Inflation – Has it arrived?

[Rich Toscano]

[quote=socrattt]
You just made me laugh out loud!! You can go to http://www.ifluffnumbers.com and I have next weeks lottery numbers up there as well. If you think for one moment that inflation is dormant you may need a psychiatric evaluation.

You’ll be riding your bicycle to the store to pick up your $10 gallon of milk and $7 loaf of bread by the end of year and you’ll still turn to your inflation data site thinking it’s a “whole lot of nuthin”. That’s just pathetic that you even put that link on here. They must have an app for that![/quote]

Totally weak reply… he brings data, you bring a personal attack. Raise the bar! If you think the data he cites is invalid, bring your own data to the table and explain why, don’t just call him names.

[Rich Toscano]

[quote=sdduuuude]Been out of town for a week. Good discussion here. Just for fun, I looked at the actual inflation rates:

http://inflationdata.com/Inflation/Inflation_Rate/CurrentInflation.asp

Not sure what all the fuss is about. I can’t say I consider a range of 1.14% to 2.63% more than marginally inflationary?

Seems like a whole lot of nuthin’ to me.
[/quote]

I can’t speak for others, but to me, the “fuss” on this topic is that we’ve gone from rampant deflation hysteria six months ago to firmly positive inflation now. The YOY numbers you cited tend to smooth over recent rates of change which can be seen in the CPI or in the more up to date inflation measure coming from MIT (fyi, the timeline on the MIT chart is created automatically so I picked the same timeline for the cpi chart):

[img_assist|nid=14686|title=cpi|desc=|link=node|align=left|width=400|height=216]

[img_assist|nid=14687|title=bpp|desc=|link=node|align=left|width=400|height=360]

Additionally, there has been notably faster inflation in food and energy prices, though some of that has not yet leaked through to the consumer level. A major premise of “inflationists” (at least of mine) has been that inflation will not likely be across the board but will probably be more apparent in items that are in shorter supply, that people need, and that are sought after globally. So a rise in food and energy prices alongside a flatter core CPI may seem like a more significant development to us than to you.

So that’s what the fuss is about, to the extent there is a fuss. That said I agree I certainly that current levels of inflation are not super problematic, at least not in this country. I think the idea here is to try to understand what current trends imply for the future.

Personally, I don’t believe this is the “big one”… I think it’s coming, but not until after our foreign creditors panic.

[Rich Toscano]

[quote=sdduuuude]Been out of town for a week. Good discussion here. Just for fun, I looked at the actual inflation rates:

http://inflationdata.com/Inflation/Inflation_Rate/CurrentInflation.asp

Not sure what all the fuss is about. I can’t say I consider a range of 1.14% to 2.63% more than marginally inflationary?

Seems like a whole lot of nuthin’ to me.
[/quote]

I can’t speak for others, but to me, the “fuss” on this topic is that we’ve gone from rampant deflation hysteria six months ago to firmly positive inflation now. The YOY numbers you cited tend to smooth over recent rates of change which can be seen in the CPI or in the more up to date inflation measure coming from MIT (fyi, the timeline on the MIT chart is created automatically so I picked the same timeline for the cpi chart):

[img_assist|nid=14686|title=cpi|desc=|link=node|align=left|width=400|height=216]

[img_assist|nid=14687|title=bpp|desc=|link=node|align=left|width=400|height=360]

Additionally, there has been notably faster inflation in food and energy prices, though some of that has not yet leaked through to the consumer level. A major premise of “inflationists” (at least of mine) has been that inflation will not likely be across the board but will probably be more apparent in items that are in shorter supply, that people need, and that are sought after globally. So a rise in food and energy prices alongside a flatter core CPI may seem like a more significant development to us than to you.

So that’s what the fuss is about, to the extent there is a fuss. That said I agree I certainly that current levels of inflation are not super problematic, at least not in this country. I think the idea here is to try to understand what current trends imply for the future.

Personally, I don’t believe this is the “big one”… I think it’s coming, but not until after our foreign creditors panic.

[Rich Toscano]

[quote=sdduuuude]Been out of town for a week. Good discussion here. Just for fun, I looked at the actual inflation rates:

http://inflationdata.com/Inflation/Inflation_Rate/CurrentInflation.asp

Not sure what all the fuss is about. I can’t say I consider a range of 1.14% to 2.63% more than marginally inflationary?

Seems like a whole lot of nuthin’ to me.
[/quote]

I can’t speak for others, but to me, the “fuss” on this topic is that we’ve gone from rampant deflation hysteria six months ago to firmly positive inflation now. The YOY numbers you cited tend to smooth over recent rates of change which can be seen in the CPI or in the more up to date inflation measure coming from MIT (fyi, the timeline on the MIT chart is created automatically so I picked the same timeline for the cpi chart):

[img_assist|nid=14686|title=cpi|desc=|link=node|align=left|width=400|height=216]

[img_assist|nid=14687|title=bpp|desc=|link=node|align=left|width=400|height=360]

Additionally, there has been notably faster inflation in food and energy prices, though some of that has not yet leaked through to the consumer level. A major premise of “inflationists” (at least of mine) has been that inflation will not likely be across the board but will probably be more apparent in items that are in shorter supply, that people need, and that are sought after globally. So a rise in food and energy prices alongside a flatter core CPI may seem like a more significant development to us than to you.

So that’s what the fuss is about, to the extent there is a fuss. That said I agree I certainly that current levels of inflation are not super problematic, at least not in this country. I think the idea here is to try to understand what current trends imply for the future.

Personally, I don’t believe this is the “big one”… I think it’s coming, but not until after our foreign creditors panic.

[Rich Toscano]

[quote=sdduuuude]Been out of town for a week. Good discussion here. Just for fun, I looked at the actual inflation rates:

http://inflationdata.com/Inflation/Inflation_Rate/CurrentInflation.asp

Not sure what all the fuss is about. I can’t say I consider a range of 1.14% to 2.63% more than marginally inflationary?

Seems like a whole lot of nuthin’ to me.
[/quote]

I can’t speak for others, but to me, the “fuss” on this topic is that we’ve gone from rampant deflation hysteria six months ago to firmly positive inflation now. The YOY numbers you cited tend to smooth over recent rates of change which can be seen in the CPI or in the more up to date inflation measure coming from MIT (fyi, the timeline on the MIT chart is created automatically so I picked the same timeline for the cpi chart):

[img_assist|nid=14686|title=cpi|desc=|link=node|align=left|width=400|height=216]

[img_assist|nid=14687|title=bpp|desc=|link=node|align=left|width=400|height=360]

Additionally, there has been notably faster inflation in food and energy prices, though some of that has not yet leaked through to the consumer level. A major premise of “inflationists” (at least of mine) has been that inflation will not likely be across the board but will probably be more apparent in items that are in shorter supply, that people need, and that are sought after globally. So a rise in food and energy prices alongside a flatter core CPI may seem like a more significant development to us than to you.

So that’s what the fuss is about, to the extent there is a fuss. That said I agree I certainly that current levels of inflation are not super problematic, at least not in this country. I think the idea here is to try to understand what current trends imply for the future.

Personally, I don’t believe this is the “big one”… I think it’s coming, but not until after our foreign creditors panic.

[Rich Toscano]

[quote=sdduuuude]Been out of town for a week. Good discussion here. Just for fun, I looked at the actual inflation rates:

http://inflationdata.com/Inflation/Inflation_Rate/CurrentInflation.asp

Not sure what all the fuss is about. I can’t say I consider a range of 1.14% to 2.63% more than marginally inflationary?

Seems like a whole lot of nuthin’ to me.
[/quote]

I can’t speak for others, but to me, the “fuss” on this topic is that we’ve gone from rampant deflation hysteria six months ago to firmly positive inflation now. The YOY numbers you cited tend to smooth over recent rates of change which can be seen in the CPI or in the more up to date inflation measure coming from MIT (fyi, the timeline on the MIT chart is created automatically so I picked the same timeline for the cpi chart):

[img_assist|nid=14686|title=cpi|desc=|link=node|align=left|width=400|height=216]

[img_assist|nid=14687|title=bpp|desc=|link=node|align=left|width=400|height=360]

Additionally, there has been notably faster inflation in food and energy prices, though some of that has not yet leaked through to the consumer level. A major premise of “inflationists” (at least of mine) has been that inflation will not likely be across the board but will probably be more apparent in items that are in shorter supply, that people need, and that are sought after globally. So a rise in food and energy prices alongside a flatter core CPI may seem like a more significant development to us than to you.

So that’s what the fuss is about, to the extent there is a fuss. That said I agree I certainly that current levels of inflation are not super problematic, at least not in this country. I think the idea here is to try to understand what current trends imply for the future.

Personally, I don’t believe this is the “big one”… I think it’s coming, but not until after our foreign creditors panic.

[CA renter]

[quote=SD Realtor]Sorry but I do not believe that my sdge bill, or my water bill, or my food bill has only gone up by a mild 1 or 2%. Check the price of sugar and cotton. Check the price of orange juice.

Also, even before the mideast crisis the cost of oil was well above 2% what it was last year.

**********

While CAR and I do not agree on alot of things, and while I am one of those naughty investors depriving the county of precious inventory, we do agree on some basics. We both do not believe (I think) that being told that the solutions put forth during the crisis were the only way to avert financial disaster. That there could have been more well thought out ways to get past the difficult periods. I cannot speak for CAR and I am certainly not the fatalist that Arraya is, however I do share the opinion that as long as the govt keeps telling us how they saved the world, many people will believe it, cheer for it, and go happily on believing that was the best way to do it and rubber stamping future similar behavior.[/quote]

FWIW, the flipping you’ve done by buying at auctions is NOT what I’ve been complaining about. I’d prefer the banks take them back and bring them to market, but that’s another issue…

The flipping I have a problem with is when “investors” buy homes that might need some more structural and/or cosmetic work, but aren’t priced right for long-term **owner-occupiers** who want to do the job right, and who want to buy at a price that reflects the work and inconvenience they will have to deal with to bring the house to good condition (not lipstick on a pig).

These flippers dress the pigs up, lipstick and all, while covering up the REAL problems, then they put them on the market for far more than they’re worth and sell them to 3.5% FHA buyers with wide eyes and no sense. These “investors” are buying up all of the inventory that would be suitable for the more prudent, long-term buyers who want to do their own work.

I will also add that the Fed has encouraged this type of behavior because savers, after being punished for almost a decade, have lost their patience, and are looking for any way to make a few bucks. The whole thing sucks, IMHO.

——————-

As to the rest of your post, as you know, we are very much in agreement.

[CA renter]

[quote=SD Realtor]Sorry but I do not believe that my sdge bill, or my water bill, or my food bill has only gone up by a mild 1 or 2%. Check the price of sugar and cotton. Check the price of orange juice.

Also, even before the mideast crisis the cost of oil was well above 2% what it was last year.

**********

While CAR and I do not agree on alot of things, and while I am one of those naughty investors depriving the county of precious inventory, we do agree on some basics. We both do not believe (I think) that being told that the solutions put forth during the crisis were the only way to avert financial disaster. That there could have been more well thought out ways to get past the difficult periods. I cannot speak for CAR and I am certainly not the fatalist that Arraya is, however I do share the opinion that as long as the govt keeps telling us how they saved the world, many people will believe it, cheer for it, and go happily on believing that was the best way to do it and rubber stamping future similar behavior.[/quote]

FWIW, the flipping you’ve done by buying at auctions is NOT what I’ve been complaining about. I’d prefer the banks take them back and bring them to market, but that’s another issue…

The flipping I have a problem with is when “investors” buy homes that might need some more structural and/or cosmetic work, but aren’t priced right for long-term **owner-occupiers** who want to do the job right, and who want to buy at a price that reflects the work and inconvenience they will have to deal with to bring the house to good condition (not lipstick on a pig).

These flippers dress the pigs up, lipstick and all, while covering up the REAL problems, then they put them on the market for far more than they’re worth and sell them to 3.5% FHA buyers with wide eyes and no sense. These “investors” are buying up all of the inventory that would be suitable for the more prudent, long-term buyers who want to do their own work.

I will also add that the Fed has encouraged this type of behavior because savers, after being punished for almost a decade, have lost their patience, and are looking for any way to make a few bucks. The whole thing sucks, IMHO.

——————-

As to the rest of your post, as you know, we are very much in agreement.

[CA renter]

[quote=SD Realtor]Sorry but I do not believe that my sdge bill, or my water bill, or my food bill has only gone up by a mild 1 or 2%. Check the price of sugar and cotton. Check the price of orange juice.

Also, even before the mideast crisis the cost of oil was well above 2% what it was last year.

**********

While CAR and I do not agree on alot of things, and while I am one of those naughty investors depriving the county of precious inventory, we do agree on some basics. We both do not believe (I think) that being told that the solutions put forth during the crisis were the only way to avert financial disaster. That there could have been more well thought out ways to get past the difficult periods. I cannot speak for CAR and I am certainly not the fatalist that Arraya is, however I do share the opinion that as long as the govt keeps telling us how they saved the world, many people will believe it, cheer for it, and go happily on believing that was the best way to do it and rubber stamping future similar behavior.[/quote]

FWIW, the flipping you’ve done by buying at auctions is NOT what I’ve been complaining about. I’d prefer the banks take them back and bring them to market, but that’s another issue…

The flipping I have a problem with is when “investors” buy homes that might need some more structural and/or cosmetic work, but aren’t priced right for long-term **owner-occupiers** who want to do the job right, and who want to buy at a price that reflects the work and inconvenience they will have to deal with to bring the house to good condition (not lipstick on a pig).

These flippers dress the pigs up, lipstick and all, while covering up the REAL problems, then they put them on the market for far more than they’re worth and sell them to 3.5% FHA buyers with wide eyes and no sense. These “investors” are buying up all of the inventory that would be suitable for the more prudent, long-term buyers who want to do their own work.

I will also add that the Fed has encouraged this type of behavior because savers, after being punished for almost a decade, have lost their patience, and are looking for any way to make a few bucks. The whole thing sucks, IMHO.

——————-

As to the rest of your post, as you know, we are very much in agreement.

[CA renter]

[quote=SD Realtor]Sorry but I do not believe that my sdge bill, or my water bill, or my food bill has only gone up by a mild 1 or 2%. Check the price of sugar and cotton. Check the price of orange juice.

Also, even before the mideast crisis the cost of oil was well above 2% what it was last year.

**********

While CAR and I do not agree on alot of things, and while I am one of those naughty investors depriving the county of precious inventory, we do agree on some basics. We both do not believe (I think) that being told that the solutions put forth during the crisis were the only way to avert financial disaster. That there could have been more well thought out ways to get past the difficult periods. I cannot speak for CAR and I am certainly not the fatalist that Arraya is, however I do share the opinion that as long as the govt keeps telling us how they saved the world, many people will believe it, cheer for it, and go happily on believing that was the best way to do it and rubber stamping future similar behavior.[/quote]

FWIW, the flipping you’ve done by buying at auctions is NOT what I’ve been complaining about. I’d prefer the banks take them back and bring them to market, but that’s another issue…

The flipping I have a problem with is when “investors” buy homes that might need some more structural and/or cosmetic work, but aren’t priced right for long-term **owner-occupiers** who want to do the job right, and who want to buy at a price that reflects the work and inconvenience they will have to deal with to bring the house to good condition (not lipstick on a pig).

These flippers dress the pigs up, lipstick and all, while covering up the REAL problems, then they put them on the market for far more than they’re worth and sell them to 3.5% FHA buyers with wide eyes and no sense. These “investors” are buying up all of the inventory that would be suitable for the more prudent, long-term buyers who want to do their own work.

I will also add that the Fed has encouraged this type of behavior because savers, after being punished for almost a decade, have lost their patience, and are looking for any way to make a few bucks. The whole thing sucks, IMHO.

——————-

As to the rest of your post, as you know, we are very much in agreement.

[CA renter]

[quote=SD Realtor]Sorry but I do not believe that my sdge bill, or my water bill, or my food bill has only gone up by a mild 1 or 2%. Check the price of sugar and cotton. Check the price of orange juice.

Also, even before the mideast crisis the cost of oil was well above 2% what it was last year.

**********

While CAR and I do not agree on alot of things, and while I am one of those naughty investors depriving the county of precious inventory, we do agree on some basics. We both do not believe (I think) that being told that the solutions put forth during the crisis were the only way to avert financial disaster. That there could have been more well thought out ways to get past the difficult periods. I cannot speak for CAR and I am certainly not the fatalist that Arraya is, however I do share the opinion that as long as the govt keeps telling us how they saved the world, many people will believe it, cheer for it, and go happily on believing that was the best way to do it and rubber stamping future similar behavior.[/quote]

FWIW, the flipping you’ve done by buying at auctions is NOT what I’ve been complaining about. I’d prefer the banks take them back and bring them to market, but that’s another issue…

The flipping I have a problem with is when “investors” buy homes that might need some more structural and/or cosmetic work, but aren’t priced right for long-term **owner-occupiers** who want to do the job right, and who want to buy at a price that reflects the work and inconvenience they will have to deal with to bring the house to good condition (not lipstick on a pig).

These flippers dress the pigs up, lipstick and all, while covering up the REAL problems, then they put them on the market for far more than they’re worth and sell them to 3.5% FHA buyers with wide eyes and no sense. These “investors” are buying up all of the inventory that would be suitable for the more prudent, long-term buyers who want to do their own work.

I will also add that the Fed has encouraged this type of behavior because savers, after being punished for almost a decade, have lost their patience, and are looking for any way to make a few bucks. The whole thing sucks, IMHO.

——————-

As to the rest of your post, as you know, we are very much in agreement.

[sdduuuude]

[quote=Rich Toscano] I can’t speak for others, but to me, the “fuss” on this topic is that we’ve gone from rampant deflation hysteria six months ago to firmly positive inflation now. [/quote]

To me, hysteria seemed rampant in both camps, simultaneously, over the last six months. Interesting that both agree on gold.

I see no fuss here. I’ll take the under on a $10 gallon of milk in the U.S. by Jan 1, 2012.

[quote=Rich Toscano]A major premise of “inflationists” (at least of mine) has been that inflation will not likely be across the board but will probably be more apparent in items that are in shorter supply, that people need, and that are sought after globally.[/quote]

I just think there is still too much deleveraging to be done for inflation to win the day for quite some time.

Saying there will be inflation in things people need and apparent in items that are in “shorter supply” is kind of not a very bold statement. Sounds suspiciously like “demand” and “supply” will affect “prices.”

That is to say – it is entirely likely that we end up needing and/or able to afford less for the next few years.

[quote=Rich Toscano]
… I think the idea here is to try to understand what current trends imply for the future.
[/quote]

I’m seeing the oil trend up as it relates to unstable countries in the middle east – not so much related to US Currency and the Fed’s activities. I can’t find a chart of Libyan corn exports to prove that corn prices won’t be affected by the uprising.

[sdduuuude]

[quote=Rich Toscano] I can’t speak for others, but to me, the “fuss” on this topic is that we’ve gone from rampant deflation hysteria six months ago to firmly positive inflation now. [/quote]

To me, hysteria seemed rampant in both camps, simultaneously, over the last six months. Interesting that both agree on gold.

I see no fuss here. I’ll take the under on a $10 gallon of milk in the U.S. by Jan 1, 2012.

[quote=Rich Toscano]A major premise of “inflationists” (at least of mine) has been that inflation will not likely be across the board but will probably be more apparent in items that are in shorter supply, that people need, and that are sought after globally.[/quote]

I just think there is still too much deleveraging to be done for inflation to win the day for quite some time.

Saying there will be inflation in things people need and apparent in items that are in “shorter supply” is kind of not a very bold statement. Sounds suspiciously like “demand” and “supply” will affect “prices.”

That is to say – it is entirely likely that we end up needing and/or able to afford less for the next few years.

[quote=Rich Toscano]
… I think the idea here is to try to understand what current trends imply for the future.
[/quote]

I’m seeing the oil trend up as it relates to unstable countries in the middle east – not so much related to US Currency and the Fed’s activities. I can’t find a chart of Libyan corn exports to prove that corn prices won’t be affected by the uprising.

[sdduuuude]

[quote=Rich Toscano] I can’t speak for others, but to me, the “fuss” on this topic is that we’ve gone from rampant deflation hysteria six months ago to firmly positive inflation now. [/quote]

To me, hysteria seemed rampant in both camps, simultaneously, over the last six months. Interesting that both agree on gold.

I see no fuss here. I’ll take the under on a $10 gallon of milk in the U.S. by Jan 1, 2012.

[quote=Rich Toscano]A major premise of “inflationists” (at least of mine) has been that inflation will not likely be across the board but will probably be more apparent in items that are in shorter supply, that people need, and that are sought after globally.[/quote]

I just think there is still too much deleveraging to be done for inflation to win the day for quite some time.

Saying there will be inflation in things people need and apparent in items that are in “shorter supply” is kind of not a very bold statement. Sounds suspiciously like “demand” and “supply” will affect “prices.”

That is to say – it is entirely likely that we end up needing and/or able to afford less for the next few years.

[quote=Rich Toscano]
… I think the idea here is to try to understand what current trends imply for the future.
[/quote]

I’m seeing the oil trend up as it relates to unstable countries in the middle east – not so much related to US Currency and the Fed’s activities. I can’t find a chart of Libyan corn exports to prove that corn prices won’t be affected by the uprising.

[sdduuuude]

[quote=Rich Toscano] I can’t speak for others, but to me, the “fuss” on this topic is that we’ve gone from rampant deflation hysteria six months ago to firmly positive inflation now. [/quote]

To me, hysteria seemed rampant in both camps, simultaneously, over the last six months. Interesting that both agree on gold.

I see no fuss here. I’ll take the under on a $10 gallon of milk in the U.S. by Jan 1, 2012.

[quote=Rich Toscano]A major premise of “inflationists” (at least of mine) has been that inflation will not likely be across the board but will probably be more apparent in items that are in shorter supply, that people need, and that are sought after globally.[/quote]

I just think there is still too much deleveraging to be done for inflation to win the day for quite some time.

Saying there will be inflation in things people need and apparent in items that are in “shorter supply” is kind of not a very bold statement. Sounds suspiciously like “demand” and “supply” will affect “prices.”

That is to say – it is entirely likely that we end up needing and/or able to afford less for the next few years.

[quote=Rich Toscano]
… I think the idea here is to try to understand what current trends imply for the future.
[/quote]

I’m seeing the oil trend up as it relates to unstable countries in the middle east – not so much related to US Currency and the Fed’s activities. I can’t find a chart of Libyan corn exports to prove that corn prices won’t be affected by the uprising.

[Author]

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