Inflation

[divs4ever]

From around the traps:
View attachment 148476
....
Am trying to figure out the implications, because the movements are dramatic, to say the least.

not according to a Betashares analyst i listened to last night ,

.... unfortunately the markets haven't rallied enough to tempt me back into their inverse index products ,

now just because i l think several major economies are trash , doesn't stop such economies trying to 'spend their way out of trouble ' in another wave/tsunami of 'stimulus '

and of course since 'recession' is now an opinion of a select group of academics , the public might have to create a new slang word , for a sick economy ( so we don't offend the narrative )

 

[waterbottle]

From around the traps:
View attachment 148476
....
Am trying to figure out the implications, because the movements are dramatic, to say the least.

I thought central banker balance sheets were irrelevant - they can always print and swap?

 

[mullokintyre]

OZ nflation remains persistently high.
From The evil Murdoch Empire

Inflation has jumped to 7.3 per cent over the year to September, the highest since 1990, driven by accelerating prices for homebuilding, gas, and furniture and raising the chances of a more severe RBA response on Melbourne Cup day.

The Australian Bureau of Statistics data showed the change in the consumer price index over the quarter was 1.8 per cent, which lifted the annual pace from 6.1 per cent in June.

The consensus forecast among economists was for the annual pace of inflation to lift to 7 per cent.

Last night’s budget showed inflation reaching 7.75 per cent by the end of this year, before moderating to 5.75 by June next year, and then to 3.5 per cent by mid-2024.

The Reserve Bank also has consumer price growth peaking at 7.75 per cent by December, but today’s data raise the spectre that inflation is running still hotter than expected.

The RBA slowed its pace of rate hikes at its last meeting from half a percentage point to 0.25ppts, and analysts had expected another quarter-point move next Tuesday to 2.85 per cent.

The heroic assumptions in last nights budget will be looking like all the other treasury forecasts over the past few years, hopelessly wrong.
Will Lowe have the gonads to lift by another 50 basis points post cup day?
If they are serious about inflation reduction , they may have to.
Mick

 

[CityIndex]

Will Lowe have the gonads to lift by another 50 basis points post cup day?
If they are serious about inflation reduction , they may have to.
Mick

Might not be the worst thing in the world for the Aussie Dollar if the RBA reverts back to hiking rates by 50bps next week.

Although, even with today’s hotter-than-expected inflation print, AUD/USD continues to see selling pressure above 0.6400

 

[over9k]

AU inflation at 7.3%, 32 year high. Estimates were 7%.

Meanwhile, google reports earnings ~20% below estimates and futures plummet to -2% and counting.

Was anyone silly enough to buy yesterday?

 

[Knobby22]

From around the traps:


....
Am trying to figure out the implications, because the movements are dramatic, to say the least.

My guess is that the increased revenues are due to inflation effects on wages and consumption taxes combined with economically powerful firms increasing profits above inflation.

In which case, not highly relevant with regards to avoiding a recession as less powerful corporations will start to have smaller profits (lagged effect) and increasing unemployment.

 

[Knobby22]

Meanwhile, google reports earnings ~20% below estimates and futures plummet to -2% and counting.

Yes, not good

 

[waterbottle]

Australian CPI at 7.3%, above market expectations of 7.0%

 

[eskys]

Retailers taking a beating today....consumer staples

 

[bluekelah]

not according to a Betashares analyst i listened to last night ,

.... unfortunately the markets haven't rallied enough to tempt me back into their inverse index products ,

now just because i l think several major economies are trash , doesn't stop such economies trying to 'spend their way out of trouble ' in another wave/tsunami of 'stimulus '

and of course since 'recession' is now an opinion of a select group of academics , the public might have to create a new slang word , for a sick economy ( so we don't offend the narrative )

Yeah looks like 3q gdp numbers will be hugely positive above 2percent but could be just the final summer demand or some clever number tweaking pre-election. With every sector crumbling and usa now only having less than a month of diesel supply left, I don't think q4 will be pretty , 2023 could be the new 2008 the way fed is hiking.

Europe is a mess now, especially uk , might get another gilt crisis or contagion any day now, I don't think further printing can occur with usa raising rates all the way.

Could see CPI for Nov spike up as well. I think biden is trying to raid the SPR more after the pause in octber

 

[Value Collector]

From the WSJ


it looks suspiciously like a collapse in Imports.
Imports are one of the first casualties of a Recession.
How long before the R word starts to enter the financiers conversations.
Mick

It’s also just a sign of the covid induced spending on “things” rather than experiences ending.

The traffic jam at the port wasn’t a usual thing, it was only due to covid, so we may be heading for recession but either way that traffic was going to clear at some point regardless.

 

[Dona Ferentes]

. With every sector crumbling and usa now only having less than a month of diesel supply left, I don't think q4 will be pretty , 2023 could be the new 2008 the way fed is hiking.

Could see CPI for Nov spike up as well. I think biden is trying to raid the SPR more after the pause in octber

I read this elsewhere....

"Believe it or not I wanted to talk about diesel prices this week.

There is a growing diesel crisis as global inventory levels are at historically low levels.

Diesel is the lifeblood of the global economy and you can’t put a barrel of crude oil in a truck, a combine harvester, a barge, a ship, train or plane.

There is a chronic shortage of refining capacity, which is about to get much worse as the EU ban on Russian diesel exports comes into effect next February.

Furthermore, much of the world’s refining capacity is in the hands of countries that are no longer our friends.

I have written about this before and I will, unfortunately, return to this topic many times in the year ahead.

Before I do…WAKE UP AUSTRALIA, WE IMPORT 90% OF OUR FUEL!

Yes, I know using capital letters is the equivalent of shouting.... "

......................................................
And the Strategic Petroleum Reserve - from another opinion piece

"Last Wednesday, President Joe Biden announced the release of 15 million more barrels from the reserve in December, completing a plan he laid out earlier to release a total of 180 million barrels in an effort to keep gasoline prices at the pump as low as possible – in advance of the midterm elections.
"According to a report in The Washington Post, the reserve contained “405.1 million barrels as of October 14. That’s about 57 per cent of its maximum authorised storage capacity of 714 million barrels.”
"I sympathise with the president. People were really hurting from $US5 ($7.8) and $US6-a-gallon gasoline. But using the reserve – which was designed to cushion America in the face of a sudden shut-off in domestic or global production – to shave a dime or a quarter off a gallon of gasoline before elections is a dicey business, even if the president has a plan for refilling it in the coming months.....

......................................
but there again, Europe is doing better than many thought

 

[divs4ever]

I thought central banker balance sheets were irrelevant - they can always print and swap?

that is a narrative that i have heard some ( CB ) bankers say however some ( CB ) bankers have a different tale and sometimes even act , like debt growth matters , from time to time

 

[divs4ever]

I read this elsewhere....

"Believe it or not I wanted to talk about diesel prices this week.

There is a growing diesel crisis as global inventory levels are at historically low levels.

Diesel is the lifeblood of the global economy and you can’t put a barrel of crude oil in a truck, a combine harvester, a barge, a ship, train or plane.

There is a chronic shortage of refining capacity, which is about to get much worse as the EU ban on Russian diesel exports comes into effect next February.

Furthermore, much of the world’s refining capacity is in the hands of countries that are no longer our friends.

I have written about this before and I will, unfortunately, return to this topic many times in the year ahead.

Before I do…WAKE UP AUSTRALIA, WE IMPORT 90% OF OUR FUEL!

Yes, I know using capital letters is the equivalent of shouting.... "

......................................................
And the Strategic Petroleum Reserve - from another opinion piece

"Last Wednesday, President Joe Biden announced the release of 15 million more barrels from the reserve in December, completing a plan he laid out earlier to release a total of 180 million barrels in an effort to keep gasoline prices at the pump as low as possible – in advance of the midterm elections.
"According to a report in The Washington Post, the reserve contained “405.1 million barrels as of October 14. That’s about 57 per cent of its maximum authorised storage capacity of 714 million barrels.”
"I sympathise with the president. People were really hurting from $US5 ($7.8) and $US6-a-gallon gasoline. But using the reserve – which was designed to cushion America in the face of a sudden shut-off in domestic or global production – to shave a dime or a quarter off a gallon of gasoline before elections is a dicey business, even if the president has a plan for refilling it in the coming months.....

......................................
but there again, Europe is doing better than many thought
View attachment 148492

if it wakes a couple extra up , i forgive you ( for 'shouting ' )

yes Australian refinery capacity concerns me as well , you would think we would refine 100% of our national needs , even if just to keep up to date technologically ( and not going down the 'carbon footprint ' path )

 

[divs4ever]

OZ nflation remains persistently high.
From The evil Murdoch Empire

The heroic assumptions in last nights budget will be looking like all the other treasury forecasts over the past few years, hopelessly wrong.
Will Lowe have the gonads to lift by another 50 basis points post cup day?
If they are serious about inflation reduction , they may have to.
Mick

history suggests there will be no change on Cup Day , but is it different this time and the RBA NEEDS , to keep chasing the CPI number

now from my understanding of the Volker move , the official rate has to be IN FRONT of ( higher than ) CPI

but here we are with ( many) Central banks trailing behind timidly even when using watered down CPI calculations
i guess we are in for a lesson in fiscal policy ( we still LEARN from bad outcomes , don't we , or are they now 'memory-holed )

 

[waterbottle]

Bank of Canada doing a Phil Lowe, has gone for 50bps instead of 75bps.
Meanwhile Facebook shits the bed, down 16% after hours

 

[waterbottle]

Bank of Canada doing a Phil Lowe, has gone for 50bps instead of 75bps.
Meanwhile Facebook shits the bed, down 16% after hours

Down 23%....
Wow.
Is this what happened during the tech crash?

 

[divs4ever]

if you mean the 'dot.com' bubble i wasn't even remotely interested in the stock market back then ( and just starting a hobby in computers focusing on the hardware side )

but back in those years some folks had a term for software that did nothing important 'vaporware'

given Meta and friends are heavily into Cancel-Culture , is this vaporware 2.0 ( as independent thinkers restructure their life without social media )

 

[CityIndex]

Bank of Canada doing a Phil Lowe, has gone for 50bps instead of 75bps

Seemed to help boost bets even further on the Fed possibly also pivoting come December.

The ECB’s interest rate decision is due tonight, and they are expected to stick with 75bps. Should be interesting to see how the outcome of this meeting impacts speculation regarding the Fed’s policy plans.

 

[qldfrog]

Down 23%....
Wow.
Is this what happened during the tech crash?

While i value google technically, FB is utter crap, technically..and i do not give my thoughts about the actual SM concept or aims.
They deserve to be replaced.WeChat is was light ahead..but sane crap .just a propaganda tool.
So now what will happen to Amazon and Google SP deserves scrutiny.
And if inflation is above 10% and your results are increasing anywhere below, are you not going backward already..
I know you have to weight the spread of profits along the year but you catch the idea?