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Consumer prices rose 8.5% in March – highest since 1981

• throwaway5752 5y ago
  Inflation in the west is Russia's goal. There is an economic war going on, for those that are not aware.
  • deleted 5y ago
    [deleted]
• flerovium 5y ago
  Note: it's 8.5% annualized.
• costcofries 5y ago
  Fuel[1] accounted for a substantial portion of the overall lift, we've actually come in under expected inflation which is why you're seeing markets up today. Gasoline, unleaded regular - +48.8% (+20.1% over last month) [1]https://www.bls.gov/news.release/cpi.nr0.htm https://www.bls.gov/news.release/cpi.nr0.htm
  • chasd00 5y ago
    > Gasoline, unleaded regular - +48.8% (+20.1% over last month) i called the bottom on oil during the worst of the pandemic but did nothing about it :( EDIT: i also sold apple at $10/share, i am not good at trading hah
  • taylodl 5y ago
    Yeah but that headline doesn't generate as many clicks! War increases inflation! News at 11:00!
    • typeofhuman 5y ago
      Inflation was steadily rising before Russia invaded Ukraine. Also a US President who is antithetical to the oil/lng industry will drive up the price of oil through the futures market. Demand is still high, Biden has constrained supply, forcing futures prices to go up. Trump was bullish on oil/lng, with the same demand and increased supply, prices went down.
      • ______-_-______ 5y ago
        The biggest perk of being president is the dial under your desk you can turn to raise or lower gas prices
        • typeofhuman 5y ago
          I suggest you read my longer root level comment on this post. It'll help you understand how the actions of a president can affect oil futures.
        • macilacilove 5y ago
          That dial exists and it calls the Saudi king and reminds him that he wants to increase oil production if he prefers himself untoppled.
          • JumpCrisscross 5y ago
            > it calls the Saudi king and reminds him that he wants to increase oil production if he prefers himself untoppled America no longer supports the House of Saud. It tolerates it. But were it to face a serious threat, apart from a Wahhabi fundamentalist, the U.S. would be unlikely to intervene. Riyadh knows this, which is why those calls aren’t very useful. That said, the President does have dials. They are drilling permits and import restrictions.
            • cthalupa 5y ago
              >They are drilling permits and import restrictions. I'll focus just on the first half: Less than 10% of oil drilling happens on Federal land, and there are thousands of unused permits available. Which isn't to say that these thousands of permits could be drilled on tomorrow - they are subject to environmental impact studies, lawsuits from locals for dozens of reasons, supply chain issues around equipment, etc. Which is a long way of saying: This particular dial is very indirect, at best.
  • zaroth 5y ago
    The market is “up” mostly because the USD is down, not because real values are rising. USD value is going to be hit extremely hard as it loses reserve currency status. The days of the petrodollar have come to an end. It will be a typical “closing the barn doors after the horses have bolted” response which will only make things worse. This is actively happening now, the big holders are just trying to do it quietly to get out as much as possible before the US tries to shut it down and USD fully tanks. As this happens the market valuations will appear to rise in nominal values. If you value the market in gallons of unleaded or dozens of eggs however you will see a different story. There’s only so many years the politicians can claim it’s a “supply shock”.
    • JumpCrisscross 5y ago
      > the USD is down The dollar is approaching a 3-year high [1]. It is up close to 9% over the past year. [1] https://www.wsj.com/market-data/quotes/index/DXY/ https://www.wsj.com/market-data/quotes/index/DXY/
      • zaroth 5y ago
        What do you think that chart is showing? How do you square it with a chart of USD value versus an asset which has held consistent value for millennia? https://www.kitco.com/charts/popup/au1825nyb.html https://www.kitco.com/charts/popup/au1825nyb.html
        • JumpCrisscross 5y ago
          > What do you think that chart is showing? The U.S. dollar index, “an index (or measure) of the value of the United States dollar relative to a basket of foreign currencies” [1]. > How do you square it with a chart of USD value versus an asset which has held consistent value for millennia? Gold has appreciated relative to the dollar since its 2016 low. Granted, it took until 2020 for gold to regain its ca. 2013 price. That doesn’t translate into any information about inflation in that interval. Nor about U.S. export/import balances or the dollar’s strength. Unless you’re in the gold business, gold prices are a facile measure of anything economically useful. [1] https://en.m.wikipedia.org/wiki/U.S._Dollar_Index https://en.m.wikipedia.org/wiki/U.S._Dollar_Index
  • antattack 5y ago
    Due to Covid many of us probably drive a lot less (working from home) so gasoline prices are not a big deal. However people in service sector jobs are likely affected by fuel costs.
    • typeofhuman 5y ago
      Everything you consume is delivered by an 18-wheeler that requires heaps of fuel.
      • dragontamer 5y ago
        Actually, trains in most cases. The last mile is trucks, but the backbone of America is our world class rail system.
        • sethherr 5y ago
          Indeed, world class shipping rail system. Our passenger rail is depressingly subpar.
        • throwaway0a5e 5y ago
          >Actually, trains in most cases. The last mile is trucks, More like last 50-100mi. Where's your "local" intermodal yard?
        • hadlock 5y ago
          Do you have any stats on this? As I have read (casually) trucking has been 60-80% of consumer goods delivery (end-to-end), and only in the last 3-5 years has rail started picking up long haul freight, as shipping dry goods like coal has become less lucrative.
      • raisedbyninjas 5y ago
        Not a big component. For example for the retail price of food 4% is for transportation costs. https://www.ers.usda.gov/webdocs/publications/44825/7758_err114_reportsummary.pdf?v=3675.8 https://www.ers.usda.gov/webdocs/publications/44825/7758_err...
  • nightski 5y ago
    Hmm, CPI rose to 8.5% instead of the 8.4% estimate. Not sure where you are getting "under expected" from. Also, inflation isn't necessarily bad for markets. What markets don't like is if the fed has to respond.
    • odonnellryan 5y ago
      They are probably referring to core inflation... also fuel contributed massively to inflation in March, which was expected, but not expected to stay high forever.
      • nightski 5y ago
        Of course, but the highest contributor was shelter/housing. Also if they are referring to core it's kind of important to make that distinction. It's not good to be loose with terminology around this just to make an argument stronger than it really is.
    • bachmeier 5y ago
      The CPI includes energy prices.
    • matwood 5y ago
      YoY which everyone knew was going to be high. Core month to month shows inflation is slowing. I think a lot of people have this doom fantasy of runaway inflation in the US, but it's likely to slow down quicker than people realize. Monetary supply is tightening (mortgage rates touching 5% now), and the supply chain is slowly getting back to normal. Heck, even gas prices have reversed where I am.
      • nightski 5y ago
        I agree it may be slowing, but that's not what the parent asserted. I was just pointing out a mistake in their post. No where did they state "core" (unless it has been edited).
      • 01100011 5y ago
  • tdehnel 5y ago
    Is the implication “it’s not that bad”? I’m sorry but I disagree. Do you have an explanation for why the increased price of gasoline won’t just infect prices for all the goods and services which depend on it? Any business which needs to move people or goods over the road, or runs equipment/vehicles on gas is going to be affected. Not to mention the fact that consumers will have less disposable income to spend on things. And businesses may have to pay their workers more to account for that loss of disposable income. Edit: see “wage price spiral”
    • ceejayoz 5y ago
      > Do you have an explanation for why the increased price of gasoline won’t just infect prices for all the goods and services which depend on it? It will, but the price of oil has already dropped substantially from the recent peak, and probably will continue to do so.
    • dahart 5y ago
      > Do you have an explanation for why the increased price of gasoline won’t just infect prices for all the goods and services which depend on it? The price of gas is known to be volatile, it has gone up in the past without bringing the entire economy along with it, and also has gone down many times without making everything cheaper. The prices of retail goods don’t adjust instantaneously, and gas may well be below what it is now by this time next year. The price of gas might be a small minority fraction of the cost of producing most retail goods as well, so there’s no reason to assume that consumers will tolerate compensatory price hikes that blame gas while the price is falling. This is the reason that the US Department of Labor excludes the price of gas as one of the core indicators of inflation, because the price of gas does not always reflect inflation, and frequently changes for other reasons independent of inflation.
    • iso1210 5y ago
      Today's US gas price is about $4/gal [0], about 15% up on 2011[1], or about 1% per year. That doesn't sound like rampant inflation, it does sound like a market correction. Now in reality gas prices globally is high because of Ukraine and Russia, which hides the massive gas deflation over the last decade, but if 2011 businesses could afford gas at $3.50, I'm not sure why 2022 businesses can't afford it at $4. Wages are up about 30% in the same time period (well by 2020) [2] [0] https://gasprices.aaa.com/ https://gasprices.aaa.com/ [1] https://business.time.com/2011/12/20/2011-is-priciest-year-ever-for-gasoline-3-53-per-gallon-over-4k-spent-per-household/ https://business.time.com/2011/12/20/2011-is-priciest-year-e... [2] https://www.ssa.gov/oact/cola/awidevelop.html https://www.ssa.gov/oact/cola/awidevelop.html
  • bko 5y ago
    Usually if official statistics and what you see are misaligned, its the official statistics that are wrong. What's your general impression regarding price levels in the US? How much has your grocery bill gone up? How about rent? What about restaurant bills? Services like haircuts? Whats your credit card bill look like, excluding gasoline? Personally I have seen prices go up well above 10%. Inflation metrics are complicated and there is a huge incentive to keep the official numbers down as they affect trillions in spending in terms of social security and other numbers tied to official inflation. To put this number in context, Congress gave themselves a 21% increase in House office budgets to account for inflation
    • JumpCrisscross 5y ago
      > Congress gave themselves a 21% increase in House office budgets to account for inflation For staffers. Not members of Congress [1]. Never officially tied to inflation. [1] https://www.factcheck.org/2022/03/spending-bill-includes-pay-raise-for-staffers-not-members-of-congress/ https://www.factcheck.org/2022/03/spending-bill-includes-pay...
      • bko 5y ago
        Right, that's what I said. For office budgets. I didn't say it was for them. I got the numbers from that exact website. It's not "officially tied to inflation" but obviously if you increase budgets its due to higher costs.
        • jlmorton 5y ago
          > but obviously if you increase budgets its due to higher costs That isn't remotely obvious and in this case is very obviously not true. This is a chronically underfunded program that Democrats have been lobbying to increase for years. AOC, for instance, has been pushing for this since she first entered Congress, well before any inflation showed up. It's entirely disingenuous to point to a budget increase in a single extremely-small Congressional staff program and paint it as evidence of broad-based inflation.
• kirbyfan64sos 5y ago
  I think the article's own title is incorrect? > Headline CPI in March rose by 8.5% *from a year ago* Another notable piece: > core inflation appeared to be ebbing, rising 0.3% for the month, less than the 0.5% estimate which matches the other commenter mentioning that the gas prices were a massive contributor to this.
  • throwaway4good 5y ago
    Core inflation is 6.5% yoy which is very high. The other figures are month to month and are noisy and have a seasonal component.
    • throwaway4good 5y ago
      The core inflation tells you that this is more than a fluke in energy prices. I would say it is due to loose monetary and fiscal policies (duh). Maybe we are in for a 70es rerun; and the 70es inflation spiral didn't really end until Paul Volker, Thatcher, and Reagan changed the economic policies. Also stopping the inflation spiral helped bankrupt the Soviets who were a great benifitter of the rising commodity prices ... just a hint.
      • bubbleRefuge 5y ago
        The hypothesis that Volker killed inflation has been discredited. Inflation in the 80's, like today, was supply side from reliance on oil for energy. When natural gas replaced oil for energy production in the US, inflation came down.
        • onlyrealcuzzo 5y ago
          > The hypothesis that Volker killed inflation has been discredited. Highly subjective.
          • bubbleRefuge 5y ago
            It may have even caused more inflation as 20% on treasuries adds lots of interest income to the economy on the demand side.
• TSiege 5y ago
  This is a serious issue mostly fueled by rising energy prices. I wish our politicians could think of better solutions than what's going to be proposed like expanding ethanol use in gasoline, when it will actually make matters worse. See tweet https://mobile.twitter.com/SarahTaber_bww/status/1511329770063151105 https://mobile.twitter.com/SarahTaber_bww/status/15113297700... Any reason Biden can't use the war time production act to force American oil producers to up production (which is still short sighted) instead of making matters worse?
  • typeofhuman 5y ago
    The current administration does not want to relieve the pressure. They are against oil/lng. They openly oppose the industry and want everyone to be driving electric cars and have windmills powering everything.
    • toomuchtodo 5y ago
      Good? I mean, has nothing been learned from the oil crisis in the 70s? If you don't want your economy held hostage, electrify it and use clean energy domestically produced to power it. The US has had ~50 years to plan for this. Make carbon more expensive and rebate that to folks by income (carbon tax). Push people away from fossil fuels, and then you won't be held hostage by fossil producers in the future. Cheap oil isn't a right.
      • typeofhuman 5y ago
        Couldn't the people who own the windmills just as easily hold the country hostage as you put it? Who do you think is paying to build and operate these things?
        • deleted 5y ago
          [deleted]
        • mjhay 5y ago
          Investors? Coal plants could be hypothetically be shut down and hold the economy hostage too. Not sure your point.
• typeofhuman 5y ago
  Limiting the production of oil in any sense is going to increase the price. Biden has said no more drilling on public land and imposed new regulations on pollution. https://www.marketwatch.com/investing/future/crude%20oil%20-%20electronic https://www.marketwatch.com/investing/future/crude%20oil%20-... Here we can see the price of oil futures going back a few years. We can see they start an upward trend once Biden gets into office. and long before the Ukraine conflict. There are two parts of this, what Biden has done, and what people fear he might do. There is a trade off between using goods now, and using them later. The higher the return for using them later, the higher the return for using them now has to be in order to justify consuming it. If Biden says, no more drilling on public land, you are right, that would not impact supply immediately, but it would impact the expected supply and price of oil in the future. Which means that in order for the oil to be consumed now, the price has to be higher. If you add to that the expected regulations to come in the future, further restricting or taxing fossil fuel use, it pushes this even higher. So because it is expected that the price of oil will be more expensive in the future, both because of what Biden has done already, and because of what he has promised to do, then the price of oil has to increase now. Do you understand what I'm trying to convey? FURTHER EXPLANATION Let's say you have 10 barrels of oil to sell. You can sell those barrels now for $100 dollars, or you can sell them in a year for $200 dollars. The more the price of oil in the future increases, so too does your incentive to wait to sell. In response to this, the price of oil has to increase in the present, to compete with the prices promised in the future. So if the future price rises to $250, the present price might increase to $130 in order to incentivize producers to sell now, rather than wait for higher returns in the future. What Biden has done is send signals that in the future, the supply of oil will be lower, and the price higher, which incentivizes producers to wait for those higher returns, which as a result increases the prices now, in order to compete.
  • tootie 5y ago
    Tough to say because Biden is also pushing policy to curb demand and EVs are rising rapidly. I'm not sure if markets have fully absorbed the world of falling supply and falling demand. Or if they actually believe demand will fall appreciably in the near future.
• tomatowurst 5y ago
  and right at the top of CNBC we see BREAKING Stocks rebound on hope inflation is peaking, Nasdaq adds 1% On top of the defaults with China now looking like it won't be able to avoid Russia's fait down the line, with no end in inflation (prices keep going up across the board), with Shenzen and Shanghai in indefinite lockdown impacting supply chains, with BRICS + OPEC signaling they want alternative to USD + crypto/stablecoins impacting financial markets. We are headed for unprecedented market deflation.
  • eunos 5y ago
    Shenzhen lockdown already ended.
    • laluser 5y ago
      Not ended. They were eased. https://apnews.com/article/covid-technology-business-health-beijing-27cd81c6eccf6ceb5c5d26e0e00dadc3 https://apnews.com/article/covid-technology-business-health-...
  • ShivShankaran 5y ago
    That's because most of retail and individual investors had puts or shorted the market. The institutional traders are not going to give up their profits so easily and stock always moves to crush the retailers
    • bequanna 5y ago
      > most of retail and individual investors had puts or shorted the market Most retail investors absolutely do not own puts nor are they net short the market. The actual situation over the past few months seems to be the exact opposite of what you mention. It would seem that institutional investors have been using their retail facing market commentators to urge the public to "buy the dip" while the institutional smart money is selling every uptick: - https://www.zerohedge.com/markets/jpmorgans-resident-permabull-marko-kolanovic-says-take-profits https://www.zerohedge.com/markets/jpmorgans-resident-permabu... - https://www.zerohedge.com/markets/pain-trade-remains-higher-hedge-funds-sell-every-rally https://www.zerohedge.com/markets/pain-trade-remains-higher-...
• mrfusion 5y ago
  A local restaurant just got rid of their paper menus because it was too expensive to reprint every time they wanted to raise prices …
  • enraged_camel 5y ago
    Yeah, I haven't seen a paper menu in months. Everyone does QR code menus now. I hate them.
    • unglaublich 5y ago
      No sane person WANTS to look at a display when they try to relax in a restaurant or cafe.
      • maerF0x0 5y ago
        until you're willing to pay a higher price for the experience anything YOU want will be stripped away.
      • eswat 5y ago
        I remember a sushi restaurant near my had purchased stacks of tablets, hoping them + digital menu would replace their paper menus. This was long before the pandemic. I’m not sure of the specific reason, but they ditched those tablets a few months later.
    • sdfasfdasdfasdf 5y ago
      I have been to restaurants where you see the menu using a QR code and also place an order and pay over the website. I do not like this because, first it seems like its more self serve and there's no service really except bringing the food from the kitchen and I am still expected to pay the same 10-20% tip and second, I am afraid we are perhaps headed towards restaurant analytics, impressions/views for menu items etc, and perhaps the online retailer behavior of not being able to pay without adding a card on file and all the dark UX patterns that come with it.
      • 5y ago
• deleted 5y ago
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• 323 5y ago
  Quite a lot of people are starting to say that measuring inflation with a single number is like measuring the temperature of the whole US with a single number - "today the temperature in US is 81 F".
  • davidjgraph 5y ago
    And that's wrong because the units are outdated?...
    • wincy 5y ago
      It’s wrong because there’s a freak snowstorm in Seattle and it’s 39°F there right now and it’s 81°F in Kansas City. So the average temp between those two place is 60°F which tells us nothing useful about either place.
      • francisofascii 5y ago
        Sure, but prices are up everywhere for most goods. Are prices actually down for anything significant right now? So using the weather analogy, it is hot everywhere in the US.
      • sudosysgen 5y ago
        If half of the US was under a freak snowstorm that would be pretty significant.
      • kzrdude 5y ago
        Over longer time the US average temp is useful, it tells us something about the climate, not the weather. Maybe that analogy kinda works for the economy.
  • z2 5y ago
    Which is potentially useful if the aggregate is weighted appropriately and whatever insights respect the implications of using an aggregate. It's even more useful with the additional information that temperatures in the US tend to be highly correlated between areas. Some useful insights if you have enough data points would be where in the year you are, which season it is, if it might be an El Nino or la Nina year, and over the long term if there are any secular trends like global warming...
• refurb 5y ago
  If anyone wants to listen to a prescient conversation about the feds actions post-2008 and inflation today, take a listen to this podcast. It was recorded in 2009. https://www.econtalk.org/meltzer-on-inflation/ https://www.econtalk.org/meltzer-on-inflation/ It’s an interview with Prof Meltzer from Carnegie Mellon who has done extensive research on the federal reserve system. Cliff notes: - As a result of the 2008 crisis the fed expanded the money supply to a degree never seen before - Rather than drive inflation, the “new money’s” effect was muted due to skittish banks who would decide to just take the funds and hold as cash/treasuries (maintaining strong reserves) until more positive economic indicators emerged (this process could be paused if economic sentiment turned negative) - Once economic forecasts turn more optimistic, the money will be deployed (through lending) into investments and assets leading to inflation in those prices - Eventually the excess supply will spill over into consumer spending in the classic indicators of inflation like CPI - However the fed will be under immense political pressure to not drive the “fragile” economy into a recession so any tightening will be far too late and inflation will overshoot targets by a large degree. - Similar to the 70’s, until strong monetary contraction is brought in, inflation will run very hot despite other efforts to control it Pretty accurate so far.
• calvinmorrison 5y ago
  And yet people on hacker news or other high income forums seems to say "Just buy a EV". It's the "Let them Eat Cake" of 2022. Poor people driving economy boxes and living in a 4th floor walkup apartment with 3 roommates aren't buying an EV... even if the savings are better long term. It's the "Buy a better pair of boots they'll last longer". And yet - people seem oblivious - like Marie Antoinette that the poor class can't simply upgrade to solar and use an EV and avoid the gas prices which hit their bottom line pay every week in the form of higher prices and higher costs to travel. Who cares about bread when it costs so much to drive to the gas station? Let them get an EV
  • memish 5y ago
    Here are some other helpful tips. mustache twirl Try forgoing expensive medical bills. Try not eating. You only need some organs. https://www.youtube.com/watch?v=9ssNtIvD5sc https://www.youtube.com/watch?v=9ssNtIvD5sc
  • ajross 5y ago
    > Poor people driving economy boxes and living in a 4th floor walkup apartment with 3 roommates People living in 4+ story apartment buildings have extensive options for transit that don't involve driving their personal "economy box" around. And to the extent they do, the "poor class" in the USA continues to pay lower prices for gas than any other industrial democracy, including in places like Australia and Canada with comparable per-capita driving statistics. That argument seems like a canard. Yes, higher gas prices suck. They suck rather less than land wars in Europe though, so... what's the option here? I know there's a partisan angle there that says something about fracking, but needless to say short term inflation isn't well treated by half decade infrastructure projects. Gas is going up because Russia invaded Ukraine, and there's nothing anyone in the west can do about that right now regardless of whether they drive an EV or not. (Won't lie though, that I'm totally loving the Tesla right now.)
    • gtk40 5y ago
      I lived in an apartment in suburban Atlanta that was 4 stories in a county with no public transit whatsoever. Plenty of places in the U.S. have little or no public transit in the US but also have the density to support apartment buildings.
• TradingPlaces 5y ago
  Chart with components. The big news for me is that durables, which were leading inflation for a year, are now a net drag in the month-over-month https://twitter.com/lookinggdlouis/status/1513882542990147595?s=21 https://twitter.com/lookinggdlouis/status/151388254299014759...
• jmyeet 5y ago
  Here are the weightings of CPI [1]. It's not quite that simple (eg there are seasonal adjustments) but it's a good rough estimate. You'll note that Shelter (Housing) is 32% and Energy is 7%. Two key events YoY: 1. We went from Covid discounts in housing to a corection and a surge in the other direction. Housing is certainly a problem but the impact on inflation is slightly exaggerated because of that swing; and 2. A war started in Ukraine and this allowed energy companies to arbitrarily raise prices for massive profits that have little to do with actual or potential supply issues. Housing takes a long time to turn around. I honestly think we need to start punitively taxing property held by corporations (including LLCs), foreign-owned property and illegal hotels (ie AirBnB) as these are restricting access to a necessity for no real benefit. As for energy, as much as many in the US in particular like to blame this on Biden. It's worldwide. The real problem though is profiteering by oil companies. It maddens me when I see governments suspending taxes to reduce the hit but somehow the energy companies can't take a hit? They're making absolute record profits. But no one even speaks about that. Where Biden is responsible is in the same way every US president is, regardless of party. And that is in promoting a reckless foreign policy and dangling NATO membership to Ukraine to keep it aligned with the West when it was (and is) never going to happen for exactly the reasons we're seeing now. Of course, Russia is to blame for a completely unjustifable and horrific invasion and everything that comes from that but both of these things can be true at the same time. Put it this way: you park your car in a crappy part of town and leave your Macbook on the hood and there's a good chance it'll be stolen. Sure the thief is responsible but you also could've taken more care. And no, that's not victim-blaming. [1]: https://www.pewresearch.org/fact-tank/2022/01/24/as-inflation-soars-a-look-at-whats-inside-the-consumer-price-index/ https://www.pewresearch.org/fact-tank/2022/01/24/as-inflatio...
  • Workaccount2 5y ago
    Taxing those land/dwelling holding corporations just creates a pass-through situation where the end-user ends up footing the cost of those taxes. It ultimately just raises prices even more. The best fix (and proper one) is for states/feds to step in, override zoning, and start mass construction of new multi-family housing.
    • 5y ago
• BitwiseFool 5y ago
  >"Consumer prices rose 8.5% in March, slightly hotter than expected and the highest since 1981" The qualifier "slightly hotter than expected" reeks of media manipulation. 'Spin' at best, 'propaganda' at worst. It seems obvious to me that the reporters are trying to dampen or downplay this obviously negative news. Whereas this exact same news could be harped on and used like a weapon against the policy of the current administration. But don't worry, this was "expected" and only slightly worse than our central planners predicted. Keep calm and carry on.
  • nonameiguess 5y ago
    This is a weird comment. "Expected" doesn't mean it's good. It was expected because March already happened and forecasters had a pretty good idea of what the retrospective measure would be based on their own measurements.
  • zzleeper 5y ago
    Nonsense. 8.5% is literally slightly hotter than the expected 8.4%. From yesterday's Axios: > Details: Analysts surveyed by FactSet expect the release to show 8.4% inflation over the last year. That would be the highest inflation rate since December 1981. The rate was 7.9% for the year that ended in February. From this morning (6am) Morning Brew: > Good morning. Today’s consumer price index reading is expected to show that March prices surged 8.4% over last year. You know who’s not contributing to inflation? The Brew. Today, we’re launching a revamped referral program with cheaper “prices” on swag items…that were already free to begin with. So the NEWS of the release is that it was 8.5% instead of 8.4%. That's why they pointed it out. Everything else was already priced in by markets.
• zzleeper 5y ago
  Open question: won't inflation lead to mechanically higher stock prices, specially if it's demand driven? Say we give duplicate the amount of money in the economy(M1 M2 etc) and prices immediately double. Won't that also double firm revenue, profits, dividends, and thus firm value in nominal terms? Thus, if stock prices and home prices are +10% in nominal terms, with inflation close to 10%, doesn't this mean they are just breaking even?
  • staticman2 5y ago
    That's not how stock prices worked in the 1970s, so no. A lot of the stock price is essentially driven by social psychology, not earnings.
  • sidewndr46 5y ago
    > won't inflation lead to mechanically higher stock prices I'm reasonably certain that is the point of inflation, since everyone seems to measure economic health based off the stock market.
  • mattnewton 5y ago
    Prices don't immediately double. My layman's understanding is that it heavily depends on where you put the new doubled money in the economy, and it's resulting velocity. If you give it to banks they might park it in assets, increasing their prices, but then the money "stops" moving through the economy and doesn't have a large effect on things like food prices for instance. If you give it to people who need to make rent now, then they probably spend it immediately, often to people who also spend it soon, and it has a higher velocity and broadly affects prices before being absorbed into a slower moving asset like a bond or long term stock holding.
  • datalopers 5y ago
    Stocks gave an 88% aggregate return over 2019-2021. I’d say official inflation numbers are just now catching up.
    • deleted 5y ago
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• photochemsyn 5y ago
  A major reason gasoline, diesel and natural gas prices are spiking is the push to export more fossil fuels from the USA by the oil/gas industry. This was facilitated by the 2015 decision to eliminate the ban on crude oil exports, which Obama/Biden and Republicans backed. It's simple supply and demand: reduce domestic supply by increasing exports to jack up domestic prices and increase profits. Around the same time at least one major domestic refinery was also closed, adding to the domestic supply restriction. There is some effort to get the ban re-instated as of 2021: > "Khanna drafted a letter to the White House Monday signed by nine Democrats urging the administration to block the export of U.S. oil, which has been allowed since 2015 when Congress lifted a 40-year-old ban on the practice. Since then, U.S. exports have regularly surpassed 3 million barrels a day, more than the production of major OPEC members such as Kuwait and Iran." https://financialpost.com/pmn/business-pmn/lawmaker-says-white-house-is-mulling-ban-on-crude-oil-exports https://financialpost.com/pmn/business-pmn/lawmaker-says-whi...
  • WesleyHale 5y ago
    Maybe I'm an idiot, but I don't understand why we'd be exporting oil while also importing millions of barrels from Russia a month. [1] Certainly it's more cost effective to obtain it domestically than to import it from the other side of the world? [1] https://www.eia.gov/dnav/pet/hist/LeafHandler.ashx?n=PET&s=MTTIM_NUS-NRS_1&f=M https://www.eia.gov/dnav/pet/hist/LeafHandler.ashx?n=PET&s=M...
    • citrusybread 5y ago
      different compositions. what we call "oil" actually ranges through so many configurations you might as well think of it the same way we think of juice. sulfur and other impurities can change the game dramatically. it's also the reason Alberta's tar sands have few importers, because not everyone is capable of refining it (which leads to Canada having to export it, and import foreign oil). there are refineries in the US that only work effectively on Russian oil -- and I'm sure there's similar issues elsewhere in the world. they can probably adapt but it's not as uniform as we'd think.
    • photochemsyn 5y ago
• caycep 5y ago
  Honestly, this was just my gut and I've felt prices were artificially low for the past decade or so - maybe because of globalization and offshore manufacturing, and things are really just catching up to what they're actually worth. You can elect a guy that will "decouple" from China and trash international trade deals...but don't expect low prices 4 years later...
  • tmp_anon_22 5y ago
    In the US whenever I traveled during the past decade it felt like consumer goods were much more expensive, CAD, AUD, EUR, purchases all felt more expensive. I wonder if part of this is just the weakening of the dollar as the result of US economic policy over the last twenty years.
  • ericmay 5y ago
    I agree. I think the prices we see now are probably more "correct", and things were just very cheap in the past. But I also think that there's some inflation going on from pent-up savings. Flights, credit card points, hotels, etc. coupled with corporations raising prices to offset losses in 2020-2021. I'm also curious about a race condition with wages and prices. Forget the tech wages because those are probably propping up equity markets and housing markets, but day-to-day stuff where someone was making $15/hour and now they're making $20/hour or more with that change happening over the course of a year and for millions, well, they can afford the higher prices... I'd love to read something more educated on that topic though. I have an intuition (race condition or at least partial race condition) but I haven't studied the specific economics of that. I always assumed you'd get inflation but not corresponding wage increases. I guess if the west is able to prop up currencies, it's fine? Kind of like living in Iceland except everywhere. For example, I live in Ohio. Can someone explain to me why I would expect a swordfish steak or tuna steak or salmon to be cheap whatsoever? And that's still not pricing in offsets needed from c02 emissions. Chicken on the other hand? Yea that should be very cheap and very fresh. We need more local suppliers. Grow a victory garden. Last season we had so many onions. I wish I could have had a neighborhood farmer's market. But rules. Regulations. Etc.
    • 5y ago
• Iwan-Zotow 5y ago
  Putin did it!
• deleted 5y ago
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• timcavel 5y ago
• memish 5y ago
  Predictions on where it goes from here?
  • NDizzle 5y ago
    "One of these days ... One of these days ... Pow! right in the kisser!"
• bryanlarsen 5y ago
  The best cure for inflation is to increase taxes. This removes money from the economy, and can be targeted towards the areas of the economy with too much money. Raising interest rates paid to the Fed are another way of removing money from the economy, but are a broader brush, although the Fed is a much better steward than Congress. Increased interest rates cause stock market declines, so they also tend to act as a wealth tax. Cutting spending is another way, but it's slow acting. It's more of "don't make things worse" than attacking the core problem of "too much money". So if you hear somebody screaming about inflation, ask them if they support increased taxes.
  • deleted 5y ago
    [deleted]
  • AnimalMuppet 5y ago
    So if the money I have is worth less, your response is to take away more of my money? Yeah, that may work to stop inflation. It may have a few other consequences, though...
    • bryanlarsen 5y ago
      All inflation cures are painful. The standard cure is recession and high unemployment. Increasing taxes on the rich is much less painful. Better to take a little bit of your money away than to lose your job. Or you can learn to live with the inflation. Rock and a hard place is the standard expression for the situation we're in.
      • chillacy 5y ago
        I’m curious what the mechanism for reducing inflation is when taxing the rich? Here are my assumptions: 1. Inflation is a function of monetary supply, the velocity of money, and available goods. 2. The rich contribute less to the velocity of money (since they tend to save or drive up asset prices) than the poor
  • carlgreene 5y ago
• drnonsense42 5y ago
  Meat prices are up close to 30% for me in NYC since January. I am aware meat prices don’t dictate inflation numbers but I’m really having a hard time believing any official estimates at this point. The actual Covid numbers over the past ~1.5 months (use imagination) look extremely “smoothed downwards” as well, not that they were ever accurate (although certainly the US was one of few countries willing to or capable of providing public numbers). The underrated thing about Trump was his administration wasn’t capable of hiding their incompetence.
• Tarucho 5y ago
  Who benefits from this? Is wealth distribution changing?
• wonderwonder 5y ago
  Inflation outpacing traditional stock market returns. Even if you do everything right; if you earn an average salary you are doomed.
  • defterGoose 5y ago
    ...and all so Bezos can take a 50's popgun ride and pop bottles.
• euph0ria 5y ago
  Edit: Read counter-arguments in comments to this below. And shadowstats.com puts it to 17.15%: March 2022 CPI-U annual inflation hit a 40-plus year high of 8.54% [up from 7.87% in February], the steepest inflation pace since December 1981; March 2022 ShadowStats “Corrected” Alternate CPI estimate hit 17.15%, up from 16.05% in February], the steepest inflation rate since June 1947 (in 75 years).
  • arcticbull 5y ago
    Shadowstats is completely worthless. They literally just added a fixed 5% to the actual CPI numbers over the entire period without any justification. If you took their average inflation rate to any commodity over the period they claim, the price would be about 10X higher than it is. It's a tinfoil hat conspiracy site.
  • euph0ria 5y ago
    How does Shadowstats calculate it differently: http://www.shadowstats.com/article/no-438-public-comment-on-inflation-measurement http://www.shadowstats.com/article/no-438-public-comment-on-... Counter-arguments: https://en.m.wikipedia.org/wiki/Shadowstats.com#:~:text=A%20number%20of%20economists%20and,easily%20disproven%20and%20absurd%20conclusions https://en.m.wikipedia.org/wiki/Shadowstats.com#:~:text=A%20....
    • deleted 5y ago
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  • gruez 5y ago
    If you deflate nominal GDP with shadowstats numbers, you'll find that GDP has been continually dropping for the last few decades. That seems hard to believe.
  • schemescape 5y ago
    Just eyeballing the ShadowStats chart (because accessing the raw data requires a subscription), they're claiming that the inflation rate has been hovering around 8% since roughly the year 2000. That implies that the cost of living in the US has increased over 5x since 2000.
• FYYFFF 5y ago
  When you print more money in a year than in an entire century, its going to cause inflation. Trump printed 3+ trillion and gave most of it away to the banks and Wall St. That money found its way first into the bond and stock markets, then mid last year into consumer assets. We are never going back. Trump's tariffs and his tax breaks will be with us until your great, great-grandkids are 50... Electing a idiot who lost his entire inheritance, is not smart. Be smarter America.
  • shostack 5y ago
    I'm confused why this administration isn't hammering that point. If you eat the entire bag of Halloween candy in one night, you will face consequences. Cause and effect.
    • mardifoufs 5y ago
      Because everyone can see right through that narrative. Blaming trump for policy decisions that the democrats were extremely supportive of, to the point where they were pushing for much more spending is ridiculous. They scolded the Republicans for not going far enough and the entire negotiations were very public. Not only that but they came up with even more bills and grand spending plans the moment they were elected. Blaming trump for everything just won't work, not when you have control of the house, senate and the presidency. What is even more ironic was that Biden repeatedly attacked trump for deflecting blame, and promised the "adults in the room" won't make excuses. If by the mid terms nothing has changed, the electorate won't be receptive to the mental gymnastics required to connect the situation to Trump. The only thing they will see is that Biden's admin is completely impotent and everything is worse than it was 2 years before. (Even covid numbers are incredibly higher under the Biden admin). So let's hope a miracle happens in the next 6 months because this is has been a slow motion disaster, and no amount of "actually this is perfectly normal but even if it wasnt the presidency cannot be blamed" damage control will magically make things better.
• TYPE_FASTER 5y ago
  After reading the definition of how the gas price factors into the CPI [0], I don't think fuel use is included because it's a price index, not a use index. As average mileage improves[1], and WFH continues, I wonder if usage will either plateau or decline[2][3], resulting in the price of gas having less of an impact. [0] - https://www.bls.gov/cpi/factsheets/motor-fuel.htm https://www.bls.gov/cpi/factsheets/motor-fuel.htm [1] - https://www.epa.gov/system/files/styles/large/private/images/2021-11/2021-f-2.png?itok=nZ1arEcu https://www.epa.gov/system/files/styles/large/private/images..., from https://www.epa.gov/automotive-trends/highlights-automotive-trends-report https://www.epa.gov/automotive-trends/highlights-automotive-... [2] - https://www.eia.gov/dnav/pet/hist/LeafHandler.ashx?n=PET&s=WGFUPUS2&f=W https://www.eia.gov/dnav/pet/hist/LeafHandler.ashx?n=PET&s=W... [3] - https://www.statista.com/statistics/188448/total-us-domestic-demand-for-gasoline-since-1990/ https://www.statista.com/statistics/188448/total-us-domestic...
  • gruez 5y ago
    >I don't think fuel use is included because it's a price index, not a use index. Theoretically this should be adjusted via lowering the basket weight for fuels (if consumption indeed does drop).
• deleted 5y ago
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• thepasswordis 5y ago
  I'd just like to add to this: I find it absolutely reprehensible that The White House is trying to blame this on Russia, even coining a phrase "the putin price hike". Inflation is hurting Americans, and the war in Ukraine is killing Ukrainians. The idea that these people would try to use one of these things to advantage themselves politically instead of addressing the suffering that their policies are causing (and changing course) is reprehensible to me. There is a daily White House press briefing that I suggest everybody watch (you can 2x speed through it). Here is a link to today's: https://www.youtube.com/watch?v=07-AMwJbXQY https://www.youtube.com/watch?v=07-AMwJbXQY Just the way that they talk about this is so...vile. 8.5% inflation is a nightmare. You're in charge. Take ownership of that, and for the love of god stop trying to use the massacre of innocent people in Ukraine is a political tool for youself.
  • Consultant32452 5y ago
  • overtonwhy 5y ago
    Wow a new account that's anti government with the immediate hot take getting voted to the top. How refreshing.
    • thepasswordis 5y ago
      Our accounts are the same age.
  • cavisne 5y ago
    There is 30T in government debt, and interest payments last year were ~500B/~6T of total spending. What impact would a 1% move have on these payments, is this public information? (ie. how much is fixed vs floating etc). Can the Fed even raise rates in an environment like that?
  • arcticbull 5y ago
    So Russia provides a ton of oil. Oil is an input into basically everything you've ever owned. The instability and lack of supply of oil as a result of the war is driving an increase in the price of oil, which is driving an increase in the price of goods. An increase in the price of goods means a decrease in the purchasing power of the dollar. This is how inflation is calculated. Ergo, the Russians launching the war in Ukraine significantly contributes to inflation. Is it solely responsible? Of course not. Does it contribute? Oh most definitely.
• lifeplusplus 5y ago
  CPI was measured differently back then and I read calculating the old way it surpasses 1981
• jbay808 5y ago
  The biggest story here is in shelter prices. https://www.bls.gov/charts/consumer-price-index/consumer-price-index-by-category-line-chart.htm https://www.bls.gov/charts/consumer-price-index/consumer-pri... March saw a continuation of a year-long trend in which YoY shelter inflation accelerated by almost exactly an additional 0.3% each month. March came in at 5%, 0.3% higher than February's 4.7%, and so on. Shelter is the largest category in the CPI basket, and it is critical for a reason. It isn't coming from Ukraine. It mostly isn't coming from supply chain bottlenecks and shipping container shortages. It isn't discretionary. And most importantly, it's a deeply lagging indicator with a long way still to go to catch up to the current activity in the housing and rental markets. My expectation is to see this trend continue. Base year effects (in the second derivative) might slow it down a bit, but by June we could be looking at almost 6% inflation in shelter alone. And remember -- a linearly increasing growth rate is faster than exponential price growth. Interest rate hikes may help, but the dynamics are such that they'll need to make things worse before they make things better.
  • matwood 5y ago
    > It mostly isn't coming from supply chain bottlenecks and shipping container shortages. Inventory is still bumping along record lows. Housing starts were up in the new year, but it will take time for new units to come online after being side lined with labor and material shortages. ~5% mortgage rates are also likely to begin to slow things down.
    • jbay808 5y ago
      > Inventory is still bumping along record lows. Absolutely, but that's part of the mechanism through which price rises happen, more than a causal explanation of it. It further suggests that shelter has a lot of momentum. > Housing starts were... side lined with labor and material shortages. That's a bigger part, but easily offset by historically low population growth in the US. Low pandemic interest rates were almost certainly a much bigger factor in driving the housing market than the cost of construction. > ~5% mortgage rates are also likely to begin to slow things down. Again, absolutely (although if inflation also levels out at 5%, that may be neutral). But, as I mentioned in my comment, there's a "right half-plane zero" in the transfer function between interest rates, housing prices, homeownership costs, and shelter. Rising mortgage rates may level off housing prices, but meanwhile drive up the cost of homeownership. Even as the housing market plateaus, those rising homeownership costs can carry shelter higher, both in the form of real rents and "owner's-equivalent" rents. (In Canada the relationship is more direct, with mortgage interest costs directly included in the shelter basket, but the relationship exists indirectly in the US CPI metric too). That shelter CPI can trend higher as housing prices plateau is the price of reciprocity that we pay for shelter CPI appearing low after interest rate cuts, even as housing prices grew rapidly.
• erdos4d 5y ago
  Does anyone here know how high interest rates need to be to finally see a military spending cut?
• elischleifer 5y ago
  This is what happens when global shipping supply routes break down.
• deleted 5y ago
  [deleted]
• annoyingnoob 5y ago
  No matter which party you choose, or if you choose to be independent, we are very likely to end up with a Democrat or a Republican in the White House. History tells us that a lot of inflation under a Democrat president will help flip the next election to a Republican. If Democrats want the next term they will have to get inflation under control, otherwise the WH is going to flip. The way things are going Biden is going to look like Carter.
• Barrera 5y ago
  > Real worker earnings fell by another 0.8% during the month as the cost of living outpaced otherwise strong pay gains. Most post-WWII recessions were preceded by or coincident with a spike in CPI (and not coincidentally by record-low unemployment numbers). This point is widely overlooked and plain forgotten. A substantial CPI-spike preceded the GFC, for example. Here's a handy chart to look into this further: https://fred.stlouisfed.org/series/CPIAUCSL#0 https://fred.stlouisfed.org/series/CPIAUCSL#0 Way too much attention is being focused on the Fed at this point. The Fed is pretty much a bystander engaged in a psychological operation on the American Public. It talked up the current stock market bubble with its pointless QE and now it's in the process of talking down the bubble as gently as it knows how. Meanwhile markets are telling you what's about to happen. The inversion of the Eurodollar curve in late 2021 and Treasury yield curve more recently are telling you that a recession is on the way. The speed with which interest rates have been fluctuating tells you that something big could be in the works. The sudden appearance of large amounts of housing inventory, partially resulting from spikes in long-term rates tells you that market is peaking. Overvaluation of the stock market by just about any metric (e.g., "the Buffett Indicator") tells you that the bull market is transitory. And of course, there's falling real wages, which the article notes. 0.8% MoM decreases in purchasing power are not sustainable. Consumer spending makes up the majority of the US economy. Give people less to spend and they start going into debt to keep up appearances. Take away their job during a recession, and they default on those debts. Every time these kinds of warnings flash, spinmeisters write them off as peculiarities of the current situation. Every time, there's a reason this time is different. It never is.
  • dont__panic 5y ago
    As someone who's currently feeling left out of the housing market and who thinks the stock market has been pants-on-fire insane for the last 2 years of covid... I pray for a recession so I can actually own a home.
    • Barrera 5y ago
      When the opportunity presents itself few who think that now will want to or even be able to act. It turns out that buying a house when house prices are going down isn't much fun. In fact, it's downright terrifying. Worse, most of the charm of "owning" a house evaporates with even flat prices.
• sequoia 5y ago
  Stepping back from the numbers and into the realm of personal anecdotes: 1. I was listening the radio a couple weeks ago and the DJ invited people to call in and talk about the mask mandate being lifted (in Toronto). Woman calls in, says she went to the grocery store, got three bags of groceries, $146. The dj asks "and... were people wearing masks?" "oh yeah, some were" says the woman before going on to explain how she paid $14.50 for a roll of aluminum foil. The topic was masks and the caller didn't even want to talk about that, the cost of goods was her top and only issue. 2. Standing in a park, an older gentleman is walking by with two small bags of groceries in his hands. I look at him to greet him as he passes, but he walks straight up to me as though he wants to address me. He stops in front of me, looks right in my eyes, lifts his groceries and says "FORTY DOLLARS! Too much money!!" (English was not his first language.) I directed him to the discount grocery, he confirmed that's where he is already shopping, and it's a green grocer with dry goods so I know his bags contained no (costly) meat, just vegetables and maybe some bread, pasta, or eggs. I frequently hear of "inflation" etc. on the news or economic reports, but this is different. I have never been approached by strangers on the street who are so frustrated and shocked by price hikes they couldn't walk all the way home without telling someone, even a stranger. This economic situation is different from any I have experienced in my ~40 years.
  • jcal93 5y ago
    Oooff.. these are hard-hitting stories for me. I can relate similar anecdotal evidence though; my parents called just today to vent about the cost of a carton of eggs at the discount grocer. We've not noticed it too much yet, save the cost of some meats locally. I expect it will catch up here when it's not our growing season.
  • digianarchist 5y ago
    It's almost certain that the BoC will raise rates tomorrow. I think they're going to have to accelerate the increases.
  • Throwawayaerlei 5y ago
    > This economic situation is different from any I have experienced in my ~40 years. I'm sure you realize it at some level, but as someone who's half again older than you, this is the 1970s at warp speed. jcal93's comment below about eggs though is partly "transitory" inflation, we're having another widespread bird flu outbreak like in 2015: https://en.wikipedia.org/wiki/2015_United_States_H5N2_outbreak https://en.wikipedia.org/wiki/2015_United_States_H5N2_outbre...
• parf02 5y ago
  So what does the normal working class guy like me do to protect my savings? Currently investing in diversified ETFs doesn't seem to protect me.
  • reducesuffering 5y ago
    Global stock market is 18 P/E, so returning 5.5% + inflation medium & long term, assuming no growth. That's 14% nominal right now, more if there's any growth (which there usually is medium & long term).
• nofunphil 5y ago
  So, I think it’s time to build solutions that directly address the problem (inflation). An interesting idea would be an NFT (I know…bear with me)that breeds a “child NFT” when CPI(inflation) rises past a threshold. Owner can sell child to cover inflation costs. Child becomes a parent when transferred, and similarity breeds based on CPI increases. Cycle repeats… Would love to hear why it won’t work, how to improve it, etc. Instead of asking governments to stop printing so much dang money, or, starting wars, both of which cause inflation, we can now say fuck it and build economic tools that protect people from the crushing lose in purchasing power. Let’s do that!!
  • erdos4d 5y ago
    Maybe ditch the NFT part and do it with actual children and you might be on to something.
  • fy20 5y ago
    Isn't that just a Ponzi scheme? What happens to the person who buys one, then the CPI is flat for 10 years.
• skybrian 5y ago
  Normally the difference from a year ago is reported, but you might also want to look at the level graph: https://fred.stlouisfed.org/series/CPIAUCSL https://fred.stlouisfed.org/series/CPIAUCSL
• stuckinhell 5y ago
  The government is lying. The CPI index is being manipulated like crazy. Real inflation or grocery store inflation is at 20% percent min, and it's easy enough to check for most americans. Just check your bills and factor in smaller sizes. Cost increase of at least 10% plus smaller portions.
  • erdos4d 5y ago
    100% agree. Prices where I live are up at least 20% from last year on basically everything. The official numbers are just not believable.
• deleted 5y ago
  [deleted]
• randyrand 5y ago
  Can they really not add YoY in the title? It's 3 characters.
• contingencies 5y ago
  In Februrary UK prices were up 6.2% YoY which is a 30 year high. https://www.bbc.com/news/business-60833361 https://www.bbc.com/news/business-60833361
• aglavine 5y ago
  I don't get it. With this unemployment figures deficit could be decreased substantially without hurting much economy. Why on Earth they aren't doing this?