Fed’s Dual Mandate Derby! Misery Index Hits All-time High (Flexible Price Core Inflation Losses At 21.82% Overwhelming Employment Gains)

Confounded Interest ^ | 04/13/2022 | Anthony B. Sanders

[Browns Ultra Fan]

The Federal Reserve’s two goals of price stability and maximum sustainable employment are known collectively as the “dual mandate.” Unfortunately, inflation is running away (bad) from employment gains (good). Sort of like “The Good, The Bad and The Ugly.” But just the Good and The Ugly combine to create the Misery Index.

Here is the Atlanta Fed’s CORE flexible CPI YoY for March. The good news? Flexible Core CPI YoY was a little lower than the historic high reading in February. The bad news? We are still talking about 21.82%+ rise in prices (down from 23.56% in February).

If I use the Atlanta Fed’s flexible consumer price CORE index combined with the U-3 unemployment rate, we see that March’s inflation report plus U-3 unemployment is generating a misery index that was last seen in July 2008 during The Great Recession. Unless we consider the July 2021 reading of 31.3%, so we have seen two horrible misery index readings under Biden.

If we look at the Misery Index since 1967, we now have the GOAT (Greatest of All-time) Misery.

Now, inflation under Presidents Ford and Carter (red line) were higher than the flexible core price index (blue line) in the 1970s and 1980. But flexible core price CPI YoY is substantially higher than March’s CPI growth of 8.5%.

The bottom line is that inflation losses are far outweighing the employment gains, resulting in elevated misery.

Misery. We are all feeling it.

[Browns Ultra Fan]

Frigging Biden and Green Democrats.

[brownsfan]

Apparently about 40% of America welcomes the misery.

[Crusher138]

Pre-COVID I would sell a white t-shirt with a digital print on the front and back for $6 at 100 pieces. Gross profit of about $400. About $250 net profit after labor, but before overhead expenses.

I just sold 100 shirts printed front and back for $9.50 each. Gross profit of about $550. Net profit after labor of about $250.

To make the same percentage of net profit, the price of the shirts would have to double.

This is the real inflation going on now. The effects are cumulative. The cost of materials, transportation and labor have all increased. Every move you take to catch up makes it worse.