CPI jumps 5% in May of 2021, fastest since 2008

[Swordsmyth]

Inflation Cooling, But Still Hot In Some States

https://www.thefinancialtrends.com/2...n-some-states/

[oyarde]

Ya , inflation isnt really cooling .When you have to remove 12 percent food inflation to get to around 6 1/2 that isnt good .

[oyarde]

Also it should be time to revise down 4th qtr gdp but it was probably lower than the revision will be.

[Swordsmyth]

US Inflation Accelerated Again In January

https://www.thefinancialtrends.com/2...in-in-january/

[oyarde]

Pending home sales up 8.1 percent in Jan , largest increase since June 2020.

[oyarde]

manufacturing declining for fourth straight month, still too many worthless frn's going to be chasing too few goods bringing inflation.interest rates are going to be moving up , should slow housing but no sign of slowing anything else at this time .

[oyarde]

US personal debt up 8 percent from Third qurter 2021 , Credit card debt up 14 percent from 2021 to 2022 and rising . Inflation still chooglin'

[Krugminator2]

High Inflation Will End Soon

But the Fed’s change in course heightens the risk of recession.

We predicted two years ago that inflation would be persistent and rise to the highest levels in a generation. We were right when others weren’t because we based our forecast on the quantity theory of money, which links asset prices, economic activity and inflation to changes in the money supply. Despite this week’s increase in monthly inflation, we now think inflation is knocking on death’s door and a recession may be on the way.

The dramatic change in our predictions is due to the Fed’s dramatic change in behavior. In March 2020, the central bank embarked on large-scale asset purchases, which immediately and dramatically accelerated broad money growth. In May 2020, the three-month annualized growth rate of the money supply, as measured by M2, reached 77.2%. By March 2022, M2 had increased by an unprecedented cumulative 41%. Even during the inflation crises of 1973-75 and 1980-82, the increase in money growth didn’t approach what occurred in 2020-21.
Inflation usually lags sustained changes in the money supply by 12 to 24 months. Sure enough, by April 2021, headline inflation had increased to 4.2% from 1.5% in March 2020. By March 2022, it was 8.5%.
Given these data, we extended our forecast in the summer of 2022, writing that year-over-year inflation would end 2022 at 6% to 8% and would fall to 5% by the end of 2023. Excess money balances, which resulted from unbridled money growth in 2020-21, were some 20% greater in the second quarter of 2022 than the multidecade trend line for M2. We assumed that households and firms would spend these excess balances gradually until they hit “normal,” or on trend, and so inflation would persist.

Instead, the Fed reversed course sharply and households and businesses quickly shed excess money. M2 peaked at $21,739.7 billion in March 2022, and since then has declined to $21,207.4 billion. In the past nine months, M2 has declined at an annualized rate of 3.2%. This flip from expansion to contraction is the steepest adjustment in money-supply growth in postwar U.S. history. Based on 2022’s fourth-quarter data, the excess money balances have already declined to only 11.8% greater than normal and that slight bump could dissipate entirely by mid-2023. In other words, we’re almost out of the inflation woods.

https://www.wsj.com/articles/high-in...9a30?mod=e2two

[Madison320]

https://www.wsj.com/articles/high-in...9a30?mod=e2two

Yeah, but the fed's balance sheet drives m2.

I looked up the fed's balance sheet vs m2 since 1960.

Interestingly it was almost impossible to get the balance sheet before 2008 but I finally found it.

Excuse the spacing

balance M2 ratio
1960 53 298 5.622641509
1970 81 589 7.271604938
1980 158 1482 9.379746835
1990 310 3166 10.21290323
2000 669 4666 6.974588939
2010 2346 8458 3.605285592
2020 4149 15401 3.71197879
2023 8507 21267 2.499941225

M2 was on average 8 times as high as the balance sheet from 1960 to 2000 (before QE).

Now M2 is only 2.5 as high as the balance sheet.

That means that M2 has to triple to catch up to the balance sheet.

Therefore prices have a long way to go before they catch up to the fed's balance sheet and M2.

If you're right that M2 is the best predictor of prices then prices will eventually triple.

[oyarde]

no real way to predict now , never before has there been so much cash sitting around with the wealthy while at the same time the median income guy is spending every dime he gets. no savings , just debt putting them in an awful position to weather a downturn.personally i dont see a good long term outcome for the american monetary system. if you think a frn is worthless now just imagine in another decade.

[oyarde]

at this point it is kind of hard to believe the fed is still babbling about 2 percent inflation, i mean lets get serious about expectations , how bad would things have to be to get to that ? the govt could help by reducing regulation that stifles gdp but we also know that cant be expected .

[Madison320]

So I just heard on the Peter Schiff show that the federal reserve lost over 100 billion in february. That has to be paid by the us treasury. Where are they going to get the money? Eventually from the federal reserve when they have to start printing again. What a house of cards.

Apparently this is the first time the fed has operated at a loss since 1915.

They're losing almost 40 billion a week.

https://fred.stlouisfed.org/series/RESPPLLOPNWW

[oyarde]

31 percent of new cars sold last month sold for more than sticker price . Chooglin'

[oyarde]

Once they strip out the third world double digit food inflation probably still be at three times the fed fantasy target

[alina.zzz]

All gonna be good.

[oyarde]

inflation in UK 10.4 percent , here Fed signals they have surrendered to the inflation they created and are signaling last 1/4 point hike is it.

[Krugminator2]

"

US monetary policy has become too TIGHT – the Fed risks significantly UNDERSHOOTING it’s 2% inflation target"

It is therefore time for the Fed to acknowledge that monetary conditions have become too tight.
Another very important message is that the Fed should not become preoccupied with the distress in the banking sector. Rather, the Fed should do its job on monetary policy, and that job is to ensure nominal stability. If the Fed is doing that job well, then financial stability is automatically ensured as well.
I also believe that this means that it is now most likely that the Fed will not hike its key policy rate at its upcoming FOMC meeting later this week. In fact, it is likely advisable to cut rates right now. That said, I would much rather that the Fed communicated a proper nominal GDP level target of 4 percent.
Unfortunately, the Fed failed massively on the overly easy side in 2021-22, so it is now impossible to bring back NGDP to its pre-2020 4 percent trend without a massive US recession and global financial crisis.

The Two Year Treasury is at 3.825% and the Fed Funds rate is 4.57%. https://marketmonetarist.com/2023/03...lation-target/

[oyarde]

Ya , doubtful we see 4 percent gdp. The govt has killed gdp , they could bring some back with massive deregulation but they wont in fact they will regulate more.

[Krugminator2]

Ya , doubtful we see 4 percent gdp. The govt has killed gdp , they could bring some back with massive deregulation but they wont in fact they will regulate more.

He's talking about nominal GDP, not real, which had been running over 10%. It has dropped to around 7%. He's saying the ideal would be to make 4% nominal as the target. Would keep inflation low and have macroeconomic stability.

[Krugminator2]

Smart person talking about monetary policy.

Also

[oyarde]

With trump indictment he will surge to largest leads ever over desantis . Opening the way again for dem mail in victory since nothing substantial has changed . Should be some upside to gold , silver needs about a twenty percent increase in investors to move up into more realistic territory of course one more bank could do it . APMEX sold over 100 million in bullion the week following first bank failure. Inflation could remain fairly stable rest of yr , wouldnt expect much in the way of GDP , fed probably stops where it is. Seeing no upside to FRN's , energy prices likely to keep rising in future. Still an increbible amount of lower value FRNs sitting around out there doing nothing . Local coin shop 40 percent increase in sales in sixty days , Feb 01 trough Apr 01 over last years sixty day avg.

[Swordsmyth]

McDonalds Tells Corporate Staff To Stay Home This Week, And Watch Out For Layoff Emails

https://www.thefinancialtrends.com/2...layoff-emails/

[Swordsmyth]

WTO Sees Food Prices At Risk Of Massive Spikes

https://www.thefinancialtrends.com/2...assive-spikes/

[Swordsmyth]

Inflation Moderates In March

https://www.thefinancialtrends.com/2...ates-in-march/

[Swordsmyth]

Oil May See A 2 Million Barrel Per Day Supply Shock

https://www.thefinancialtrends.com/2...-supply-shock/

[Swordsmyth]

Food Costs In America Continue To Rise

https://www.thefinancialtrends.com/2...tinue-to-rise/


IEA Warns Over OPEC+ Cuts

https://www.thefinancialtrends.com/2...ver-opec-cuts/


In Argentina, Inflation Continues To Soar

https://www.thefinancialtrends.com/2...inues-to-soar/

[oyarde]

Ya the food inflation cant be stopped . Eating out up 9 1/2 percent , groceries up 8 1/2 percent. Costs of living in the third world with a $#@! currency. The working poor will have another tough winter coming

[Swordsmyth]

World May Face A Rice Shortage

https://www.thefinancialtrends.com/2...rice-shortage/


Argentina Raises Benchmark Rate To 81% As Inflation Roars

https://www.thefinancialtrends.com/2...flation-roars/

[Swordsmyth]

Japanese Inflation Passes 40 Year High

https://www.thefinancialtrends.com/2...-40-year-high/

[oyarde]

Two of the tings that allowed even lower income Americans enjoy a higher standard of living in the recent past was cheap energy and the fact that they needed to spend much less of a percentage of income on food than other third world countries . Those advantages have began to evaporate quickly . Dont look for them to come back at this point.