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Ask HN: Why does the media say inflation is up every month?

• bell-cot 4y ago
  If it bleeds, it leads. You don't get clicks/viewers/readers with "Things are getting better in some complex-but-dull way" sorts of stories.
  • NickC25 4y ago
    Exactly this ^^. Negativity has always sold more than positivity. It's why we "can't help but watch" when we know something bad is about to happen despite our instincts telling us we should look away. In the age of websites needing clickbait headlines to sell advertising, this phenomenon is exacerbated tenfold.
    • ianai 4y ago
      Except this year media sentiment plays into political lies. There’s a major party placing people in all the right places to choose election winners into the future. So the US just might lose its normal political way and indeed freedom because of inflation.
      • xboxnolifes 4y ago
        The media has always played into political lies.
  • graton 4y ago
    Makes me think of a recent LastWeek Tonight with John Oliver episode: https://www.youtube.com/watch?v=kCOnGjvYKI0 https://www.youtube.com/watch?v=kCOnGjvYKI0
  • spaceman_2020 4y ago
    That’s not relevant in a situation where inflation is actually increasing month over month, usually at a far higher rate than expected. This month’s core CPI was expected to be 0.2%. It ended up being 0.4%. Headlines about increasing inflation are not being hysterical; they’re being factual.
• tchalla 4y ago
  Are inflation numbers usually reported the way you suggest?
  • galdosdi 4y ago
    Yes, month over month is the raw source data[1] the BLS reports once a month. The news articles I am referring to are the ones that come out once a month the day or day after the BLS statistics come out. [1] https://www.bls.gov/news.release/cpi.nr0.htm https://www.bls.gov/news.release/cpi.nr0.htm
• outside1234 4y ago
  They also don't announce that it is a global problem and actually Germany has even higher levels of inflation. And the reason for that is that those "everyone is dealing with inflation" stories don't generate clicks.
  • dixie_land 4y ago
    Everyone is suffering does not mean no one is suffering. You probably think North Korea is the best country since everyone (except Kim) is equally starving to death
    • outside1234 4y ago
      Definitely not suggesting nobody is suffering. I am just explaining why they don't put anything in context.
• mjthrowaway1 4y ago
  “Consumer prices in the US were up 0.4% month-over-month in September of 2022, the highest reading in three months, and twice the market expectation of 0.2%. Increases in prices of shelter (0.7%), food (0.4%), and medical care services (1%) were the largest of many contributors to the increase.” Doesn’t seem all that much rosier to have 0.4% MoM with interest rates where they are and GDP declining.
  • the_gastropod 4y ago
    Those are the "raw" CPI numbers. Core CPI excludes food / energy since those tend to be quite volatile. Raw CPI is still quite high. Core CPI, which is generally regarded as a better predictor for long-term trends, is looking pretty good.
    • spaceman_2020 4y ago
      How is core CPI “looking good”? It was 5.9% in July, 6.3% in August, 6.6% in September. That’s the opposite of “looking good”.
      • colinmhayes 4y ago
        You're quoting backward looking numbers, not forward looking ones which is the entire point of this post. If core went up 6% in january and 0 since then you could say the same thing, but no one would think it's a problem.
        • spaceman_2020 4y ago
          I'm not sure I follow. The trend is clearly on the up month-over-month, not down or flat. Is there any other way to infer this? Genuinely curious.
• ponco 4y ago
  As an Australian, with an economy always experiencing very high inflation (8%) I just immediately question what is the composition of the US CPI. Perhaps it’s not reflective or is disproportionately weighted
  • amelius 4y ago
    In some places it has become impossible to buy a house for some income levels. Should the CPI be infinite?
  • richiebful1 4y ago
    That doesn't seem to be the case in the statistics from the Australian Bureau of Statistics. historical data: https://www.abs.gov.au/statistics/research/70-years-inflation-australia https://www.abs.gov.au/statistics/research/70-years-inflatio... more recent history: https://www.abs.gov.au/statistics/economy/price-indexes-and-inflation/consumer-price-index-australia/jun-2022 https://www.abs.gov.au/statistics/economy/price-indexes-and-...
    • coenhyde 4y ago
      Australia has had a lot of asset inflation and is only recently starting to show in the consumer prices. eg afaik house prices are not included in the CPI
• gamechangr 4y ago
  I dont know this to be verified, so perhaps those who are interested could look into this. I have heard the argument that 3 months before every election and/or midterm election ( Nov 8, 2022) inflation is managed to lower numbers. That could be one reason. Usually it's used to improve the annual inflation rate. If that's true then you can comment in Dec and Jan if Inflation rates go up again.
  • buildingsramen 4y ago
    I think that sounds conspiratorial. If there is someone in elected office who has this sort of control, why not do it year-round? Since this is a worldwide trend, how are they able to control it outside their borders?
  • bryanlarsen 4y ago
    - inflation hasn't been an election issue for ~40 years, so that's a lot of risk for little gain - studies of how much countries fudge their numbers have been done, and find that it's only common in authoritarian countries: https://pubdocs.worldbank.org/en/350051528721174623/Nightlights.pdf https://pubdocs.worldbank.org/en/350051528721174623/Nightlig...
• rr808 4y ago
  Do you really think most of the US public really care about details? Prices are going up, things are expensive, people click outrage headlines.
  • outside1234 4y ago
    Well the details ARE important. Almost every country that produces non-biased statistics is seeing inflation. This information is important because it points to a global problem and not a local policy problem.
    • Mikeb85 4y ago
      > This information is important because it points to a global problem and not a local policy problem. It only seems like a global problem because most governments had similar local policies. There are some countries with very low (as in normal) amounts of inflation at the moment.
    • rr808 4y ago
      Yes but the details are here: https://www.bls.gov/news.release/cpi.nr0.htm https://www.bls.gov/news.release/cpi.nr0.htm. Its a boring site with the numbers. The "media" isn't about details, its about entertainment.
  • SoftTalker 4y ago
    I think most people don't care about percentages, this month vs last month or this month vs this month last year, etc. They do care about rising prices on the shelf at the store, or gas at the pump, and these are very noticable regardless of what the media is saying.
• phpisthebest 4y ago
  For the most part people care, index, and budget based on their income. For most people that changes on an Annual Basis so looking at price flucuations from July 2021 to July 2022 is a more accurate and proper way to look at inflation as it impacts the normal every day person, than looking at inflation variance from Aug 2022 to Sept 2022. I care that I was buying beef at $3 / lb last year, and now am paying $6/ lb today, not that I was buying beef at $6/lb last month and it is still $6/lb this month... I want my $3/lb beef back
  • conductr 4y ago
    The MoM reporting for beef price inflation would be ~100% for several months after it hit $6/lb as it's rolling 12 months. That doesn't mean it's $12 in August, then $24 in September, etc. That's the impression laymen folks get based on the media reporting.
    • Y_Y 4y ago
      "laymen" is already a noun like "laity" for which the corresponding adjective is just "lay"
      • conductr 4y ago
        Thanks for the clarification. I've never heard or seen the word "laity" but have become wary of using gendered words on the internet so added "folks" without much thought. Sign of the times I suppose, hard to please everyone.
        • UtopiaPunk 4y ago
          "Lay people" or "lay folks" would work. I only hear the word "laity" used in church (meaning the people who are not the clergy).
  • mech422 4y ago
    Unless I'm mistaken...'most' people are still living pretty much paycheck to paycheck, and budgeting based on what they can afford at the moment. TBH though, I haven't looked lately. Anecdotally, no-one I know complains about beef being $3 last year...they are more concerned with it being $4/lb last MONTH and $6/lb now. Gas seems to be especially prone to this, people seem to budget gas on a more 'weekly' basis.
• nope96 4y ago
  If anyone is curious, here are the numbers: https://data.bls.gov/timeseries/CUUR0000SA0 https://data.bls.gov/timeseries/CUUR0000SA0 Last 4 months have stayed steady-ish at 296
• ozb 4y ago
  Note core inflation (excluding food and energy, which are generally more volatile) has been at least 0.6% (annualized >7%) for 5 of the last 6 months https://www.bls.gov/news.release/cpi.nr0.htm https://www.bls.gov/news.release/cpi.nr0.htm So arguably the narrative is somewhat justified. But also, I wouldn't be surprised if many in the media are just blindly reacting to the 12-month numbers (8% bad!)
  • bryanlarsen 4y ago
    Core inflation is a lagging figure. For most people, rent and wages only change once a year. So if a company decides to raise rent or wages, it might take up to 11 months before it affects you and shows up in the inflation numbers. So high monthly core inflation may mean that core inflation is still rising or it may mean that we're just seeing a lagging indicator from the inflation this spring.
    • ozb 4y ago
      Perhaps, but 0.6% core inflation MoM is still a more updated metric than 8.2% (overall) YoY, which is explicitly ignoring that overall inflation has subsided in the last few months. That is, I agree with the OP if all we have are the non-core numbers, but with the core numbers it's more nuanced.
• beschizza 4y ago
  The annualized rate is the standard measure and in itself isn't a problem until it's being used to conceal newsworthy changes to the underlying economic trend. You've pointed on out one thing (Core CPI month over month) in that respect. More egregious, though, is when media pose the annualized rate AS the month-over-month rate. This happens far too often. The problem is not usually the stories, but the people writing the headlines: innumerate editors who are interested mostly in sensational brevity.
  • outside1234 4y ago
    And when they don't report that nearly every country that produces non-biased statistics is seeing inflation - it a global problem and not a local policy problem.
• RyanShook 4y ago
  The main reason inflation is hard to measure is that it is not uniform and CPI is a poor representation. Even if the basket of goods used for the CPI is level there are many goods not included in CPI that are still increasing in cost. I agree that the CPI number may be optimistic but I think most people and news organizations recognize that CPI is no longer a good measure of inflation.
  • the_gastropod 4y ago
    The FED hasn't measured inflation by CPI since February 2000.
• etchalon 4y ago
  To paraphrase Jon Stewart, because the media's worse bias is towards sensationalism and a bit of laziness.
• kristjansson 4y ago
  That is the traditional number reported for inflation. If a news source says “inflation was x%” I understand that to mean “CPI is x% higher than 12 months ago”. It’s still a terrible way to present the information, for the reasons you point out.
• jjslocum3 4y ago
  This is a timely question, given the front-page headline on this morning's WSJ: "U.S. Core Inflation Hit New Four-Decade High Last Month." Here's an excerpt: "Prices excluding energy and food rose 6.6% The increase marked the biggest annual rise in core prices since August 1982, a sign that persistent increases are becoming entrenched in the economy. The overall CPI rose 8.2% in September, down slightly from the previous month’s gain." I admit I don't know enough to tease out whatever subtleties you're referencing; can you explain what about this is misleading?
  • theptip 4y ago
    I think the complaint is that the “biggest annual rise” part gets lost/diluted; it is in there but much of the messaging sounds like prices just shot up this month instead of this being a YoY observation. I.e. coverage doesn’t emphasize or analyze that it’s a 12-month trailing average. (And, it could even be going down MoM and still give you a YoY increase if lots of increase happened 6mo ago; that might be the opposite valence of news.) WSJ probably being one of the more technical papers so that’s a best-case version there.
  • JumpCrisscross 4y ago
    > can you explain what about this is misleading? Core CPI was 280.02 in September 2021 [1]. It was 296.95 in August and just printed at 298.66. Up 6.6% from a year ago and 6.7% annualised from a month ago. Nothing misleading. Regular CPI, which includes commodities like food and energy, was 274.21 in September 2021 [2]. It was 295.62 in August and just printed at 296.76. Up 8.2% from a year ago but 4.6% annualised from a month ago. The difference becomes clearer examining the graphs. Stylistically, core CPI linearly increases. Actual CPI surged before flattening since June (295.328, less than 2% annualised). [1] https://fred.stlouisfed.org/series/CPILFESL https://fred.stlouisfed.org/series/CPILFESL [2] https://fred.stlouisfed.org/series/CPIAUCSL https://fred.stlouisfed.org/series/CPIAUCSL
• conductr 4y ago
  I was in a ~12 person group conversation this past weekend and most people genuinely thought the continued reporting of the rolling average was ~10% compounding monthly. I hate being a "know it all" type in casual social situations but it was so disconnected from reality that I had to put on my mansplaining hat and give everyone a lesson on how these things work. Unfortunately, the media is to blame for this and their motives are aligned with the misinformation. They do a horrible job with almost all numerical reporting.
  • nathanaldensr 4y ago
    I wouldn't call that "mansplaining;" it's just correcting misperceptions.
    • conductr 4y ago
      Please tell that to the women in my life and see what they claim you're doing :)
• sudden_dystopia 4y ago
  They use 12 months because some of the indicators lag by many months. Some data is only generated quarterly or biannually so looking at a smaller timeline wouldn’t really be helpful. The real issue is that CPI is not a poor metric anyway. It was watered down in the 80’s for political purposes to make them look better(on both sides, not one party or the other). Quite frankly, I don’t trust CPI. In my opinion, the best metric for inflation is your eyes vs the rate of change in prices. If you notice several price increases over a span of several weeks, inflation is a problem.
  • merely-unlikely 4y ago
    Chipotle is my anecdotal barometer. The first burrito I bought a decade ago was ~$7. Last week it was almost $20.
    • itake 4y ago
      How? Chicken burrito with no extras is like $9.50 in Seattle post tax
      • genghisjahn 4y ago
        Well, a decade ago you didn't order the burrito and have it delivered with Uber eats.
    • icedchai 4y ago
      I use a "large pizza", myself (3 toppings, if you wanna get specific.) It used to be ~$20, now it's ~$30.
    • galdosdi 4y ago
      I bought a Chipotle burrito for about $9 or $10 just a couple months ago. I live in a major east coast city. What do you do, ask for every damn topping, triple avocado, etc? BTW, fast food prices have inflated much faster than grocery store food, because labor has inflated more. So the lazier you are about cooking, the more this will impact you. But for those who mostly buy non processed foods and cook them at home, and vary their diet seasonally, using the produce that's currently on sale, it's been a pretty tiny impact over the last couple years in the food category.
• Mikeb85 4y ago
  YoY is the most common measure because many prices and things that happen in the economy are seasonal. Also lots of economic data and prices are only compiled quarterly or yearly so again, YoY makes the most sense. MoM can show trends but isn't particularly useful otherwise.
• breischl 4y ago
  I think you touched on it in your last sentence. It's not actually innumeracy, it's an example of "lying with statistics" to get attention and/or push an agenda (depending on the source). Tangentially, thanks for bringing this up. I've personally been vaguely aware of all the "inflation is high!!!!!!" articles and hadn't dug in enough to see the reality prior to this post.
• ravenstine 4y ago
  All you had to do was visit the very first search result with the domain bls.gov. https://www.bls.gov/cpi/ https://www.bls.gov/cpi/ > In September, the Consumer Price Index for All Urban Consumers increased 0.4 percent, seasonally adjusted, and rose 8.2 percent over the last 12 months, not seasonally adjusted. That's where the figure comes from. "12 months" is the key aspect. Either the media is misreporting its context or people are just not understanding what it means. Pretty much every source I've come across that sites that year-over figure reports it accurately. https://www.pbs.org/newshour/nation/u-s-inflation-at-8-5-percent-slips-from-from-40-year-high https://www.pbs.org/newshour/nation/u-s-inflation-at-8-5-per... > Consumer prices jumped 8.5% in July compared with a year earlier, the government said Wednesday, down from a 9.1% year-over-year jump in June. On a monthly basis, prices were unchanged from June to July, the smallest such rise more than two years. https://www.nytimes.com/article/inflation-us-prices.html https://www.nytimes.com/article/inflation-us-prices.html > The government reported on Friday that consumer prices climbed 8.6 percent over the year through May, the fastest rate of increase in four decades. And no, 8.2% inflation over a year is not a good thing. It's not necessarily the worst thing ever, but that's not a minuscule amount of value to lose from your dollar.
  • kotlin2 4y ago
    I think the OPs point is that the YoY numbers are largely meaningless. I don't think the Fed is trying to cause a period of deflation where we'd go back to the prices we had a year ago. Rather, they're trying to at least get inflation flat so prices stop growing. Where OP is wrong is that MoM inflation is not flat. It's quite high when annualized (~7% the last two months).
    • ravenstine 4y ago
      Their point isn't correct. Neither one is meaningless, and just because a particular month is more inflated than another doesn't even mean that a year overall is inflated. The fact is, if one had let their currency sit in the bank since Jan 2022, at least 8% of the value of that currency is lost. Assuming that a fraction of a percent of inflation in a given month isn't that significant is a human failing of comprehending the long term. People shouldn't just be blowing their earnings every month. They should be at least saving some of it and maybe making some investments, in which case YoY inflation is a big deal. If one has $100,000 sitting in the bank for a year, that's around $80,000 that might as well have been set on fire because that $100,000 has less buying power. My issue with the OP wasn't this exactly, but that they were implying that news outlets are being deceptive when reporting inflation. I'm not one to defend journalism, but these articles make it pretty clear that it's YoY inflation they're referring to.
• kotlin2 4y ago
  Looking at this: https://ycharts.com/indicators/us_core_consumer_price_index_mom https://ycharts.com/indicators/us_core_consumer_price_index_... Core CPI July 0.31% Core CPI August 0.57% Core CPI September 0.58% Or 4%, 7%, 7% annualized respectively. That's definitely higher than the Fed's 2% target.
• jdasdf 4y ago
  Because inflation has very high seasonality, and so it makes very little sense to compare it with a different season. It's not "because it's a bigger number" or to "cause shock", it's simply because its a more consistent and useful way of measuring it.
• former_student1 4y ago
  > Mainstream media has always been a little innumerate but this is a whole other level. Listen dude, it's not the NYTimes's fault your 1 day options expire worthless and your leveraged ETFs went from +X P&L last December to -X P&L today.
• purpleblue 4y ago
  No. The Core CPI should have gone down from the steep interest rate hikes. But they didn't and in fact it's still going up. That's huge. 0.4% MoM increase is 5% inflation annualized and that's just for the core. Other parts of the economy are inflating faster and that's a huge problem. The target is 2%. The Fed needs prices to drop and inflation to abate but it's not.
  • hellojesus 4y ago
    That's because the steep interest rate hikes aren't enough. Real rates are still negative.
• trynumber9 4y ago
  Well it isn't decreasing. And 0.1% and 0.4% are still up. Combined with a GDP recession we have a bleak picture. For people who aren't overcompensated software engineers it is rather annoying combination.
  • spaceman_2020 4y ago
    Its a strange rant. If I had $0 two days ago, $1 yesterday, and $4 today, I would think my networth is going up, not down.
• spaceman_2020 4y ago
  Ummm you just mentioned yourself that core CPI went from 0 to 0.1% to 0.4%. that’s literally the definition of “increasing”
• miked85 4y ago
  I don't believe the numbers regardless of how they are spun. Anecdotally, prices on everything are much higher than +8.9% from a year ago.
  • witoldw 4y ago
    6.6% is excluding food and energy. Energy is up 19.8%, Food is up 11.2%. Horse's mouth: https://www.bls.gov/cpi/ https://www.bls.gov/cpi/
• somenameforme 4y ago
  The reason many economic measurements are based on year over year change (not just inflation) is seasonal trends. Numerous factors change, quite dramatically, on an annual basis. That affects not only the factor changing but many others as well. As but one example, retail business sales skyrocket in November. But that will, in turn, also impact monetary velocity, which will impact inflation, and so on. Seasonal adjustments are possible, but going year over year gives you the most meaningful data.
• cyral 4y ago
  Core CPI excludes food and energy, so the stats you quoted are for the total CPI and are not Core CPI as you claim. Core CPI is at 0.6% this month or over 7% annually, there is nothing low about that and the media isn't really overhyping it. Inflation is still coming in hot despite the rate increases which is not good.
• giantg2 4y ago
  "Mainstream media has always been a little innumerate but this is a whole other level." It's not necessarily the numbers. They don't want to come out saying inflation looks close to normal when people feel otherwise. Not to mention, I think I did see some articles say the .1% was way unexpected and lower. I also think I saw that .4% was higher than expected. It gets oversensationalized. That happens with other topics in the media too.
• taolegal 4y ago
  Innumeracy? Sure there's tons of innumeracy in the world, but the measures of inflation are so obviously manipulated to indicate low inflation. Really the only accurate way to get a sense of inflation is expansion of the money supply - they can't really lie about that. Everything else is a measure that, in one way or another, incentivizes politicians and economists to lie about their own performance, prowess and power. Inflation too high before an election? Change the basket of goods. Substitute quality meat for some highly-processed, highly-subsidized puck of corn/soy garbage. Another thing that even the supposed numerate geniuses among us frequently ignore: inflation compounds!
• hulitu 4y ago
  > Ask HN: Why does the media say inflation is up every month? It is called propaganda. The aim it to make you afraid and then you can be easily manipulated. Inflation is high. But "media" seems particularly interested in this topic in the last few months. Usually combined with other naratives.
• dragonwriter 4y ago
  > Yet for three straight months every time these numbers come out the NY Times and other media plaster a front page story saying "Inflation is stubbornly still at 8.9%" or something, because they are choosing to use a 12 month rolling average, but they all talk about it as if that's just natural, not a choice There are good reasons (month-to-month volatility and seasonality, among others) that the 12-month trailing (not a rolling average) figure is the headline inflation number, but, yes, the media coverage is horrible, with many articles doing some or all of: (1) Reporting the 12-month trailing figure in the monthly report as monthly inflation, (2) Reporting the monthly or annual inflation rate (% change in CPI) from the monthly report as the monthly change in inflation. (3) Failing to provide, or providing incorrect, context as to the import of total vs. core CPI changes when reporting both. (4) Showing a bias in which of the three above errors are made, and how they are made, in favor of promoting fear.
• trimethylpurine 4y ago
  You said it yourself. "Mainstream media has always been a little innumerate[...]" And now mainstream media has been consolidated to just 4 or 5 conglomerate owners who play especially for politics, despite your desire to avoid that topic here. The part that's whole other level is simply the extreme conglomeration from more than 50 news sources which essentially makes it possible to spread mass marketing synergism unchecked and unchallenged. Do yourself a favor and stop watching it.
• cykros 4y ago
  Looking to mainstream general media on economic matters is usually going to land you with some skewed portrayals of reality, even in the event they're not resorting to outright lies or inaccurate statements, either because they assume their audience won't understand, because THEY don't understand, or both. I find that at least resorting to something like Bloomberg or Reuters will get a little bit more context around the numbers that isn't completely bizarro, but there is still a pretty high noise:signal ratio there, especially as half of what comes out on the air is someone's projection going forward (think of it as a fairground full of fortune tellers all showing you how shiny their crystal ball is). I'd also point out that the figures are YoY (Year on Year) rather than monthly changes, but it seems that's been discussed ad nauseam here so elaboration shouldn't be necessary. The one thing I'll point out there is that this is normal across MOST rates unless otherwise stated (your 3 month CD isn't yielding 3% over the next 3 months, it's yielding an annualized rate of 3%, or roughly 0.75% on the principal over its lifetime. This avoids unnecessarily comparing apples to oranges, but can certainly mislead someone who isn't expecting this to be the way things are done.
• mitthrowaway2 4y ago
  Does your employer adjust your wage every month? If not, you probably care about the year-over-year figure.