INFLATION--FED's cutting rates again...

CPI is 6.5%, FFR is 4.5%. Wrong as usual! If the Fed pivots too soon, it will crash the economy and create worse inflation. They call it sticky inflation. Also, BLS moved the goal posts again. January is the first month the new CPI calculation comes out. When they change it it always goes lower. It’s gaslighting. Shadow stats is the only accurate inflation measurement left. Chapwood index was great but it shut down in 2021!


https://www.financialexpress.com/in...to-change-for-january-inflation-data/2944976/
 
mchammer said:
Only on a 12 month basis - it’s backward looking.
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Real inflation is 15% to 20% depending on geography. CPI has changed so much it is not reliable. It ratios back to early 89’s inflation, and ignores housing, rent, food, energy. Those make up 80% of most people’s living expense. A rate like this has to be year over year, it has to be based on actual living expenses. Comparing them to the previous year.
 
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House-flippers, special-purpose acquisition companies and dabblers in crypto and collectibles will no doubt be saddened by the end of easy money. Governments around the world will have to pay more in the years ahead if they are to continue to expand their debt levels. But the rest of us should be heartened by the prospect of an era of sound money and a return to positive real rates. By Vanguard’s calculations, long-term investors globally have seen 10-year return forecasts increase by some 2 percentage points annualized for both equities and fixed income since last year.

That is the power of higher inflation-adjusted interest rates and compounding. Positive real rates make for more balanced trade-offs between all types of investments. With their return, financial markets once again stand on a solid foundation.

Mr. Davis is the Vanguard Group’s global chief economist and global head of the investment strategy group.
 
Wages and salaries for civilian workers increased by 1% in the fourth quarter and by 5.1% for the year ending in December, according to the Bureau of Labor Statistics' quarterly Employment Cost Index released Tuesday.

This reflected a slowdownfrom the third quarter, when wages and salaries increased 1.3% quarter over quarter.

"The debate about wage growth is over: It is coming down," said Nick Bunker, head of economic research at Indeed Hiring Lab. "Wages and salaries are losing momentum as demand for workers cools. The question is now when and how this descent ends."
 
Chop said:
Yep. As most expected. The big Q is: does the Fed pause for a while now, or do another 0.25% raise and then pause?
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Remember at last rate hike, everyone assumes this rate hike would be 0.50% raise. It didn’t happen because of low inflation data. Same thing can happen again, but this time with jobs hurting.
 
Natural gas is $2.50 per mmbtu today amidst a cold wave. This is equivalent of a dozen eggs for $1. If I could I would pay 10 years worth of gas at this price.
 
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Just read up about one possible motivation for Powell's focus on inflation versus "stagnating the economy". If the $ becomes too weak then the petrodollar and eurodollar systems come into question. Saudi Arabia is already open to getting out of the petrodollar with Russia and China. If/when that happens inflations gets even worse as their will be no place for new $s to flow.
 
The elephant in the room is the Dems' position that under their New Monetary Theory one can spend their way out of inflation. (My eco professors all are spinning in their graves with lunacy such as that.)
 
A big problem the anti-dollar foreigners have is: what do you replace it with?

The Yuan??? The Ruble??? Crypto (as it exists today)??? -- and if you think the dollar is unstable!!!

Crypto may (and eventually probably will) develop into something stable enough to replace national currencies. The big Q is: does that happen in a year, a decade, 2 decades, longer?
 
US Manufacturing Surveys Signal Accelerating Stagflation In January | ZeroHedge

I actually agree with McHammer on something! Losing USD reserve currency status is good. Because it could bring in the BRICS reserve currency, using Bitcoin for international settlements. However, watch out for CBDC, which is financial slavery and tyranny. The above Zero Hedge article shows what I have been saying, stagflation is coming to the US. No soft landing. If the Fed pivots, and it looks like they may at some point this year. Look out below, the stock market will absolutely puke!!!
 
Chop said:
A big problem the anti-dollar foreigners have is: what do you replace it with?

The Yuan??? The Ruble??? Crypto (as it exists today)??? -- and if you think the dollar is unstable!!!

Crypto may (and eventually probably will) develop into something stable enough to replace national currencies. The big Q is: does that happen in a year, a decade, 2 decades, longer?
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Sovereign Debt Crisis is real, so is BRICS reserve currency, with Bitcoin for international settlements
 
An under-the-radar economic indicator is flashing a warning signal to the broader economy as consumer spending slows down. The indicator in question? Cardboard boxes.

According to data from the Fibre Box Association, US cardboard box shipments declined 8.4% in the fourth-quarter, representing the largest quarterly decline since the second quarter of 2009, amid the Great Financial Crisis.

Cardboard boxes are an overlooked barometer of the health of the economy as they are a massive component of consumer spending. Whether its ecommerce or shipping bulk goods to stores, cardboard boxes play a role.

The Mainstream Media that continues to lie to Americans every day is at it again. The economy is not nearly as strong as the pundits would like you to believe. But then again this is the gang that told you Obama’s economy was strong, Hillary was good, Trump was a Russian puppet, COVID lockdowns were necessary and the 2020 Election was the most secure in US history. None of which was true.
 
Chop said:
A big problem the anti-dollar foreigners have is: what do you replace it with?

The Yuan??? The Ruble??? Crypto (as it exists today)??? -- and if you think the dollar is unstable!!!
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That is the question Chop. That question will mean that any transition is slow and methodical. However, as the dollar becomes instable and if the US regime continues to make and entrench enemies the transition will occur.
 
Monahorns said:
That is the question Chop. That question will mean that any transition is slow and methodical. However, as the dollar becomes instable and if the US regime continues to make and entrench enemies the transition will occur.
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Similar to the Nixon era situation with the US dollar.
 
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