[RICH1]

It's obvious INFLATION is here but, how can Mr. Powell or anyone for that matter control it? It seems that the fundamentals have been ignored and consumers are creating their own problems! Will consumer demand for products decrease and prices start to fall? Didn't see this coming?

[DAVES]

Originally Posted by RICH1

It's obvious INFLATION is here but, how can Mr. Powell or anyone for that matter control it? It seems that the fundamentals have been ignored and consumers are creating their own problems! Will consumer demand for products decrease and prices start to fall? Didn't see this coming?

Not sure what is being asked. Any valid response would take books. My view, we have a huge national debt. Just like when you buy a home and take a mortgage they tell you you will pay it back with cheaper dollars. Dollars devalued due to inflation.

We hear talk about $15 minimum wage. Aside, I recall when minimum wage was .50.
We are told the CPI consumer price index is now 5%.

With a national debt, truth I've lost count and when numbers are TRILLIONS I lost comprehension at one trillion. I think it is now 30 trillion if, we devalue the real value of the dollar by 5% the CPI, What is 5% of 30 Trillion?

Destruction of savings. Reality look at the debt clock. Last time I looked, I need to collect my courage to look, the average American has 10,000 in savings and owes 85,000. A 5% loss of value or the dollar costs them 10,000-5%=500 but devalues their debt by 85,000-5%=4250. The reason deflation is so feared by people driving this thing.

Inflation, we too are guilty. We cheer that our homes are going up in value and at the same time complain that food, cars, clothes etc cost more.

Control, like most things, I am glad I do not need to make the decisions. I have the right to complain. Solutions? I need to decide what I choose to do about what is not what should be. Oh and wrong actions on my part, I need to accept responsibility and any loss for the decisions I make.

[OrangeBlossomBaby]

How to control inflation?

Put a team of efficient housewives in charge of the budget. They'll straighten it out quick in a jiffy, and have enough left over to buy ice cream for everyone.

Originally Posted by RICH1

It's obvious INFLATION is here but, how can Mr. Powell or anyone for that matter control it? It seems that the fundamentals have been ignored and consumers are creating their own problems! Will consumer demand for products decrease and prices start to fall? Didn't see this coming?

Inflation can be controlled by monetary and fiscal policy.The risk is causing a recession if policy is too tight. Also Janet Yellen is a dove on inflation and Powell misreads the economic signals. So, I forecast rising prices and possible stagflation.

[Blueblaze]

Anybody around here old enough to remember the Carter inflation?

Every night, there was some genius PhD guy on your TV, wringing his hands and acting like 20% inflation was just some kind of bad weather: "Nobody knows for sure where it comes from or what to do about it. Oh, there's lots of theories..."

And then Reagan came in and said, "Well, I'll be darned -- somebody left the magic money machine running over at the FED! Lemme just shut that stupid thing off, and things will get back to normal in no time!"

18 months later, it was over.

Funny thing, though. The genius PhD guys never did connect the dots between the Gooberment printing massive piles of money, and the money being worth less. So they invented "Modern Monetary Theory", which basically says the best way to guarantee government freebees for everyone is to crank up the magic money machine! Our last three genius FED chair-guys&gals have been big proponents of "MMT".

And son-of-a-gun, umpteen-trillion-dollars later, we've got inflation again! Whodathunkit!

As Churchill said, "Those who fail to learn from history are condemned to repeat it".

[Gpsma]

Those who dont know who said the original quote, shouldnt post it.

Now lets all remember..
Whip
Inflation
Now

[DAVES]

Originally Posted by Shadywood

Anybody around here old enough to remember the Carter inflation?

Every night, there was some genius PhD guy on your TV, wringing his hands and acting like 20% inflation was just some kind of bad weather: "Nobody knows for sure where it comes from or what to do about it. Oh, there's lots of theories..."

And then Reagan came in and said, "Well, I'll be darned -- somebody left the magic money machine running over at the FED! Lemme just shut that stupid thing off, and things will get back to normal in no time!"

18 months later, it was over.

Funny thing, though. The genius PhD guys never did connect the dots between the Gooberment printing massive piles of money, and the money being worth less. So they invented "Modern Monetary Theory", which basically says the best way to guarantee government freebees for everyone is to crank up the magic money machine! Our last three genius FED chair-guys&gals have been big proponents of "MMT".

And son-of-a-gun, umpteen-trillion-dollars later, we've got inflation again! Whodathunkit!

As Churchill said, "Those who fail to learn from history are condemned to repeat it".

As I regularly state, I am truly glad that I do not make the decisions. I do enjoy my right to complain with no consequences. Other than the consequences for what I decide to do with MY MONEY.

As far as history, we should all read about run away inflation in Germany in the 1930's
First of all Germany is what we tend to know, reality it was true of several countries including Spain among others.

The depression of the 1930s, no shortage of OPINIONS, but, it was caused by a clamp down on credit along with a tax increase.

I think all or most agree we are playing with fire. Solution, I don't know. Was I to post my solution no doubt, first of all I do not have the power to get it done and if I did many would argue that I am wrong.

Glad it is not my responsibility. History shows we will not do anything about it until we have to because it is so bad.

[CoachKandSportsguy]

Most of the time there is inflation. . very seldom is there deflation. . . the issue is how much and for how long which the OP didn't really address. . . Currently there is a calculation basis issue causing year over year inflation to calculate much higher due to the 3 months of deflation a year ago due to the economic shut down. However, if you look at the two year annualized inflation, its not up that much.

However, the sudden opening and the lack of employees is causing labor inflation which hasn't been seen in a long time. The reason for the lack of employees is NOT the unemployment checks, but a little more nuanced. First, there is not the availability for daycare for dual working families, so there are fewer employees available than prior to the pandemic as one has to take care of the kids. Secondly, the quantity of prime age employees in the US population is now shrinking. That is right, there are now less available employees available therefore there will be labor inflation as a battle for employees. I posted a Barry Ritholtz article that most people didn't believe, but there is more to employment than just the unemployment check size. But go ahead and believe the easy answer, its your right.

Working Age Population: Aged 15-64: All Persons for the United States (LFWA64TTUSM647S) | FRED | St. Louis Fed

There are other issues with very low inflation, such as companies can't increase prices, go for increasing volume, but that is much harder, and if volume can't be increased, then the only way to grow profits is to cut overhead costs, which is primarily corporate labor, thus more unemployment. . . and less maintenance and more automation as a fixed expense without inflation.

but its getting late. .

finance guy

[Timothyimitchell]

Inflation is here to stay. Too much spending and debt. Too many crooked politicians.The Fed has lost control. You= we will be fed money until it all goes boom. Watch!

[collie1228]

Politicians get re-elected by spending money (other people's money, of course) then bragging about "results". It was many years ago when I took Economics 101, but the concept of inflation hasn't changed. Printing money causes too many dollars chasing too few goods and services (demand outstrips supply), hence inflation occurs. Get used to it.

[davem4616]

we've lived with up and down inflation all our lives

just spend wisely...we're retired...it's time to enjoy life and stop worrying about what you can't control

you're not going to make a killing on your savings, so don't expect to....and having more than 30% in stocks is risky, as we're running out of runway to recover

I rarely watch the news anymore...can't do anything about it, and it seems that the people that should be able to do something
about it either don't seem to care or it's working in their favor....so why would I want to watch something that will just make my
blood boil

[DAVES]

Originally Posted by CoachKandSportsguy

Most of the time there is inflation. . very seldom is there deflation. . . the issue is how much and for how long which the OP didn't really address. . . Currently there is a calculation basis issue causing year over year inflation to calculate much higher due to the 3 months of deflation a year ago due to the economic shut down. However, if you look at the two year annualized inflation, its not up that much.

However, the sudden opening and the lack of employees is causing labor inflation which hasn't been seen in a long time. The reason for the lack of employees is NOT the unemployment checks, but a little more nuanced. First, there is not the availability for daycare for dual working families, so there are fewer employees available than prior to the pandemic as one has to take care of the kids. Secondly, the quantity of prime age employees in the US population is now shrinking. That is right, there are now less available employees available therefore there will be labor inflation as a battle for employees. I posted a Barry Ritholtz article that most people didn't believe, but there is more to employment than just the unemployment check size. But go ahead and believe the easy answer, its your right.

Working Age Population: Aged 15-64: All Persons for the United States (LFWA64TTUSM647S) | FRED | St. Louis Fed

There are other issues with very low inflation, such as companies can't increase prices, go for increasing volume, but that is much harder, and if volume can't be increased, then the only way to grow profits is to cut overhead costs, which is primarily corporate labor, thus more unemployment. . . and less maintenance and more automation as a fixed expense without inflation.

but its getting late. .

finance guy

Everyone of these posts, OPINIONS, are spun by selected facts.

Two old expressions-Figures don't lie but liars can figure. The other Figures don't lie but if you choke them hard enough you can make them say whatever you want.

The dollar has lost 6% of it's value this year. The CPI, consumer price index is up 5%.
We know today, we know the past, both are we should know SPUN,

In any case using the CPI of 5% in 14 years it will take over two dollars to buy what a dollar buys today. The ten year treasury is paying roughly 1.4%.

Inflation is good for debtors. Our government owes roughly 30 trillion dollars. I've freely admitted that I do not comprehend one Trillion let alone 30 of them. Few as they speak realize or face that truth. Devaluing the dollar by simply pulling them out of thin air. Does not ever in history end well. The dollar has lost 6% of it's value this year. The government, another term we the people, owe 30 TRILLION DOLLARS. As I said I do not comprehend
one trillion. Most if they think will realize they don't either. What is 6% of 30 Trillion?
My answer, really grand thief.

We do not control inflation, the un-elected FED does

[DAVES]

Originally Posted by davem4616

we've lived with up and down inflation all our lives

just spend wisely...we're retired...it's time to enjoy life and stop worrying about what you can't control

you're not going to make a killing on your savings, so don't expect to....and having more than 30% in stocks is risky, as we're running out of runway to recover

I rarely watch the news anymore...can't do anything about it, and it seems that the people that should be able to do something
about it either don't seem to care or it's working in their favor....so why would I want to watch something that will just make my
blood boil

I do understand your post but, it is not really possible.

Having 30% in stocks is risky. Actually having anything in stocks is risky. People refuse to see REALITY.

In days of old, not that long ago, the 10 year treasury paid the rate of inflation plus 2%.
Today the CPI consumer price index is 5%. Treasuries pay, last time I looked 1.4% and you pay Federal income tax on that 1.4%.

Panic tends to feed on itself. Reality, read the posts. People complaining about dog poo,
speeding golf carts and a neighbor with a lawn too brown or too many weeds or......

Things are pretty good, things never have been or will be perfect. Some of the posters, I wonder how they would deal with things if they turn bad.

I find it amusing to read OLD BOOKS. Global warming? I have book, that in my mind issimilar.
Predicting that, of course it has charts and graphs, that in ???? 10 years people would have horse droppings waist deep. Oil? There were similar books that people would run out of wood the principle fuel at the time.

The good old days-normal? The good old days were not as good as we remember. Normal was not normal and now is normal. Normal itself is always changing. Reality?
Reality is always SPUN.

[Ben Franklin]

Has anyone compared 2020 to 2021? No one was spending much in 2020, certainly not the paid slave class. The old rule was too many dollars chasing too few products, but this year I think it is the mark up of goods to offset last year's losses. And, as long as consumers decide to pay more than what something is really worth, we will have inflation. Take the housing market. It is the buyer who drives up prices, not the seller.
Solution, buy only what you need. Control your urge to spend, send, spend and inflation will come down, down, down.

Btw, the CSI Consumer Index rose 5 %, not just since 1-1- 2021, but from May -2020 to May-2021. Big difference.

CPI Home : U.S. Bureau of Labor Statistics

[sail33or]

Oil has gone from $42 to $72 a barrel. The cost of OIL is in everything. Nothing is made or transported without Oil in some way.

When you squeeze something or legislate against something it goes up in Value.

The interest rate on CD's is .005 percent. This is artificially keeping the Stock Market going using retirees money.

Just look at the jump in the price of houses in The Villages to see inflation going wild.

Oil/Natural Gas will continue to rise and there is going to be wailing and gnashing of teeth soon. We have not seen Inflation like what is on the way. All deserved and justified. Your house value might make you smile but when you drive to Walmart and it costs $100 to fill your tank and $500 grocery bill you are not going to last long.

What can you do? Buy Exxon Stock.

The Oil Man