[Rich Toscano]

[quote=sdduuuude]
I appreciate the point that it is the kind of inflation that matters, but I’m not so sure it is what most would consider inflation.

I’m giving you a hard time because it is not a useful prediction. After three years, certainly some things will rise in price while others will fall. With a prediction like “the things people need that are scarce will inflate” you can’t go wrong (and I’m not so sure that really constitutes a general “inflation” call). [/quote]

That’s not what I said. I gave three different categories of things that I think will inflate (the implication was for Americans, though I don’t think I mentioned that):

– things people need
– things that are scarce
– things that are globally traded

This is not what you you say in your paraphrased quote of me. Sorry if I wasn’t clear, but now that I’ve cleared it up, I hope that you can see that this isn’t the tautology you are implying. There are plenty of people who disagree with this so I don’t really see how you can position it as being an obvious or “can’t go wrong” statement

As for whether it constitutes a “general inflation call”… why would I care about that? I’m not interested in labels, I’m interested in trying to figure out what will happen.

[quote]
List the specific things that will inflate and the specific things that won’t and specific things that will deflate – get it right and I’ll be impressed.
[/quote]

Inflate more (this is all for Americans using dollars, and it is over a multiple-year timeframe… this is not a short term forecast):
– energy
– food
– imports
– healthcare
– hard assets

Inflate less:
– services
– discretionary goods
– rents

Inflate even less or maybe deflate:
– real estate

Deflate:
– bonds

[quote]
But saying “the things people need that are scarce will inflate” deserves me giving you a hard time because as soon as you start picking a specific basket of goods instead of a general basket of goods, you are talking about something other than inflation. You are then talking about specific commodity prices.
[/quote]

No, I am talking about a rise in the costs that matter most to people. If the price of everything you need rises by 10%, and the price of everything you could buy but don’t need drops by 10%, that’s not a wash.

Price movements in the things that people need are more important in aggregate. And in the end, when it comes to whether people feel there is inflation or not, I believe they will look at what is happening with the things that they need. I agree that this might not come through in the CPI, and a lot of people pay attention to that, but if the most important things they buy keep going up and up, I suspect that they will start to discount the importance of the CPI over time.

[Rich Toscano]

[quote=sdduuuude]
I appreciate the point that it is the kind of inflation that matters, but I’m not so sure it is what most would consider inflation.

I’m giving you a hard time because it is not a useful prediction. After three years, certainly some things will rise in price while others will fall. With a prediction like “the things people need that are scarce will inflate” you can’t go wrong (and I’m not so sure that really constitutes a general “inflation” call). [/quote]

That’s not what I said. I gave three different categories of things that I think will inflate (the implication was for Americans, though I don’t think I mentioned that):

– things people need
– things that are scarce
– things that are globally traded

This is not what you you say in your paraphrased quote of me. Sorry if I wasn’t clear, but now that I’ve cleared it up, I hope that you can see that this isn’t the tautology you are implying. There are plenty of people who disagree with this so I don’t really see how you can position it as being an obvious or “can’t go wrong” statement

As for whether it constitutes a “general inflation call”… why would I care about that? I’m not interested in labels, I’m interested in trying to figure out what will happen.

[quote]
List the specific things that will inflate and the specific things that won’t and specific things that will deflate – get it right and I’ll be impressed.
[/quote]

Inflate more (this is all for Americans using dollars, and it is over a multiple-year timeframe… this is not a short term forecast):
– energy
– food
– imports
– healthcare
– hard assets

Inflate less:
– services
– discretionary goods
– rents

Inflate even less or maybe deflate:
– real estate

Deflate:
– bonds

[quote]
But saying “the things people need that are scarce will inflate” deserves me giving you a hard time because as soon as you start picking a specific basket of goods instead of a general basket of goods, you are talking about something other than inflation. You are then talking about specific commodity prices.
[/quote]

No, I am talking about a rise in the costs that matter most to people. If the price of everything you need rises by 10%, and the price of everything you could buy but don’t need drops by 10%, that’s not a wash.

Price movements in the things that people need are more important in aggregate. And in the end, when it comes to whether people feel there is inflation or not, I believe they will look at what is happening with the things that they need. I agree that this might not come through in the CPI, and a lot of people pay attention to that, but if the most important things they buy keep going up and up, I suspect that they will start to discount the importance of the CPI over time.

[Rich Toscano]

[quote=sdduuuude]
I appreciate the point that it is the kind of inflation that matters, but I’m not so sure it is what most would consider inflation.

I’m giving you a hard time because it is not a useful prediction. After three years, certainly some things will rise in price while others will fall. With a prediction like “the things people need that are scarce will inflate” you can’t go wrong (and I’m not so sure that really constitutes a general “inflation” call). [/quote]

That’s not what I said. I gave three different categories of things that I think will inflate (the implication was for Americans, though I don’t think I mentioned that):

– things people need
– things that are scarce
– things that are globally traded

This is not what you you say in your paraphrased quote of me. Sorry if I wasn’t clear, but now that I’ve cleared it up, I hope that you can see that this isn’t the tautology you are implying. There are plenty of people who disagree with this so I don’t really see how you can position it as being an obvious or “can’t go wrong” statement

As for whether it constitutes a “general inflation call”… why would I care about that? I’m not interested in labels, I’m interested in trying to figure out what will happen.

[quote]
List the specific things that will inflate and the specific things that won’t and specific things that will deflate – get it right and I’ll be impressed.
[/quote]

Inflate more (this is all for Americans using dollars, and it is over a multiple-year timeframe… this is not a short term forecast):
– energy
– food
– imports
– healthcare
– hard assets

Inflate less:
– services
– discretionary goods
– rents

Inflate even less or maybe deflate:
– real estate

Deflate:
– bonds

[quote]
But saying “the things people need that are scarce will inflate” deserves me giving you a hard time because as soon as you start picking a specific basket of goods instead of a general basket of goods, you are talking about something other than inflation. You are then talking about specific commodity prices.
[/quote]

No, I am talking about a rise in the costs that matter most to people. If the price of everything you need rises by 10%, and the price of everything you could buy but don’t need drops by 10%, that’s not a wash.

Price movements in the things that people need are more important in aggregate. And in the end, when it comes to whether people feel there is inflation or not, I believe they will look at what is happening with the things that they need. I agree that this might not come through in the CPI, and a lot of people pay attention to that, but if the most important things they buy keep going up and up, I suspect that they will start to discount the importance of the CPI over time.

[Rich Toscano]

[quote=sdduuuude]
I appreciate the point that it is the kind of inflation that matters, but I’m not so sure it is what most would consider inflation.

I’m giving you a hard time because it is not a useful prediction. After three years, certainly some things will rise in price while others will fall. With a prediction like “the things people need that are scarce will inflate” you can’t go wrong (and I’m not so sure that really constitutes a general “inflation” call). [/quote]

That’s not what I said. I gave three different categories of things that I think will inflate (the implication was for Americans, though I don’t think I mentioned that):

– things people need
– things that are scarce
– things that are globally traded

This is not what you you say in your paraphrased quote of me. Sorry if I wasn’t clear, but now that I’ve cleared it up, I hope that you can see that this isn’t the tautology you are implying. There are plenty of people who disagree with this so I don’t really see how you can position it as being an obvious or “can’t go wrong” statement

As for whether it constitutes a “general inflation call”… why would I care about that? I’m not interested in labels, I’m interested in trying to figure out what will happen.

[quote]
List the specific things that will inflate and the specific things that won’t and specific things that will deflate – get it right and I’ll be impressed.
[/quote]

Inflate more (this is all for Americans using dollars, and it is over a multiple-year timeframe… this is not a short term forecast):
– energy
– food
– imports
– healthcare
– hard assets

Inflate less:
– services
– discretionary goods
– rents

Inflate even less or maybe deflate:
– real estate

Deflate:
– bonds

[quote]
But saying “the things people need that are scarce will inflate” deserves me giving you a hard time because as soon as you start picking a specific basket of goods instead of a general basket of goods, you are talking about something other than inflation. You are then talking about specific commodity prices.
[/quote]

No, I am talking about a rise in the costs that matter most to people. If the price of everything you need rises by 10%, and the price of everything you could buy but don’t need drops by 10%, that’s not a wash.

Price movements in the things that people need are more important in aggregate. And in the end, when it comes to whether people feel there is inflation or not, I believe they will look at what is happening with the things that they need. I agree that this might not come through in the CPI, and a lot of people pay attention to that, but if the most important things they buy keep going up and up, I suspect that they will start to discount the importance of the CPI over time.

[Rich Toscano]

[quote=socrattt]
Rich, I got the data, I just don’t have time to post it. And I don’t really call his information data.

Unfortunately my time is important with the kids especially on the weekends hence my 30 second (no data) verbal attack. [/quote]

Fair enough I guess…

The only reason I gave you a hard time is that you typically put up pretty thoughtful posts. Consider it a compliment. 😉

[Rich Toscano]

[quote=socrattt]
Rich, I got the data, I just don’t have time to post it. And I don’t really call his information data.

Unfortunately my time is important with the kids especially on the weekends hence my 30 second (no data) verbal attack. [/quote]

Fair enough I guess…

The only reason I gave you a hard time is that you typically put up pretty thoughtful posts. Consider it a compliment. 😉

[Rich Toscano]

[quote=socrattt]
Rich, I got the data, I just don’t have time to post it. And I don’t really call his information data.

Unfortunately my time is important with the kids especially on the weekends hence my 30 second (no data) verbal attack. [/quote]

Fair enough I guess…

The only reason I gave you a hard time is that you typically put up pretty thoughtful posts. Consider it a compliment. 😉

[Rich Toscano]

[quote=socrattt]
Rich, I got the data, I just don’t have time to post it. And I don’t really call his information data.

Unfortunately my time is important with the kids especially on the weekends hence my 30 second (no data) verbal attack. [/quote]

Fair enough I guess…

The only reason I gave you a hard time is that you typically put up pretty thoughtful posts. Consider it a compliment. 😉

[Rich Toscano]

[quote=socrattt]
Rich, I got the data, I just don’t have time to post it. And I don’t really call his information data.

Unfortunately my time is important with the kids especially on the weekends hence my 30 second (no data) verbal attack. [/quote]

Fair enough I guess…

The only reason I gave you a hard time is that you typically put up pretty thoughtful posts. Consider it a compliment. 😉

[Rich Toscano]

Carlsbadworker, I think you misunderstand what I mean by the “big one.” I am referring the potential for a serious inflation.

And no, they are not panicking about our debt yet. But I feel pretty confident they eventually will.

[Rich Toscano]

Carlsbadworker, I think you misunderstand what I mean by the “big one.” I am referring the potential for a serious inflation.

And no, they are not panicking about our debt yet. But I feel pretty confident they eventually will.

[Rich Toscano]

Carlsbadworker, I think you misunderstand what I mean by the “big one.” I am referring the potential for a serious inflation.

And no, they are not panicking about our debt yet. But I feel pretty confident they eventually will.

[Rich Toscano]

Carlsbadworker, I think you misunderstand what I mean by the “big one.” I am referring the potential for a serious inflation.

And no, they are not panicking about our debt yet. But I feel pretty confident they eventually will.

[Rich Toscano]

Carlsbadworker, I think you misunderstand what I mean by the “big one.” I am referring the potential for a serious inflation.

And no, they are not panicking about our debt yet. But I feel pretty confident they eventually will.

[Rich Toscano]

[quote=sdduuuude]
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]

Yes, there are hysterical people on all sides of every argument, and I certainly agree with you on your over/under. But that doesn’t really change the point I was trying to make, which is that 6 months ago, the conventional wisdom was that serious deflation was a big risk (you need look no further than the Fed’s policy to see that). Now, here we are talking about prices of certain key items rising very rapidly.

That transition is interesting. So again, I can’t speak for anyone else, but to me the crux of this topic is not that yoy CPI is all that high (it isn’t) but that there has been a fairly rapid change in price pressures and the perceptions thereof.

[quote=sdduuuude]
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.
[/quote]

It’s not intended to be a bold statement, but nonetheless, some people seem to disagree. Even your quote above suggests this… you say that inflation will not win the day, but then in the very next sentence you give me a hard time for apparently stating the obvious when I say that the prices of things that people need will go up. Wouldn’t that be inflation? (In specific, the kind of inflation that matters — the one that concerns people’s cost of living?)

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