Posted on 03/14/2022 4:08:03 AM PDT by MtnClimber
Mohamed El-Erian, the chief economic adviser for Allianz, got the inflation problem correct; states a forecast in line with CTH Main Street review, but then falls short on his political outlook for the solution.
Within the interview, El-Erian predicts inflation at the current CPI measure will increase from current 7.9% to over 10% this year. That aspect is in alignment with CTH review at ground level.
Current real inflation is more than 15% across the board, if you use the CPI methodology we were using in the 70’s and 80’s. Both the scale and the speed of the current price increases are historic. That is why you are seeing prices on retail items jumping so high, so fast. The price increases on highly consumable goods are in the 15 to 20% range. WATCH:
An increase to over 10%, using current CPI measures, equals an increase of 25 to 30% in actual price (using historic measures). Keep in mind, we have already passed through a wave of backward-looking inflation in the 25 to 30% range. El-Erian is predicting a duplication of that scale into the remainder of 2022, I agree. The 2020 $3 item became the 2021 $4 item, which will now become the 2022 $5.50 item. That is our reality. It will not get better.
Where we differ from El-Erian is on the wage side and the political analysis. Any political intervention to create govt subsidy with the goal to generate a higher workforce will backfire – bigly. Recent historic employment statistics have not yet reflected the demand side decline in goods. The employment data is skewed and useless because of the COVID mitigation impact on jobs.
(Excerpt) Read more at theconservativetreehouse.com ...
Let’s Go Brandon!
But but but, I thought it was greedy businesses that caused inflation. s/
No wonder congress gave itself a 21% raise. That must be the true rate of inflation expected.
Gosh. If only those evil businesses were to “lower their costs” this whole problem would go away.
A lot of things have gone up due to more expensive energy costs.
Major exceptions include stuff for houses and rents. The deadbeat tenants hopefully will be made to pay their fair share again (so honest tenants don’t have to pay for what deadbeats won’t) and hopefully housing component greed will meet its match in affordability reality.
Hopefully the auto industry will get its supply bottlenecks resolved.
Everything I buy has gone up 30%+ over the past 12 months. And, with Congress giving itself a big pay raise, this inflation amounts to nothing less than a transfer of $$ from my pocket to the pockets of the Deep State.
Oil trading at 102 this morning, down quite a bit from it’s spike high of 130.
One would think with insider trading allowed they wouldn’t need the base bump...
Keep printing that money.
That may be a problem....China has announced shutting down Shenzhen port, which is their big tech hub.
“The high-tech city of Shenzhen is the latest Chinese city to be shut down. It has a population of over 17 million. The decision has been taken by the government to contain the worst outbreak of virus cases in the last two years.”
Right now they’re saying it’s only for a week. But who knows?
Can’t lay all of the blame on Brandon. The Republicans who voted for all of the bailout contributed too... and there are many.
glad I bought my house a few years ago
Some auto dealers are charging 30% over MSRP for certain models.
If a government spends more than its revenue, and finances it by creating more money, or having its central bank do the deed, you have inflation, whether it’s Weimar Germany, Zimbabwe, or Biden’s USA. Period! It’s that simple.
They don’t need to print the money anymore. All it takes is a couple of keystrokes on the Fed’s computer.
Thank you Captain Obvious!
Inflation is easily 10% already.
We will be lucky if it does not hit 15%.
People have no idea that the price of diesel fuel affects everything. Seventy percent of the freight is moved by over the road trucks. The other 30% is moved by a combination of trucks, railroads and ships. ALL of those vehicles primarily run off of diesel fuel.
The vessel bringing the containers of produce from Chile this time of year runs on diesel. The train engine is a diesel electric engine. The Kenworth tractor pulling the reefer van burns diesel.
EVEN IF we replaced every passenger car burning gasoline. We would still need diesel to run our major logistics.
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