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Going? Evidently you have not visited a lumberyard in 2021...

bruce511 5y ago
It's important to understand that the price of one thing does not inflation make. Yes, lumber has shot up, but that is a function of supply and demand, not inflation. Demand went through the roof, supply was constrained, prices rose, and are now falling, although there is still backlog and so prices remain high. Supply and demand pricing is not inflation, it is the Free Market in action in all of its glory.
- KirillPanov 5y ago
  Of course. But lots of things are going up in price [1]. Lumber makes the best anecdote because it's a tangible commodity that everybody has bought at some point (and many buy semi-regularly), and it can't be blamed on semiconductor shortages. Not even with Deere's silly LTE-enabled feller-bunchers. Also, unlike so many other industries, it makes no sense for forestland owners to take a hit to their profits in order to not "lose customers". Firstly, it's a commodity. But more importantly, they need to use those dollars they earn at the sawmill today to plant, manage, and maintain roads (expensive!) to a crop that won't come to market for another fifty years. This is especially true when they decide (always with trepidation) to accelerate the cycling of a few years' worth of land, as Rayonier has just done during the past month. Accelerating X years of harvest means making a bet that you know what the next X years of inflation look like. The futures markets' liquidity depth is nowhere near sufficient to hedge the amount of harvest acceleration that homebuilders are clamoring for. That's why they are a canary in the coalmine for sudden and non-transient inflation. I'm sure Janet Yellen will downvote this comment. [1] https://nyts.link/https:/www.wsj.com/articles/whirlpool-considering-more-price-increases-if-inflation-exceeds-forecasts-11626987883 https://nyts.link/https:/www.wsj.com/articles/whirlpool-cons...
  - nradov 5y ago
    The increase in lumber prices recently was due to sawmill capacity constraints. Forest land owners didn't have higher profits.
- aunty_helen 5y ago
  You should see this: https://tradingeconomics.com/united-states/inflation-cpi https://tradingeconomics.com/united-states/inflation-cpi The guy that predicted the 2008 housing crash (the guy from the movie) rang alarm bells earlier in the year on twitter that the US is headed for hyper inflation. That was until the SEC paid him a visit and he deleted his twitter. If you want, go on youtube, type 'inflation 2021', adjust your portfolio. August 11 is the date this will all hit the fan as July's numbers will be out.

It's important to understand that the price of one thing does not inflation make. Yes, lumber has shot up, but that is a function of supply and demand, not inflation. Demand went through the roof, supply was constrained, prices rose, and are now falling, although there is still backlog and so prices remain high. Supply and demand pricing is not inflation, it is the Free Market in action in all of its glory.

KirillPanov 5y ago
Of course. But lots of things are going up in price [1]. Lumber makes the best anecdote because it's a tangible commodity that everybody has bought at some point (and many buy semi-regularly), and it can't be blamed on semiconductor shortages. Not even with Deere's silly LTE-enabled feller-bunchers. Also, unlike so many other industries, it makes no sense for forestland owners to take a hit to their profits in order to not "lose customers". Firstly, it's a commodity. But more importantly, they need to use those dollars they earn at the sawmill today to plant, manage, and maintain roads (expensive!) to a crop that won't come to market for another fifty years. This is especially true when they decide (always with trepidation) to accelerate the cycling of a few years' worth of land, as Rayonier has just done during the past month. Accelerating X years of harvest means making a bet that you know what the next X years of inflation look like. The futures markets' liquidity depth is nowhere near sufficient to hedge the amount of harvest acceleration that homebuilders are clamoring for. That's why they are a canary in the coalmine for sudden and non-transient inflation. I'm sure Janet Yellen will downvote this comment. [1] https://nyts.link/https:/www.wsj.com/articles/whirlpool-considering-more-price-increases-if-inflation-exceeds-forecasts-11626987883 https://nyts.link/https:/www.wsj.com/articles/whirlpool-cons...
- nradov 5y ago
  The increase in lumber prices recently was due to sawmill capacity constraints. Forest land owners didn't have higher profits.
aunty_helen 5y ago
You should see this: https://tradingeconomics.com/united-states/inflation-cpi https://tradingeconomics.com/united-states/inflation-cpi The guy that predicted the 2008 housing crash (the guy from the movie) rang alarm bells earlier in the year on twitter that the US is headed for hyper inflation. That was until the SEC paid him a visit and he deleted his twitter. If you want, go on youtube, type 'inflation 2021', adjust your portfolio. August 11 is the date this will all hit the fan as July's numbers will be out.