermarket no longer ever has any in stock.

trashface• 4 years ago

I'm pretty low income ATM and I simply don't buy Coke zero or anything like that much anymore. I drink water, or tea. Loose tea is still pretty economical, even considering water and heating costs.

javchz2• 4 years ago

Yeah, coke can get expensive. I recommend you try cold brew tea, it's almost as refreshing as soda in hot days. You only leave water with tea in the refrigerator at night and enjoy it the next day.

JKCalhoun2• 4 years ago

Is Pop Shoppe still a thing? http://old52blog.blogspot.com/2011/03/pop-shoppe.html

And bring back the "White Label" groceries from the 80's while you're at it. http://historysdumpster.blogspot.com/2012/08/generic-product...

gre• 4 years ago

What is inflation if not the capitalists raising prices?

prepend6• 4 years ago

I’ve noticed this with many items. Nabisco Premium Saltine Crackers are $4.5 and Publix store brand are $1.5.

I’m not sure how much they’ve increased as I don’t remember the old price of crackers but I remember them being really cheap.

It seems odd that the inputs vary substantially between the two so is it just that Nabisco has very different labor costs? Or are they just jacking up the price because they can?

I suspect store brand have a very fixed cost-plus style of pricing where they just sell for a fixed markup over whatever their costs are and don’t really do market research for price points.

claudiulodro• 4 years ago

The biggest crock is the increase in price of sparkling waters. Literally just carbonated water with a squirt of flavor, somehow more expensive than soda nowadays.

massysett3• 4 years ago

This doesn't surprise me much. Most of the cost of these things is the cost of packaging and trucking them around - the cost of the sugar syrup in Coke isn't adding much cost versus the sparkling water. The soda maker might have a more efficient distribution network that allows a lower cost per unit. That, and the customer who's buying sparkling water (instead of buying soda, or just plain bottled tap water) probably is willing to pay more.

reducesuffering• 4 years ago

That's probably because the people drinking La Croix aren't too price-sensitive. However, if you actually care about buying them with little margin, Costco has em for $0.30/can and Trader Joe's for $0.40.

bombcar• 4 years ago

Prices around here have stayed the same or gone up a bit, but the sales have dried up. You could almost always get Coke on sale at the grocery store for half the "list price" now that's much rarer.

Zigurd2• 4 years ago

Several commenters have provided various reasons year-over-year numbers are, to put it mildly, difficult to interpret.

Another reason is that a major war in Europe started within this year, adding to the difficulty of Y0Y comparisons. The principal weapon deployed against the aggressor is economic warfare to collapse Russia's economy. That has only recently made an impact that can't be denied in Russia.

Meanwhile, the war has directly cut food exports from Ukraine and both directly and indirectly disrupted food and fossil fuel markets in many regions, mostly toward higher costs and trade substitutions that also mostly lead to higher costs.

Interest rate rises are probably needed but the causes of inflation are mostly outside central bankers' control.

flavius296632• 4 years ago

You can't blame US inflation on the Russia war, this is a DNC misdirection. For the US at least, it should be a minor factor.

The US were trading very little with Russia to begin with, even before the war. Russia's economy before the war was still smaller than California, New York or Texas. Waging economic warfare on a medium economy like that should not wreak the US, Europe or the World economies.

richiebful12• 4 years ago

Agreed with one caveat: energy. Some countries in Europe depend on Russian gas for a significant percentage of their energy. Europe is desperate for LNG and is outbidding other gas importing nations, driving up prices.

dalyons• 4 years ago

Energy and food prices are global, regardless of who trades with who. Try to be less nakedly partisan.

Zigurd2• 4 years ago

Commodities are fungible. The US makes lots of oil and food. The companies that make these things sell them to all comers at global prices.

francisofascii• 4 years ago

Anyone know of a publicly available data of grocery prices for staple products month over month? I really wish I would have saved my grocery receipts over the past five years. Rather than rely on my perceptions.

nonameiguess• 4 years ago

If you buy from Whole Foods and have Amazon Prime, your receipts are in your order history forever. It's actually been informative, because amidst all of the breathlessness from the past two years, every time I have bothered to check, most of the prices I'm paying haven't gone up at all or have gone up a tiny bit. I buy almost all raw ingredients and cook from scratch, which maybe just works differently than processed goods sold by Coca Cola and what not, or Whole Foods was just so overpriced to begin with that they didn't bother raising.

My grocery bills overall have definitely gone up, but that's because I stopped eating out and buy a lot more groceries.

shrimp_emoji• 4 years ago

My grocery bills overall have definitely gone up, but that's because I stopped eating out and buy a lot more groceries.

Wouldn't this make your bills go down?

willhinsa• 4 years ago

lol

passwordoops• 4 years ago

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

whimsicalism10• 4 years ago

My guess is that many of the actors in the market have their own error bounds.

ChicagoBoy11• 4 years ago

I'm always reminded of economists wonderful sense of humor whenever I start seeing decimal points on some of these forecasts!

yCombLinks• 4 years ago

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.

techlover14159• 4 years ago

Is the pricing data for inflation swaps publicly available?

wkrsz• 4 years ago

Why is this causing USD/EUR exchange rate to fall? And in general USD to lose value compared to other currencies.

My guess is that expectation of higher inflation was combined with expectation of further interest rate increases to combat it. Interest rate increases generally make currency more attractive for investments from abroad, which increases exchange rate.

This expectation was "priced in" current exchanged rates and now the market has corrected.

benjaminwootton• 4 years ago

That’s exactly why. It means US interest rates will perhaps not peak as high.

sz4kerto• 4 years ago

You're correct, that's why.

noasaservice• 4 years ago

It's not "Inflation". It's straight up wage theft by the rich. They're jacking up prices and blaming (hand-wave) Inflation to extract more profit. And no, workers wages being bumped up to $15/hr is no excuse. Look no further than the profits.

------------------

"Workers around the world: lost $3.7 trillion in the pandemic Billionaires around the world: gained $3.9 trillion in the pandemic

It's the biggest one-year wealth transfer in history, yet somehow barely anyone is talking about it."

https://twitter.com/danpriceseattle/status/13751892041251143...

------------------

Iron Mountain CEO says he's been 'praying for inflation' because it means he can raise prices

https://www.businessinsider.com/ceo-praying-for-inflation-ra...

------------------

Leading grocery chains such as Kroger (KR) and Alberstons have said in recent days that they expect to benefit from rising prices. Sales boomed at these chains and other grocers during the early stages of the pandemic, but have slowed down in recent months as more people return to eating meals out.

“Our business operates the best when inflation is about 3% to 4%,” Kroger CEO Rodney McMullen said on an earnings call with analysts Thursday. “A little bit of inflation is always good in our business.”

https://www.cnn.com/2021/06/18/business/grocery-store-inflat...

jdlyga• 4 years ago

"the rate of increase of inflation is decreasing"

javanissen• 4 years ago

Not sure if this is quoting that economist from the 70s, but in this case it’s inflation that’s decreasing. We’re still just talking about the second derivative of prices, not the third!

hnthrowaway0315• 4 years ago

The whole "expected" thing is sketchy for me. I probably know nothing but why is 7.9% expected, not say 7.5% expected? I think a lot of manipulation of those expectations can be done for "friends in IB".

curiousllama• 4 years ago

Expected is just a survey of those “friends in IB” - it’s just a benchmark for the media to explain if things are surprising.

Anyone making impactful decisions based on expectations should not be making impactful decisions.

ionwake• 4 years ago

In many European countries inflation is at 15%

If it reaches 20% that means every 3.5 years your cash reserve loses half its value

Mean someone correct me if I’m wrong I think that is astounding

hankchinaski• 4 years ago

assuming that the inflation rate remains the same for the next 3.5 years. Which seems unlikely

kshacker• 4 years ago

It appears to be more like tectonic plates shifting. Sometimes they shift a bit, a few aftershocks and pretty much back to normal order. But sometimes it kills a few hundred thousand, changes the landscape that even after the aftershocks subside, it leaves behind quite a different world. 20% loss against dollar for 2 years without reversion will end up creating quite a different world.

aeternum• 4 years ago

I think people are underestimating how much the cost of energy impacts inflation.

It used to be primarily labor costs, and labor/wages is still a major part. However with automation some labor is being replaced by automation and thus converts what used to be labor cost to energy cost.

European countries are not in great shape from an energy POV.

onlyrealcuzzo2• 4 years ago

And yet solar radiation falling on just 1% of Spain, Italy, & Greece - even in the Winter - can power >50% of Europe (and >100% in the Summer).

Europe already gets ~12% of its energy from Nuclear, ~5% from hydro.

Solar energy will not be a problem in the future - neither will sourcing the remaining 33% of energy from other renewables, nuclear, and fossil fuels.

dntrkv3• 4 years ago

As the other poster pointed out, that's primarily due to the energy costs and those will most likely come down. For a more accurate look at inflation, you should look at core CPI which excludes energy and food which can be volatile. This number is closer to around 5% in most of Europe.

fleddr4• 4 years ago

Ah yes, inflation is just fine if you exclude housing, energy and food, the 3 things sustaining everybody's life.

mooneater• 4 years ago

Does anyone actually think this number is accurate to a decimal place?

sidewndr46• 4 years ago

Who set the expectation of 7.9%? I've never expected my money to lose value every month.

sillysaurusx• 4 years ago

The fed.

meragrin_2• 4 years ago

So how much of this is due to lower than normal heating costs last month?

Utility (piped) gas service -4.6%

I used the A/C more than heat last month since temps have been quite a bit higher than normal. Just using A/C in October is pretty abnormal for me.

nightski2• 4 years ago

Looking at the macro picture is so misleading. The only categories that are really down are natural gas, used cars & trucks, and apparel. Everything else is up but it is being masked by the huge drop in natural gas prices (which is due to the situation in Europe).

advisedwang• 4 years ago

Weird that gas prices dropped, I would have thought they'd be up. Any insight?

nightski2• 4 years ago

From what I understand there was a lot of fear due to the conflict this summer. So Europe bought a ton of overseas liquefied natural gas and stocked up as much as possible. So much so there are tankers sitting in the ocean being used as temporary storage.

However currently temperatures are moderate and demand is pretty low. There's optimism for a mild winter and users have done a good job of reducing demand.

So at the moment there's a situation where Europe has too much gas in anticipation of future bad things which is driving a slump in prices.

This will probably change.

slaymaker1907• 4 years ago

MoM inflation is still unfortunately 0.4% which is about 5% annualized. I think it's unfortunate that reporting focuses around yearly inflation which isn't really useful for talking about inflation in the moment.

roflyear7• 4 years ago

5% is not that much higher than historic averages. 1990 had 5.4% inflation, and 2008 close to 4%.

ethagknight• 4 years ago

Worse than 2008, got it.

rufus_foreman• 4 years ago

5.4% in 1990 was the highest rate in an almost 40 year stretch. In 1991 it went down to 4.2% and then wasn't above 4% until last year.

sparrc• 4 years ago

Interesting, that does seem like a more useful metric. Where do you find that data?

tenpies• 4 years ago

It's part of the whole BLS report, here:

https://www.bls.gov/news.release/cpi.nr0.htm

You may also be interested in what is referred to as "sticky CPI" which is reported by the Atlanta Fed: https://www.atlantafed.org/research/inflationproject/stickyp...

The name is fairly descriptive of what it is: the slowest re-acting elements of the CPI calculation. This is contrasted with the "flexible" CPI, which are the elements that react the fastest. In the last report, Sticky CPI was constant (no change), whereas all the decrease in CPI came in the flexible side of things.

rufusroflpunch• 4 years ago

Demand destruction is setting in.

dotnet002• 4 years ago

Reminds me of Nixon's "the rate of increase of inflation is going down" comment and the associated quip that it was "the first time a sitting president used the third derivative to advance his case for reelection."

calgarymicro• 4 years ago

This isn't that. The rate of inflation is going down, not the rate of increase of inflation. 8.2% in September, 7.7% now. The second derivative of prices, not the third.

dotnet002• 4 years ago

I'm aware of that, it just reminded me of that incident and I thought others would find it funny too is all.

qclibre222• 4 years ago

Which is interesting because Nixon pressured official to make "cheap money" : https://www.investopedia.com/articles/economics/09/1970s-gre...

mouzogu• 4 years ago

0.2% less than expected and s&p pumps 5%. f* this timeline.

Kukumber• 4 years ago

At what cost? "allies" as collateral damage, the US seems to be playing the solo game, not sure if that's gonna serve them well when they'll decide to go frontal with China, since their "allies" won't be able to be used as proxy anymore, too weak and no morale

The US announces retreat

paxys• 4 years ago

Seems like these days there are more people who want the economy to fail just to be able to make a point about the political party they support.

I'm personally ecstatic that inflation seems to be softening. It's likely that there will be another couple interest rate hikes regardless, but there does seem to be a "back to normal" in the (distant) horizon somewhere.

colechristensen• 4 years ago

Reporting yearly inflation every month is... confusing at best.

chiefalchemist• 4 years ago

Inflation in and of itself isn't the problem per se. It's income(s) being able to keep pace, or more often than not keep pace.

Working citizens - as well as those on public assistance? - have been losing ground to inflation for decades.

The bottom line: In the eyes of bread winners this is old news, and does nothing (again) to mitigate their discomfort and pain. From a sociopolitical POV this is not sustainable.

So a mere 0,2% delta led to a 6,4% increase in the Nasdaq. I really can't understand...

thrownaway561• 4 years ago

What's sad is that prices will never be where they were ever. I keep getting slammed by family members telling me to "make sure you vote" cause they feel that it's all a single party's fault that we are in this mess and only the other party can fix it, when sadly, it's the world we live in now. Houses will always be insanely priced now and making 100K is like make 50K.

epinephrinios• 4 years ago

https://app.truflation.com/

Worth a look.

mbar84• 4 years ago

Time to purchasing power halving: 9.4 Years

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

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