INFLATION--FED's cutting rates again...
- Thread starter Chop
- Start date
Fed’s Jefferson Rejects Arguments for Raising 2% Inflation Goal
Jefferson sounds like a hawk.
"Federal Reserve Governor Philip Jefferson defended the central bank’s 2% inflation target and said changing it could destabilize “well-anchored” inflation expectations.
Jefferson said a shortage of workers has been one reason why price increases in core services have remained high, as labor costs have risen “at rates above those consistent with 2% inflation.”
While some researchers have called on the Fed to raise the target to give it more scope to cut rates in downturns, Jefferson rejected that idea saying it would “introduce an additional risk” by calling into question the Fed’s commitment to its goals and “lead people to suspect that the target could be changed opportunistically in the future.”
Jefferson sounds like a hawk.
"Federal Reserve Governor Philip Jefferson defended the central bank’s 2% inflation target and said changing it could destabilize “well-anchored” inflation expectations.
Jefferson said a shortage of workers has been one reason why price increases in core services have remained high, as labor costs have risen “at rates above those consistent with 2% inflation.”
While some researchers have called on the Fed to raise the target to give it more scope to cut rates in downturns, Jefferson rejected that idea saying it would “introduce an additional risk” by calling into question the Fed’s commitment to its goals and “lead people to suspect that the target could be changed opportunistically in the future.”
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Yellen says U.S. inflation fight 'not a straight line' after price rise data
Sound like we're not done with rate hikes just yet...
"The strongest U.S. consumer spending data in nearly two years on Friday showed that the Fed's preferred measure of inflation, the personal consumption expenditures price index (PCE), jumped unexpectedly in January, calling into question whether the Fed remains behind in its inflation fight.
"It’s one read, but core inflation still remains at a level that's above what's consistent with the Fed’s objective. So, there's more work to be done," Yellen added."
Sound like we're not done with rate hikes just yet...
"The strongest U.S. consumer spending data in nearly two years on Friday showed that the Fed's preferred measure of inflation, the personal consumption expenditures price index (PCE), jumped unexpectedly in January, calling into question whether the Fed remains behind in its inflation fight.
"It’s one read, but core inflation still remains at a level that's above what's consistent with the Fed’s objective. So, there's more work to be done," Yellen added."
Inflation still has Corporate America concerned: stat of the day
"Inflation has become entrenched inside the brains of many corporate chieftains, despite Federal Reserve Chair Jerome Powell pumping a disinflation view earlier this month.
Among the S&P 500 companies that have reported earnings from Dec. 15 through Feb. 23, 325 have cited the term "inflation" on their earnings calls, according to fresh research from FactSet (see chart below). This number is above the five-year average of earnings call inflation mentions of 201, as well as the 10-year average of 157, FactSet says"
"Inflation has become entrenched inside the brains of many corporate chieftains, despite Federal Reserve Chair Jerome Powell pumping a disinflation view earlier this month.
Among the S&P 500 companies that have reported earnings from Dec. 15 through Feb. 23, 325 have cited the term "inflation" on their earnings calls, according to fresh research from FactSet (see chart below). This number is above the five-year average of earnings call inflation mentions of 201, as well as the 10-year average of 157, FactSet says"
Key US inflation measure surges at fastest rate since June
"The Federal Reserve’s preferred inflation gauge rose last month at its fastest pace since June, an alarming sign that price pressures remain entrenched in the U.S. economy and could lead the Fed to keep raising interest rates well into this year.
...consumer prices rose 0.6% from December to January, up sharply from a 0.2% increase from November to December...
...core inflation rose 0.6% from December, up from a 0.4% rise the previous month. And compared with a year earlier, core inflation was up 4.7% in January, versus a 4.6% year-over-year uptick in December...
January’s price data exceeded forecasters’ expectations, confounding hopes that inflation was steadily decelerating and that the Fed could relent on its campaign of rate hikes. It follows other recent data that also suggested that the economy remains gripped by inflation despite the Fed’s strenuous efforts to tame it."
"The Federal Reserve’s preferred inflation gauge rose last month at its fastest pace since June, an alarming sign that price pressures remain entrenched in the U.S. economy and could lead the Fed to keep raising interest rates well into this year.
...consumer prices rose 0.6% from December to January, up sharply from a 0.2% increase from November to December...
...core inflation rose 0.6% from December, up from a 0.4% rise the previous month. And compared with a year earlier, core inflation was up 4.7% in January, versus a 4.6% year-over-year uptick in December...
January’s price data exceeded forecasters’ expectations, confounding hopes that inflation was steadily decelerating and that the Fed could relent on its campaign of rate hikes. It follows other recent data that also suggested that the economy remains gripped by inflation despite the Fed’s strenuous efforts to tame it."
Big, Painful Grocery Bills Are Here to Stay
"Unless you’re Taylor Swift, you’ve probably noticed the price of eggs has increased dramatically. And, unless you’re Taylor Swift, you’ll be sad to know that your grocery bill won’t go down much this year whatever the headlines say about moderating price pressures. In fact, save a consumer revolt, the inflation of the past two years has created a new, higher price floor.
Companies that supply grocery stores including PepsiCo Inc., Coca-Cola Co., Kellogg Co. and Unilever Plc. initially raised prices to offset increased costs after the war in Ukraine drove up commodities like wheat and energy; and a severe outbreak of avian flu created an egg shortage. Despite widespread complaints, grocery shoppers have broadly been able to handle food inflation, giving companies little reason to peel back prices."
Thanks a lot Jimmy Carter...
"Unless you’re Taylor Swift, you’ve probably noticed the price of eggs has increased dramatically. And, unless you’re Taylor Swift, you’ll be sad to know that your grocery bill won’t go down much this year whatever the headlines say about moderating price pressures. In fact, save a consumer revolt, the inflation of the past two years has created a new, higher price floor.
Companies that supply grocery stores including PepsiCo Inc., Coca-Cola Co., Kellogg Co. and Unilever Plc. initially raised prices to offset increased costs after the war in Ukraine drove up commodities like wheat and energy; and a severe outbreak of avian flu created an egg shortage. Despite widespread complaints, grocery shoppers have broadly been able to handle food inflation, giving companies little reason to peel back prices."
Thanks a lot Jimmy Carter...
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Extra food assistance from U.S. government's SNAP program ends Wednesday
https://www.newsobserver.com/news/politics-government/article272613369.html
With food stamp cuts just days away, millions of Americans brace for tougher times in the grocery aisle
Extra/bonus COVID-period SNAP (food stamps) benefits are coming to an end Wednesday.
From an economic standpoint, this means less aggregate dollars chasing the food at grocery stores and may have some level of effect on food prices, dampering further food price inflation, and possibly leading to some lowering food prices.
From a human standpoint, this may push many struggling (poor) families over the edge. For the sake of the needy, hopefully Congress can pass some kind of extension, meet the old benefit vs the new benefit half-way, or give them more WIC (good for the dairy industry) or something.
https://www.newsobserver.com/news/politics-government/article272613369.html
With food stamp cuts just days away, millions of Americans brace for tougher times in the grocery aisle
Extra/bonus COVID-period SNAP (food stamps) benefits are coming to an end Wednesday.
From an economic standpoint, this means less aggregate dollars chasing the food at grocery stores and may have some level of effect on food prices, dampering further food price inflation, and possibly leading to some lowering food prices.
From a human standpoint, this may push many struggling (poor) families over the edge. For the sake of the needy, hopefully Congress can pass some kind of extension, meet the old benefit vs the new benefit half-way, or give them more WIC (good for the dairy industry) or something.
Maybe take eggs out of WIC since eggs are so blasted high. Then give them more WIC for milk and cheese, etc.
I am painfully reminded of that every time I buy groceries. And the COLA on my Social Security and my USAF retirement didn't solve the problem - it simply compensated me (partially) for last year's inflation. At the current inflation rate, it looks like we'll get another big COLA next year.
"The hurrier we go, the behinder we get."
Janet Yellen is calling for tomorrow (March 2nd) to be a calm and sunny afternoon and early evening throughout North and Northeast Texas, with a 0% chance of rain, and with winds under 5 mph.
AC
2,500+ Posts
By 2025, Real Inflation should be 35% to 45% annually! Only way to solve this problem is print money and raise rates! Told you.
Statalyzer
10,000+ Posts
From what I heard from Powell, he basically gave the dems a blank check to print all the money they can because "government spending does not materially affect inflation". Damn, I would have been thrown out of every economics class I took (even the geographic eco) if I would have uttered such bs.
So let's see:
- a (sort of) hawkish Fed --> higher rates, tightened $ supply
- coupled with much more government spending
- gives us much higher deficits and national debt
- now with higher interest rates on that higher national debt
=
more taxes, or even higher national debt (or both)
- a (sort of) hawkish Fed --> higher rates, tightened $ supply
- coupled with much more government spending
- gives us much higher deficits and national debt
- now with higher interest rates on that higher national debt
=
more taxes, or even higher national debt (or both)
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