4 ms·

MoM inflation is still unfortunately 0.4% which is about 5% annualized. I think it's unfortunate that reporting focuses around yearly inflation which isn't real

by slaymaker1907 4y ago

MoM inflation is still unfortunately 0.4% which is about 5% annualized. I think it's unfortunate that reporting focuses around yearly inflation which isn't really useful for talking about inflation in the moment.

roflyear 4y ago
5% is not that much higher than historic averages. 1990 had 5.4% inflation, and 2008 close to 4%.
- ethagknight 4y ago
  Worse than 2008, got it.
  - roflyear 4y ago
    I am not sure that we can predict how bad a recession will be based on inflation.
    - qclibre22 4y ago
      Some claim you can: "The historical evidence indicates that when inflation is as high as it is today, and the unemployment rate is as low as it is today, the probability of a recession over the next one and two years is extraordinarily high" source: https://www.hks.harvard.edu/sites/default/files/centers/mrcbg/files/Recession_blog.pdf https://www.hks.harvard.edu/sites/default/files/centers/mrcb...
      - roflyear 4y ago
        Probability of recession, but severity?
  - smileysteve 4y ago
    Well, yes, and no, the crash of 2008 caused deflationary pressure, and below [Federal Reserve] (annualized average) target inflation until 2020.
- rufus_foreman 4y ago
  5.4% in 1990 was the highest rate in an almost 40 year stretch. In 1991 it went down to 4.2% and then wasn't above 4% until last year.
sparrc 4y ago
Interesting, that does seem like a more useful metric. Where do you find that data?
- tenpies 4y ago
  It's part of the whole BLS report, here: https://www.bls.gov/news.release/cpi.nr0.htm https://www.bls.gov/news.release/cpi.nr0.htm You may also be interested in what is referred to as "sticky CPI" which is reported by the Atlanta Fed: https://www.atlantafed.org/research/inflationproject/stickyprice https://www.atlantafed.org/research/inflationproject/stickyp... The name is fairly descriptive of what it is: the slowest re-acting elements of the CPI calculation. This is contrasted with the "flexible" CPI, which are the elements that react the fastest. In the last report, Sticky CPI was constant (no change), whereas all the decrease in CPI came in the flexible side of things.

roflyear 4y ago

5% is not that much higher than historic averages. 1990 had 5.4% inflation, and 2008 close to 4%.

ethagknight 4y ago
Worse than 2008, got it.
- roflyear 4y ago
  I am not sure that we can predict how bad a recession will be based on inflation.
  - qclibre22 4y ago
    Some claim you can: "The historical evidence indicates that when inflation is as high as it is today, and the unemployment rate is as low as it is today, the probability of a recession over the next one and two years is extraordinarily high" source: https://www.hks.harvard.edu/sites/default/files/centers/mrcbg/files/Recession_blog.pdf https://www.hks.harvard.edu/sites/default/files/centers/mrcb...
    - roflyear 4y ago
      Probability of recession, but severity?
- smileysteve 4y ago
  Well, yes, and no, the crash of 2008 caused deflationary pressure, and below [Federal Reserve] (annualized average) target inflation until 2020.
rufus_foreman 4y ago
5.4% in 1990 was the highest rate in an almost 40 year stretch. In 1991 it went down to 4.2% and then wasn't above 4% until last year.

sparrc 4y ago

Interesting, that does seem like a more useful metric. Where do you find that data?

tenpies 4y ago
It's part of the whole BLS report, here: https://www.bls.gov/news.release/cpi.nr0.htm https://www.bls.gov/news.release/cpi.nr0.htm You may also be interested in what is referred to as "sticky CPI" which is reported by the Atlanta Fed: https://www.atlantafed.org/research/inflationproject/stickyprice https://www.atlantafed.org/research/inflationproject/stickyp... The name is fairly descriptive of what it is: the slowest re-acting elements of the CPI calculation. This is contrasted with the "flexible" CPI, which are the elements that react the fastest. In the last report, Sticky CPI was constant (no change), whereas all the decrease in CPI came in the flexible side of things.