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

[Monahorns]

It will be interesting to see what these 2 actions will do when enacted together. Printing more money to stick in accounts and increasing interest rates at the same time is actually an unnatural act. Interest is supposed to be the price of money based on market interactions involving supply of money and demand for money. In general when there is more money available to lend/hand out the rate will be lower. When there is less money to lend/hand out the rate will be higher.

Our leaders are trying to operate the economy outside the realm of economic reality. As far as I know this has NEVER been attempted in the history of mankind. Don't be surprised if something very strange and damaging happens.

Of course that will give the Fed and the government another opportunity to "fix" it.

 

[Chop]

Printing more money to stick in accounts and increasing interest rates at the same time is actually an unnatural act.

Yep. We're deep into bizarro land now.

 

[Chop]

Somewhere in the back of the Fed, there's a monkey throwing darts at a board.

Or there's a former Economics PhD madman, just released from the insane asylum, saying "Why don't we try THIS and see what happens...?"

 

[Chop]

Supermarket shelves from the old Soviet Union?

Nope, it's the fresh vegetable aisle from a typical English grocery store.

 

[Chop]

Cold weather, bad planning to blame for UK salad crisis, Spain says | Cyprus Mail

Prolonged abnormally cold weather is one of the big culprits in the Great British Salad Crisis.

"NO, NO, NO!!!! This can't be!!!!
The world is WARMING not COOLING!!!"

 

[Chop]

So, should the British ration salad, or let the market set prices so high that most people won't buy salad (until it comes down)?

 

[Mr. Deez]

So I went into a Tesco grocery store today. It looked pretty well stocked.

 

[Mr. Deez]

So, should the British ration salad, or let the market set prices so high that most people won't buy salad (until it comes down)?

Who the hell actually likes lettuce anyway?

 

[mb227]

Who the hell actually likes lettuce anyway?

You got a problem with money?

/ducks and exits

 

[Monahorns]

Ultimately with the Fed side with normal people over large politically connected banks? I know who I would bet on.

At least Powell is raising the rate again.

The Fed Backtracks on Future Rate Hikes as Bank Failures Loom Large | Ryan McMaken

 

[mchammer]

Wages for the lowest-earning tier of workers climbed 7.2% in January from a year earlier, averaged over 12 months. That was up from 4% annual growth in January 2021 and exceeded pay gains for the highest-earning workers, according to the Federal Reserve Bank of Atlanta.

 

[AC]

Love how McHammer yammers on about deflation, as BRICS reserve currency takes over for the USD globally. We're gonna make Argentina look tame. When? I don't know, we can kick the can, but we are running out of runway. The USD fate is in the hands of Saudi Arabia, if they go with BRICS and trade in any other currency. US will go full Argentina, and long term Weimar Republic! Got Bitcoin?

 

[AC]

Yep. We're deep into bizarro land now.

McHammer says everything is deflationary and wages are up.

 

[AC]

 

[AC]

 

[Chop]

McHammer says everything is deflationary and wages are up.

I think wages are up, but I’m not seeing the deflationary part.

 

[mchammer]

McHammer says everything is deflationary and wages are up.

Never said deflationary. I said, “by Feb-March timeframe, interest rates will cross over and be higher than inflation”. When that happens you have sound money. I know folks who are buying 5.5% interest bearing CD’s. If you exclude backward-looking rent inflation, inflation is indeed less than 5.5%.

 

[ViperHorn]

Never said deflationary. I said, “by Feb-March timeframe, interest rates will cross over and be higher than inflation”. When that happens you have sound money. I know folks who are buying 5.5% interest bearing CD’s. If you exclude backward-looking rent inflation, inflation is indeed less than 5.5%.

Good theory, but you need to look at the average rent increases in Texas 2021, 2022 and so far in 2023. You will find 10 to 40 % depending on area.

 

[AC]

Never said deflationary. I said, “by Feb-March timeframe, interest rates will cross over and be higher than inflation”. When that happens you have sound money. I know folks who are buying 5.5% interest bearing CD’s. If you exclude backward-looking rent inflation, inflation is indeed less than 5.5%.

McHammer, are you retired? I don't understand your perspective. Our Monetary system is anything BUT sound. Inflation is NOT 5.5%. That is utterly ridiculous. The best way to measure inflation is shadow stats (10%, down from 20% in 2021), which is linked above. CPI is 6.4% but that is NOT accurate. Rent is up big, I think you are referring to Owners Equivalent Rent (OER). If you needed to rent an apt. for yourself it's up big! In Sugar Land, a 700 sq.ft. apt is $1100 to $1900 per month! In 1998, when I was a renter, it was $400 per month. This (OER) is an extremely inaccurate way BLS distorts its CPI calculation. OER is 30% of the CPI calculation. Here is how they get the data:
"The BLS collects the data on rent for about 50,000 residences through personal visits or telephone calls. One sixth of the sample is replaced each year to keep it representative. Since rents do not change frequently, the rent of each unit is sampled every six months." So I have a (paid for) house, if BLS calls me I would have to guess at what the rent would be for my house. All they do is poll people for what they would rent their house out for. Hence, "owners equivalent rent". I've been a homeowner 24 years. I am not a renter, so I don't know much about what my house would rent for. I may or may not do good research on my homes equivalent rent when I answer the BLS survey. It should not be used AT ALL to calculate inflation. That is all your are leaning on is OER. OER is a total scam! It works against you. If you ARE retired, leaning on this, it is to your personal detriment. I've studied all of this a lot. You don't have to agree, but I am just trying to help. Apt rents are up about 11.5% per year since 1998! In Sugar Land.

 

[AC]

I think wages are up, but I’m not seeing the deflationary part.

I think wages are up, but I’m not seeing the deflationary part.

Inflation is 10% and up to probably 15% right now. But the SPR is down -50% since 1/2021. Thus, Gasoline is set to explode into hyperinflation. $10/gallon Gas sometime in the near future. IDK when. That will drive inflation up fast. Plus we have banks failing all over the place. The Federal Reserve Note will crash and cease to be global reserve currency very soon. Weeks. Thus, I am a Bitcoiner. You guys are NOT taking this seriously enough!

 

[mchammer]

Inflation under 5%. Game over. Only question is whether we have a recession.

Fed's Favorite Inflation Signal Slows As Savings Rate Hits 1-Year High | ZeroHedge

 

[mchammer]

McHammer, are you retired? I don't understand your perspective. Our Monetary system is anything BUT sound. Inflation is NOT 5.5%. That is utterly ridiculous. The best way to measure inflation is shadow stats (10%, down from 20% in 2021), which is linked above. CPI is 6.4% but that is NOT accurate. Rent is up big, I think you are referring to Owners Equivalent Rent (OER). If you needed to rent an apt. for yourself it's up big! In Sugar Land, a 700 sq.ft. apt is $1100 to $1900 per month! In 1998, when I was a renter, it was $400 per month. This (OER) is an extremely inaccurate way BLS distorts its CPI calculation. OER is 30% of the CPI calculation. Here is how they get the data:
"The BLS collects the data on rent for about 50,000 residences through personal visits or telephone calls. One sixth of the sample is replaced each year to keep it representative. Since rents do not change frequently, the rent of each unit is sampled every six months." So I have a (paid for) house, if BLS calls me I would have to guess at what the rent would be for my house. All they do is poll people for what they would rent their house out for. Hence, "owners equivalent rent". I've been a homeowner 24 years. I am not a renter, so I don't know much about what my house would rent for. I may or may not do good research on my homes equivalent rent when I answer the BLS survey. It should not be used AT ALL to calculate inflation. That is all your are leaning on is OER. OER is a total scam! It works against you. If you ARE retired, leaning on this, it is to your personal detriment. I've studied all of this a lot. You don't have to agree, but I am just trying to help. Apt rents are up about 11.5% per year since 1998! In Sugar Land.

The price increases in the last 2 years is irrelevant to inflation happening today. Not sure why I have to repeat this 1000 times.

 

[mchammer]

Inflation under 5%. Game over. Only question is whether we have a recession.

Fed's Favorite Inflation Signal Slows As Savings Rate Hits 1-Year High | ZeroHedge

private wages bounced big from 6.7% Y/Y to 7.7%

Wages are exceeding inflation.

 

[Chop]

private wages bounced big from 6.7% Y/Y to 7.7%

Wages are exceeding inflation.

I'm not sure if that's accurate if you factor in housing prices/rents into your inflation measure. Pop economists really fixate on one measure of inflation, which fails to capture a lot of the expenses a typical family will make.

 

[Run Pincher]

So much for inflation being in control. And or course biden doing everything he can to restrict production in the US.
Saudi Arabia, UAE, Kuwait and other OPEC nations to voluntarily cut oil output significantly: Report

 

[nashhorn]

But Biden asked them to increase so that he could decrease isn’t that correct? How dare they? Biden will be angry, that should scare them.

 

[Chop]

So much for inflation being in control. And or course biden doing everything he can to restrict production in the US.
Saudi Arabia, UAE, Kuwait and other OPEC nations to voluntarily cut oil output significantly: Report

Well, at least that will be good for the State of Texas and the E&P side of the business.

 

[mchammer]

Natural gas is back down to $2.08 per MMBTU. Extremely cheap. Natural gas is more important than crude oil to US economy.

 

[AC]

private wages bounced big from 6.7% Y/Y to 7.7%

Wages are exceeding inflation.

100% false!

 

[AC]

Saudi Arabia's Crown Prince is No Longer Interested in "Pleasing" the U.S.