My hoot of the day is Paul Krugman himself. Readers blast him on Twitter. 
No Joke
“The joke was if you take all the stuff going up out of the index, you have no inflation. That was supposed to be a joke, not taken literally by a Nobel Laureate.“
An Enemy of the Public
The Unfalsifiable Krugman
Not Just Krugman
Bill: “Your monthly reminder that inflation is receding & is no longer become an issue the markets care about. My preferred measure of core CPI ex: OER has been falling for over a year and is now under 3%.”
Ben: “Yes, if it weren’t for our consumption of food, housing and energy we would be experiencing ‘manageable’ inflation. And the WH is mystified that Americans are dissatisfied with the economy and think inflation is a problem.”
Me: The idea that inflation is no longer an issue is ridiculous. That said, I do understand the misguided point of view on Owner’s Equivalent Rent (OER). OER is the imputed price one would pay to rent one’s own house from himself, unfurnished and without utilities. The point being OER is not an actual expense for people who own their own home. About 66 percent of the population owns their own home.
What About the 34 Percent?
34 Percent of the population rents. And the price of rent is increasing like mad.
Do we throw renters under the bus?
CPI Rises More Than Expected as Rent Jumps Another 0.6 Percent
Earlier today I noted CPI Rises More Than Expected as Rent Jumps Another 0.6 Percent
I repeat the core key theme for something like two years now. People keep telling me rents are falling, I keep doubting. The doubters have it correct again.
Rent of primary residence, the cost that best equates to the rent people pay, jumped 0.6 percent. Rent of primary residence has gone up at least 0.4 percent for 26 consecutive months!
All these “rents are falling” projections have been based on the price of new leases, but existing leases, vastly more important, keep rising.
Krugman will counter that rent is lagging. It has lagged for 26 months now.
CPI Year-over-Year
Year-over-year, rent has increased at least 7.2 percent every month since September of 2022 and at least 4.2 percent every month since February of 2022. That’s every month for 20 months.
Don’t worry, it’s lagging. Victory declared.
Meanwhile, please note the blue arrow in the above chart.
The downward trend in year-over-year CPI inflation is broken. It was 3.0 percent with much cheering in June. It’s now 3.7 percent for the past two months. Don’t worry. Victory declared.
Victory Over What?
Paul Krugman, a Nobel prize winner, and his supporters, have no idea what Inflation is or how it should be measured.
Add the Fed to that list.
Not a one of them remotely understands that asset bubbles, especially housing, are a measure of inflation. Home prices are not in the CPI at all, and that is a huge problem.
The reason given for home price not in the CPI is that housing is a capital expense, not a consumer expense.
My counter is so what? No one seems to realize that “inflation matters, not just consumer inflation”.
Case-Shiller Home Price Index Vs CPI and Rent
For 12 years, home prices, OER, Rent, and the overall CPI all rose together. That changed in 2000 with another trendline touch in 2012. Then it was off to the races as the Fed did round after round of QE, suppressing mortgage rates.
Case-Shiller Home Price vs Hourly Earnings, the CPI, and Rent
As with the previous chart, for 12 years, home prices, rent, the overall CPI and hourly earnings all rose together. That changed in 2000 with another trendline touch in 201
Home price vs hourly earnings are back at an all-time high.
Don’t worry says Krugman, that’s not even inflation. Home prices are not even in the index so that Krugman can ignore them.
Asset Bubbles and Home Prices are a Result of Inflation
Dear Paul, asset bubbles, especially home prices, are a result of free money, reckless QE, and too cheap interest rates.
This is too complicated for a Nobel Laureate to understand. It’s also too complicated for the Fed as well.
How the Fed Destroyed the Housing Market and Created Inflation in Pictures
For further rebuttal of the preposterous idea that we can claim victory over inflation, please see How the Fed Destroyed the Housing Market and Created Inflation in Pictures
I present 11 images as rebuttal to Krugman’s nonsensical Tweet.
On Krugman’s NY Times blog many times he would use the IS-LM Model as if it were common knowledge on his blog post to illustrate the liquidity trap during and after the Great Recession. I’m sure it’s in his textbook but still not everybody took intro macroecon at an Ivy.
TV set inflation ex food energy education healthcare housing
I mean, it’s true the economy is doing well, and inflation if not under target is somewhat contained. But, that was at the cost of a wartime deficit that has to continue to avoid a recession, and rates at above 4% for the foreseeable future that will have a cost on an economy with a 4x debt/gdp ratio.
This idea that somehow rates will be raised enough to tame inflation, and create a sharp slowdown is wrong. Do we really believe the Fed will keep rates at +5% for long, increasing the governments debt servicing cost to unsustainable levels? Can you imagine rates at 8% and the government paying 50% of its’ revenue toward interest held by wealthy entities? Nope, inflating our way out of this debt mess is the more palatable solution. It’s always easier to blame outside entities for inflation, and most people don’t think in real terms, only nominal terms. So, looking at your 401K, you think you are doing really well, not realizing you can’t buy anything with it.
Yes, I can imagine 8 percent, because the Federal Reserve has stepped aside, as they realize that they can’t solve the deficit problem. The Fed is giving Congress the rope that Congress needs to hang its self.
I predict the US economy will grow in 2024, unless it shrinks.
My previous prediction, from 1997, on the climate, Nobel prize pending:
“The global climate will get warmer, unless it gets colder.”
My only other prediction from 1997 to 2023 was that aliens would invade the US. However, I predicted they would be from the planet Uranus, not from South America, so I was only half right.
People just love predictions.
This is the academic class spitting in your face. Could he be anymore condescending?
He belongs to the club, you know, the one we’re not in….
So utterly disconnected, he truly believes the sh*te coming out of his mouth.
And then there’s the media, repulsively shilling for their corporate masters.
These CPI numbers are so utterly ridiculous, it’s a mystery to me why the whole financial world keeps taking them seriously.
The Big Short – “It’s possible that we are in a completely fraudulent system.”
No Mish, it’s YOU who doesn’t understand what inflation is.
Price rises are NOT inflation.
“Inflation is always and everywhere, a monetary phenomenon” means that inflation is a result of expanding the money supply through extension of credit; credit is not expanding, ergo the price rises are not inflation.
Price rises in this case are policy driven, politically driven… Ever since lockdowns, then you have mass illegal immigration, sanctions, you name it – all politics, driving up prices, but not inflation.
Interest rate rises are a function of the inherent risk in unprecedentedly large abd growing debt, used to fund political agendas, bith ideological, and to mask corruption.
Tell me what other reason oil and rates are rising, because housing isn’t.
If I create hundred-thousand-million-billion dollars today, and put it in a hole in my garden, and don’t tell anyone… Then the money supply went up, but is there price inflation already then? No.
Only after spending it and having it start to circulate will money supply translate into price inflation (the latter being what most people see as “inflation”).
There’s always a delay.
Yes, there is a delay. But that delay is the corruption inspired mechanism that enables the Fed’s connected criminal Banker friends, who get the money FIRST, to cheat everybody else down later down the line that get hit with the loss of purchasing power for the same amount of dollars.
“Readers blast him on Twitter”
—
Krugman “apologized” in an NYT article for having called rising inflation “transitory”. The apology meant nothing.
He has also been schooled repeatedly by many in the NYT comments of his various related articles that his takes on inflation are at best, misguided and at worse, a sign of incorrigible stubbornness.
I do not believe that Paul Krugman is dumb.
I think he is very smart and like the whole elite knows exactly what to say to keep the majority of the population from doing something unpredictable.
Mish does not even wish to consider that possibility.
At the least, taxes should be included in the CPI.
Now, whether US Gov spending should be in the CPI rather than taxes is an interesting question.
The CPI is a basket of about 80,000 items — goods and services, not a measure of government spending or taxes.
What items are in CPI?
The Consumer Price Index (CPI) consists of a family of indexes that measure price change experienced by urban consumers. Specifically, the CPI measures the average change in price over time of a market basket of consumer goods and services. The market basket includes everything from food items to automobiles to rent.
“should”
That is to say, an index that included taxes with CPI-y things would be a better indication of the value of cash relative to the things needed by typical people.
Well said. The last time I checked, INCOME TAXES are a non-optional COST OF LIVING in the USA (and everywhere else, for that matter).
The TAX everyone on a Social Security Pensions ABOVE $32,000 (married filing jointly) MUST pay NOW, versus 1983 (and NEVER adjusted by the IRS for inflation since then), is just ONE of SEVERAL “irrelevant items” not counted by the BLS CPI BS math.
The claim that Social Security pensions have “kept up with inflaton” is, to put it mildly, wishful thinking.
WHY? There are a number of economics statistics based reasons, but the most glaring one is the fact that the max income you can make on Social Security without being taxed (for married filing jointly) has NOT been adjusted for inflation since 1983 (Yes, I, know the CPI does not DO “taxes”, but the last time I checked, TAXES are a non-optional part of EVERYONE’S COST OF LIVING).
So, if you made, according to the CPI (I use the BLS computed CPI math for the sake of non-argument, though a look at what a whopper, a house, or just about any other commonly purchased item in the USA, costs today versus, for example, 1965, makes the CPI look woefully low balled), $32,000 in 1983, you need to make $98,888 to have the same purchasing power in 2023. Very few people on Social Security make that much now. Yet, every penny those $66,888 ($98,888 – $32,000) they MUST make to have the SAME purchasing power they had with $32,000 in 1983, is taxed ABOVE the “minimum” rate.
So, a reality based person must admit that Social Security Pensions HAVE NOT kept up with inflation. Social Security HAS NOT been “protected”. Just like Medicare, it covers less and less of the percentage of sine qua non products and services the elderly require to live with dignity.
Folks, you got to listen to Krugman. He is an expert at anal-ysis and forecasting:
“By 2005 or so, it will become clear that the Internet’s impact on the economy has been no greater than the fax machine’s.” – Krugman in 1998.
Krugman was right on that predIction\. The internet effect on labor productivity was only for a few years in the 1995 TO 2000 period.
An economist can be right in up to 9 out of 10 years by being bullish on the US economy every year of every decade.
If an economist predicts a recession that does not happen that year, or at least the first half of the next year, he could lose his job, especially if he works in the investment industry.
So are you contending that increases in ‘productivity’ after 2000 were offset by various time-wasting apps and sites? Just moving beyond dial-up modems is a significant boost in productivity.
That notwithstanding, the quote isn’t about productivity:
“The growth of the Internet will slow drastically, as the flaw in ‘Metcalfe’s law’–which states that the number of potential connections in a network is proportional to the square of the number of participants–becomes apparent: most people have nothing to say to each other! By 2005 or so, it will become clear that the Internet’s impact on the economy has been no greater than the fax machine’s.” Paul Krugman quote from 1998
OK, inflation was transitory, then we better remove transitory from the vocab. Now inflation is beaten as the biggest loser in the economic world, Krugman, does not know that this is nothing but the bottom of a 2nd wave in CPIflation that is ready to head up into a 3rd wave very soon. All the charts are telling us this and now we have Krugman playing smugman to cement our views.
Inflation is the increase in the supply of currency. We have always had about 6.5% annual inflation on average. Greenspan publicly said this was policy a long time ago. That is an exponential function. It must remain exponential else the Ponzi scheme will collapse into global deflation. That means all the banks go bk, all the major corporations too. Food store shelves go empty, cops don’t get paid. All of these things are coming because when the 33 trillion cannot be repaid, it’s over. 33 is a special number to these people. IT will probably not hit 34 trillion. It will probably collapse before then.
Hey, Krugman, no one is using the “Mission Accomplished” banner at the George W. Bush Presidential Center.
The banner is not on display.
Want it?
This is a Krugman Kitty:
link to soberthinking.createaforum.com
This a Powell Fed Chair doing what he consistently does:
link to soberthinking.createaforum.com
Speaking of war, with Hamas calling for a global day of Jihad tomorrow, I wonder if this could be the beginning of the end of the age as described in Matthew 24? What’s different about these signs from any other time in history, of course, is the all important Fig Tree sign with the rebirth of Israel as a nation after hundreds of years in 1948. It wouldn’t take many terrorist attacks to totally shut down the country emptying all the grocery stores. Markets worldwide would collapse, all hell breaking loose. Eventually the whole world would come under the control of an elitist government with a digital currency as private property is rejected. As suffering worsens in the world, finally a charismatic figure will show up and magically begin to solve problems bringing peace to the world for a time. It gets much worse for those who pledge their very lives to this man.There will be no easy way out rapture event before the tribulation. Most understand the rest of the story.
Psalm 12 King James Version
Help, Lord; for the godly man ceaseth; for the faithful fail from among the children of men. They speak vanity every one with his neighbour: with flattering lips and with a double heart do they speak.
The Lord shall cut off all flattering lips, and the tongue that speaketh proud things: Who have said, With our tongue will we prevail; our lips are our own: who is lord over us?
For the oppression of the poor, for the sighing of the needy, now will I arise, saith the Lord; I will set him in safety from him that puffeth at him. The words of the Lord are pure words: as silver tried in a furnace of earth, purified seven times. Thou shalt keep them, O Lord, thou shalt preserve them from this generation for ever.
The wicked walk on every side, when the vilest men are exalted.
Proverbs 1:14-19
My son, walk not thou in the way with them; refrain thy foot from their path:
For their feet run to evil, and make haste to shed blood. Surely in vain the net is spread in the sight of any bird. And they lay wait for their own blood; they lurk privily for their own lives. So are the ways of every one that is greedy of gain; which taketh away the life of the owners thereof.
It is maddening that Krugman gets any airtime. He and Friedman should be blasted into outer space along with Larry Summers.
“Not a one of them remotely understands that asset bubbles, especially housing, are a measure of inflation. Home prices are not in the CPI at all, and that is a huge problem.”
Why does almost everyone fail to discusses inflated stock prices as inflation.
We are all told to “invest” in equities because over time they “beat” inflation.
Over time that nest egg for retirement is as essential as housing.
It has occurred to me that if the Government paid close attention to “stable prices” there would be little need for us to protect ourselves from inflation.
Why on earth should government pay close attention to “stable prices” for cellphones? And Microprocessors? And for lottery tickets which just turned out to contain winning numbers?
The only thing which needs to be stable, is money supply. Exactly which individual-good “prices” this money supply happen to result in at any given time, for a quadrillion different things which changes every minute, is exactly no business of any useful government whatsoever.
I don’t know about where you live but around here the Governments have kept the prices of lottery tickets completely stable.
And by force they have kept any competition out the the business.
Oh, and “stable prices” does not mean ever increasing prices.
Duh.
“Why does almost everyone fail to discusses inflated stock prices as inflation.”
Probably because to spend a stock, you need to transform it through money. So, stocks are essentially a mechanism to avoid inflation (devaluation) of money.
I suspect that gasoline prices should decline as this decade progresses. Demand for gasoline will drop as sales of EVs increase. While diesel prices will likely increase because demand will increase.
Each barrel of oil that is refined produces roughly 19-20 gallons of gasoline and 11-12 gallons of diesel. In order to produce the diesel, which will remain in demand, refiners must keep refining more oil and thus produce more gasoline, and we should end up with a surplus of gasoline.
Lower gasoline prices won’t stop inflation, but it will help many consumers.
Of course, this assumes that governments won’t add a lot of new gasoline taxes; which they might.
Funny isnt it that gasoline pump prices are exactly the same as they were 11 years ago (chicagogasprices.com). They went up and down (way down during 2014-2020 frakking) but they are today the same as 11 years ago. Maybe inflation aint so bad?
Inflation does not bother me much, because I am pretty well off. In fact, I probably benefit to some degree from inflation.
I understand that Inflation does hurt some Americans. But complaining about it gets them nowhere. Personally, I think that their time is better spent working hard to improve their personal situation, rather than complaining.
Fortunately we live in a country that provides some of the best opportunities in the world to get ahead through working hard and smart.
Unfortunately, we seem to have also raised a generation of crybabies who waste a lot of their time complaining, rather than getting ahead.
I heard that EV component prices (mainly batteries) are going up? Nevertheless I think your conclusion is right, because oil is always cyclical. Govt intervention like prohibiting drilling, or taxation, could throw that off.
The cost of EV batteries declined by close to 80% from 2010 to 2021 as the tech got better. Since then they have increased by a few %. I suspect that they have levelled off until some new tech breakthrough happens which will start a new downward trajectory in battery prices and possibly cheaper EVs.
If EV prices decline enough, sales will keep increasing. The catch 22 is that the more EV sales increase, the fewer ICE sales there will be, and the less demand for gasoline; which will force down gasoline prices and reinvigorate ICE sales.
Yes, government intervention is always a possibility.
Paul Krugman: “War on Inflation is over”😂
To remind you, ALL Nobel Prize winners missed the 2008 Great Financial Crisis! Some asserted it would not happen. Some advised Fannie Mae to give the subprime loans that are at the root cause of the GFC, then Bernanke denied housing is a problem, then he gets a Nobel prize for a different paper on Crisis, while ignoring his record.
This speaks to the quality of the Nobel Prize & its selection committee. 2 small networks of economists with political agendas award themselves & their cronies Nobel Prizes and go on to shape the gov & monetary policy of nations that gets everyone into trouble. Rinse & repeat with new faces from the same “village” and no accountability! Evidence? Check the US economic advisors who where involved in the collapse of Asian Tigers, Russia, Argentina, Greece, Subprime economies…
This is a clear example of how political ideology turn smart people into irrational thinkers. The bigger the brand & platform, the worse the damage. These policy advisors create massive economic & market inefficiencies leading to major risks for most vs. opportunities for a few.
You can Google who where the economic advisors from the US (a few years leading to the crisis and during the crisis). Also google their connections to major hedge funds who shorted the banks and/or currencies of those countries during these crisis,you will find some of the economists were useful stooges and some may have been providing snake oil advice
link to twitter.com
Couldn’t have said it better.
Is there a reverse-Krugman index just as the reverse-Cramer index for savvy investors.
In all his wisdom, he has failed to explain why the Costco CFO is warning that membership prices will increase yet again
To name one stark and consumer hitting example…
Paul Krugman is an embarrassment to the economics profession, a bought and paid for shill.
“the economics profession,” period, is a disgrace, and absolutenly nothing else, to economics.
The entire lot of them, are nothing but mediocrities who couldn’t hack in in the hard sciences. So instead found themselves a hideout where they can pretend to be “smart” simply by doing the only thing their meager intellect affords them to do: Mindlessly regurgitate jargon heavy, utterly illogic drivel, non of which has ever had any, whatsoever, basis in anything other than pure makebelieve.
And, par for the course: The same pile of putrid, disgusting, negative-intellect indoctrinati who fall for the, just as trivially obvious, nonsense that rank idiots on “Wall Street” are somehow “smart” because “they have money”; also continue to fall for the pure and utter childish nonsense “the economics profession” is spewing. Since, like, they are, like, “experts” from, like, Harvard and, like, stuff…
For anyone with any sort of standards: The entire “economics profession” are, to a person, dumb as manure. Just as are the idiots living large off of Fed redistribution on “Wall Street.” Every.single.one.of.them. The only ones even dumber, are the useless, brownnosing dittoheads who can’t even figure that out.
Agreed!
WE?
WON?
Drugs will kill you, Paul. Please take more.
krugman is a leftist shill and alt-left goon. Everything he writes is left wing propaganda and lies. He is 100% untrustworthy and a genuine disgrace.
I think the rise in rates is pushing rents up because landlords must now or relatively soon, refinance their note with a higher rate. Harder to cover your debt service when your rate gets jacked up and rent stays the same — especially how far it’s gone in such a short period of time.
And dont forget property taxes (paid with rents) which fund the retirements of millions of cops, firemen and teachers (all well paid.) We hit the peak of numbers of people turning 65 this year more or less (it peaks over 3 years). The baby boomers have finally hit their peak. And all of the ones working in government want their pensions. That plus a shortage of any housing at all due to housing being bought up en masse funded by 0% money available to hedge funds and private equity from 2004 thru 2020. Thats why rents are ridiculous now. Same as in the UK.
Additionally, landlords took a real financial hit when the government froze evictions during and well after COVID. Landlords need to make up for that lost income because their expenses were never paused.
Oh, really? Two years ago, my two-liter of diet soda was $1.79. It is $2.59 now. When inflation is beaten, rather than only being tied, I should get back my $1.79, shouldn’t I?
No, Mr. Krugman, because you have no idea how to beat inflation.
We used to shop at a discount supermarket in Michigan (Meijers) that was about 20% cheaper than Krogers. Not we shop at Aldi which is 20% or more cheaper than the discount supermarket.
Shop at Aldis
Prices like it was 2015 again!
Not a large selections but two liter Coke or Diet Coke is $1.89
Jif peanut Butter 40 ounce is $7.39 at Meijers, a Michigan discount chain, versus Aldi’s brand 40 ounce PB at under $$4.00, and this peanut butter lover can’t tell the difference.
One dozen small eggs not much over $1.00 at Aldi
NOTE: I don’t own stock in Aldi — it is privately owned by Europeans who also own Trader Joes, which has a few bargains, but nothing like Aldi.
Aldi is cool. But we don’t have ’em in Cali, it’s mostly the midwest. The Aldis in Europe are even better. They have fresh baked bread and stuff like that.
Just goes to show how meaningless the Nobel Prize has become.
Most Nobel Prizes are meaningful.
It’s the peace and economic prizes that are attempts at concealed humor.
Inflation in the cost of capital, equipment, land, houses, whatever, eventually flows through to inflation in consumer costs. It has to, because it is part of the unit cost of production. Maybe there is a lag, or maybe excluding capital expenses smooths the curve out a bit, but eventually they have to balance or the price paid for consumer items will not justify the capital expense required. They can mess with this a bit via interest rates, which when low reduce the cost of capital, but only so long as they can suppress interest rates. Once interest rates start to rise, the price paid for produced goods must rise to cover the higher cost of capital.
Price inflation is caused by money supply inflation, which is caused by the Fed buying bonds.
The root cause has been federal budget deficits that the Fed has helped fund by buying Treasury bonds in the open market, to give bond investors cash to buy new Treasury bonds.
The federal deficit is large in 2023, as in 2021, but this year the Fed is NOT buying bonds, so the inflation rate has fallen from 2022 (caused by 2021 Fed bond purchases) because the Fed is not currently feeding the M2 money supply.
Gas prices inflation do not cause a general price inflation
Labor costs inflating do not cause a general price inflation
The M2 money supply inflating does cause a general price inflation, with a lag.
Fed purchases of bonds cause a general price inflation because the “credit” to purchase the bonds is created by the Fed out of thin air, with a flick of the wrist — like a magician.
Krugman is a total fool.
Fat chance…unless we can keep rates high for the next ten years.
Vacancies in 5+ units are rising, the waiting list has shrunk.
Krugman…..always a day late and a dollar short.
He says what he’s told to say.
And a consistent source of happy talk BS.
Because as Mish noted it is nearly impossible to find a nice, neat number to explain our 340-million person purchasing trends, I think the people who do calculate the inflation numbers realize their numbers are crap. And that is why there is only one set of real purchasing numbers that they trust that are public, market-driven, non-adjustable and cover nearly every element of a modern economy: pump prices. Gas prices are really all that matter when it comes to determining inflation.
BS!!!
Here’s your number, Scott: Try 7M illegals having run across the border in the last 32 months? That’s THE REASON rent is increasing, bar none. And unfortunately, Mish continues to write the exact same article over and over and over without sticking his neck out to put the real cards on the table.
The other big number is the $2T deficit spending the UniParty approved for CY ’23 and will do again for CY ’24. Hell, they actually SUSPENDED the debt ceiling for another 15 months.
So there’s your causal relationship: ILLEGALS + DEFICIT SPENDING means the top 40% are racking in tons of money from their CD’s & treasuries right now. It’s something like $1.5-2T each quarter, free & guaranteed money to spend like drunken sailors as Wolf constantly points out.
Jump on the train and start making the point that matters: ILLEGAL IMMIGRATION IS THE UNDERLYING REASON FOR INFLATION IN AMERICA. Think of all the relatively cheaper labor that’s available for services to muster and do business with.
If the entire nation had the FLAUSA labor policies, inflation would plummet like a rock in 3-6 months. A whole lot of crap wouldn’t get done, but America’s savings rate would also jump through the roof.
My anecdotal recession indicator is the # of tree cutting trucks that fill up at the local pack & shack each day. It’s STILL sky high, so there’s no end in sight to this inflation.
The ONLY cure is a RECESSION and not some pantywaist soft-landing BS of a recession. Like a real one that pushes unemployment up to at least 7%. Hell, unemployment will slowly rise above 4% by early next year from workers sitting on the sidelines re-entering the labor force.
I didnt say anything about what CAUSES inflation. I said the best way to MEASURE it is pump prices. Read first.
The best way to measure it is through the cost of illegal immigrants poring into the country. Sure, they make gas prices go up. So what? It’s nothing more than the side affect of the underlying cause. And BTW, they also make food, rent, healthcare, insurance, and all sorts of other goods & serices all the while pushing down wages. 99% of these people work for cash.
You’ll know when a CBDC is about to hit when Congress approves anyone living here illegally to be able to get a checking account and a tax ID. This way they can move towards eliminating cash. Right now, there’s SO MUCH CASH being transferred to & from all of these illegals, a CBDC would never work, because you can’t force them to give up their cash paychecks.
No, man, gas prices are a correlation to the root cause: illegal immigration.
And FJB is doing everything he can to give a s’ton of these illegals all sorts of free stuff. Hell, up in NYC, the illegals are not allowed to work for 6 months, but all of the adult, male aged ones are actually working. So they’re getting government assistance and cash under the table.
Get real, man. High gas prices are a symptom like a headache from having COVID.
Sorry for being so terse, but everyone had better start to wake up. America is literally being overrun. Go watch the latest Tucker ep #30. It’s utterly mindboggling. The likelihood of a coordinated terrorist attack on American soil is most likely through the roof. A good friend of mine’s dad used to work for DHS, and he knows a guys who’s still in the sh!t. He’s telling all of his friends that you shouldn’t be going out into public without carrying.
Again, sorry for be so upset, but please stop acting like it’s all about gas prices. Sure, the price of gas affects almost everything, so it’s very important. but the trends clearly show that CORE PCE inflation is being driven primarily by increases in RENT. And certainly, there are other reasons than illegal immigration that are driving these increases, but absolutely no one with any real sway, Larry Summers for example, is willing to stick their neck out to point the finger at this major driver: illegals who have to live somewhere are pushing up rent prices.
link to twitter.com
And just to be clear, there’s no great value in pointing out how critical gas prices are to measuring the rate of change in inflation. And to place so much attention on gas under values of those other factors that matter, especially rent & the fake OER.
What matters is stamping out the root causes of inflation and that starts with dealing with all of these illegals running around in the USA.
You are aware that Mexicans etc have been coming up here for generations, and I dont think it has hurt you at all. You seem very able to speak your mind. By the way, what country did your family come from? Mine from Norway/Sweden (Swedes were also considered dirt). Anyway, he who births the most wins. And since we aint birthing enough in the US these days, I’d frankly welcome every one of them under 30 up here. Or, we can die off like Italy, Spain and Japan, who also have big probs with immigration.
I think Scott is not considering the scale of illegal immigration when contrasted with times past. Per my understanding immigration was more tightly controlled before 1965. Yes, they (Mexicans and others) have been coming to the US for a long time, but the scale was much smaller and it was better controlled. And welfare was not as prevalent so immigrants had to earn their keep. It’s a hot mess now…so many people claiming asylum, how many are legit? Unaccompanied minors, etc. Terrible.
Gasoline prices were high in 2008 and consumer price inflation was low. So much for your theory.
Agreed. The only proper way to measure inflation is comparing the price difference of a reality based basket of goods and services from a point in the past to the present. Here is an example that clearly shows actual inflation is FAR above the BLS CPI low balled BS:
I worked at a Burger King in Miami in 1965. A whopper cost 39 CENTS then. There was no ‘plain’ whopper. You could order a “whopper plain”, but the price didn’t go down because we didn’t put the veggie stuff in it. We had a double whopper then, but I won’t discuss that price difference from then to now because it is even more outrageous than that of the generic whopper price change I wish to bring to your attention. We included one slice of tomato, two pickle slices, mayo and some lettuce in a whopper. Unlike today, we kept a condiments bar stocked with free, unlimited amounts of onions, sweet relish, ketchup and mustard. Keep that in mind when you look at a 2023 Burger King Whopper selection on their menu.
Some CPI “math” for objective readers:
SOURCE: US Inflation Calculator
An item that cost $0.39 in 1965 would cost $3.81in 2023.
Cumulative rate of inflation: 877.1%.
The CHEAPEST Whopper you can buy in the USA in 2023 costs at least $7.00 (if you aren’t in Los Angeles or San Francisco, California, where it costs about DOUBLE that!).
So, $7.00 – $3.81 = $3.19 the CPI DOES NOT account for. The actual inflation from 1965 to 2023 in regard to the cheapest whopper, including the FACT that there are no free extra onions, is SIX DOLLARS and Sixty One cents.
No, I don’t eat out, and haven’t eaten out for many years, so don’t tell me to stay home. I think people should brown bag instead of wasting money buying their lunches at restaurants or fast food places, but if you want to do that, eat out to your wallet’s “content”.
The 2023 Cumulative rate of inflation for the 1965 whopper is NOT 877%. The 2023 Cumulative rate of inflation for the 1965 whopper is a WHOPPING 1,694%.
For those who say I am “cherry picking”, please note that I focused on a low priced item. Anyone with a passing knowledge of economics knows that corporations that cater to the poor and middle class have VERY thin profit margins. They push volume sales HARD because they cannot afford to price the low income folks out of their products. Thus, these corporations raise prices ONLY when INFLATION FORCES THEM TO DO SO, PERIOD. So, the whopper price change over the years is a reality based way of getting a ball park estimate of inflation. We are being LIED TO BIG TIME by the BLS.
I agree completely with Ben Hunt:
Ben Hunt @EpsilonTheory
Yes, if it weren’t for our consumption of food, housing and energy we would be experiencing ‘manageable’ inflation.
And the WH is mystified that Americans are dissatisfied with the economy and think inflation is a problem.
I stoped paying attention to Paul Krugman i the mid 2000s! Why are we wasting our time with him?
Ditto!
the reason home prices exploded is the fact that
inflation(really the devaluation of fiat $dollar) is why
the value has lost so much purchasing power
will home prices decrease?? $$$ wise NO – value wise yes
Meh. It’s good for a laugh. I’ve learned a lot from reading smart people debunk Paul Krugman