• Security incident: ISF was recently accessed by intruders. Please change your password, and change it anywhere else you used it. Read more

Inflation

The Atheist said:
I came here specifically to drop that tidbit if nobody else had.

My expectation is the inflation will be hidden by shrinkflation wherever possible, and actual price increases blamed on Biden.

The proles may need an extra Two Minute Hate to get over it.
Click to expand...
Sounds about right.

Also expect that if and when the rate of inflation starts to drop it'll be pitched as a reduction in prices as opposed to a drop in the rate at which prices are rising.
 
It's Baaaaaaacccckkk!

Inflation surged to 3.8% in April, its highest level in nearly three years, according to data released Tuesday, as the war in Iran causes a ripple effect across the economy and energy prices surge.
Click to expand...
 
Brainster said:
It's Baaaaaaacccckkk!
Click to expand...
This is only temporary. Iran is desperate for a deal so the Strait of Hormuz will be open by next Tuesday. Then gas prices will instantly go down by 50%, just like Trump promised in his 2024 election campaign.

Interior secretary Doug Burgam says the US right now is the most energy secure, most energy affordable nation in the world, and President Trump's playing a geopolitical game which includes Venezuela stopping China from buying cheap Venezuelan Iranian oil. The work that he's doing to build a coalition around the world, whether it's opening the Strait or on critical minerals. Heading into the summit this week, President Trump's in the strongest position of any US leader ever going into a discussion with China. You take a look at the economic numbers and and the US economy is strong China's economy is faltering. It's just a great spot and President Trump's leadership is putting us in a great place to come out on top!

So please stop whining about what you have to pay for stuff right now. Can't you see that President Trump's Making America Great Again in all the ways that matter?
 
Inflation is obviously surging everywhere, with various means of dealing with it.

Aussie has taken a bold move in their budget, giving money to low-income earners, while locking in rate increases and NZ's government has it's fingers in its ears singing lalalala as loud as it can.
 
Hmm, the bond market worldwide is ringing bells right now, with multi-year or -decade highs around the world.

www.abc.net.au

Once-in-a-generation Australian bond sell-off is 'bad news' for everyone

The yield of the Australian government's 10-year bond has climbed to a 15-year high, in a worrying sign for Australian borrowers.
www.abc.net.au www.abc.net.au

That is guaranteed to do two things:

Raise prices in general as working capital costs will be higher.
Increase mortgage and all lending rates, also increasing costs, but in the longer term, locking in inflationary pressure for at least a year.

Given the very high debt levels everywhere, this is going to start hurting very quickly. In the GFC, rates were near zero to provide impetus for growth, which isn't an option now, as nobody is going to by US T-bills at 1% when inflation is 4-5%.

Very interesting period ahead. I'm going to take a small short position on the Dow - expected returns over 10% look very unlikely about now.
 
The Atheist said:
Very interesting period ahead. I'm going to take a small short position on the Dow - expected returns over 10% look very unlikely about now.
Click to expand...

I threw a grand at VIX at $15.20 and it's hovering around $17.80 right now, so 15% for a week looks ok.

I think I'll double up.
 
Is Modern Money Theory dead?

France's Leading Presidential Candidate Wants To Cancel Massive National Debt

“Why did we make a single currency and an ECB together? We can do it and I bet we’d find allies in Europe.”

In fact, France's public debt now tops 116% of GDP, which is worse than the U.S. ratio of roughly 100% when measured by publicly held debt. Meanwhile, France's economy has been mired in low economic growth in recent years, while the AI boom is turbocharging America's GDP. But far-left presidential candidate Jean-Luc Melenchon is campaigning on a plan to have the central bank simply cancel its holdings of French debt.

With a lighter debt burden, in his view, the French government could then spend more on social programs. The message is proving to be popular with voters, and polls indicate Melenchon is headed for a runoff with far-right leader Marine Le Pen in next year's presidential election.

"All we have to do is take the 18% held by the Bank of France and chuck it in the fire," Melenchon has said. France's own prime minister has warned that reneging on the national debt would force the country to borrow at exorbitant interest rates, just as the government must turn to the bond market to raise more than $360 billion this year.
Click to expand...


I always wondered about the Inflation Imperative. Why would anyone want hyperinflation? Well, I got my answer.

I think people prefer inflation to taxes. A five percent across the board tax on France's four trillion dollar would bring in 200 billion and put them back on track, for slow and regular inflation of MMT. The same thing happened in Argentina, they even went through Javier Milei cuts to programs getting inflation down to fifty percent rather than raise a five percent tax on the general economy. In the United States such a tax would largely fix the deficit problem and bring down inflation. But no...

Looks like we enter a new era of hyperinflation.
 
Solitaire said:
Is Modern Money Theory dead?




I always wondered about the Inflation Imperative. Why would anyone want hyperinflation?
Click to expand...
For some sellers, it means open season to gouge pricing and throw up your hands saying "inflation, man. Whatta ya gonna do?"

The French roast coffee I bought at my supermarket was $9.99 for a two pound bag of whole beans in the years preceding COVID, and went on sale for $5.99 every couple weeks like clockwork. It is currently $20.99 and haven't seen it on sale for a few years now.

I emailed the retailer inquiring about this, asking if they were paying more because of fair trade increases to bean growers (which I'd be fine with). No, they said- just general inflation costs. There was no inflationary or other cost to drive the price up effectively over 300%. They might have suffered a spike due to shipping issues early on, but those days are pretty much behind us. They are jacking because they can.
 
"All we have to do is take the 18% held by the Bank of France and chuck it in the fire," Melenchon has said.
Click to expand...
Unless the Bank of France is fully privately owned, Melenchon is almost as stupid as Trump.

Even in the US, the government effectively pays no interest on bonds held by the Fed because all Fed profits get returned to the Treasury.
 
Thermal said:
For some sellers, it means open season to gouge pricing and throw up your hands saying "inflation, man. Whatta ya gonna do?"

The French roast coffee I bought at my supermarket was $9.99 for a two pound bag of whole beans in the years preceding COVID, and went on sale for $5.99 every couple weeks like clockwork. It is currently $20.99 and haven't seen it on sale for a few years now.

I emailed the retailer inquiring about this, asking if they were paying more because of fair trade increases to bean growers (which I'd be fine with). No, they said- just general inflation costs. There was no inflationary or other cost to drive the price up effectively over 300%. They might have suffered a spike due to shipping issues early on, but those days are pretty much behind us. They are jacking because they can.
Click to expand...
Here in a coffee-growing part of Colombia a local dark roast retail price is just under $13 USD for half a kilo. Excellent coffee (100% Arábica) is grown here, it's everywhere.

The USD has declined about 25% against the Colombian peso since January of 2025 thanks to the carry trade the Colombian currency has been experiencing. January of 2025 that same half a kilo would have cost approx $9.50 USD retail here.
 
Last edited:
You must log in or register to reply here.

Share this page

ISF - Join now!

Every member here is approved by hand. No bots, no spam, just people who care about evidence and honest debate.

Membership is free!

Create your free account

Back
Top Bottom