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Inflation

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Why inflation is hurting ordinary Australians so much.

This analysis of where the biggest Cost of living increases have occurred highlights the particular impact on the day to day lives of normal people (ie those not on 200k packages) . Certainly makes a lie of the 7% inflation figure

Interest rate rises, which are not included in CPI figures, are at the top of the list. The rest looks like this

Around a fifth of the sub-categories of goods and services monitored by the ABS in its CPI have risen by double-digits over the year to September. These are the top 10 price jumps:
  • International travel: +25.3 per cent
  • New dwelling purchase: +20.7 per cent
  • Cooking oils and fats: +19.3 per cent
  • Automotive fuel: +18 per cent
  • Veggies: +17.2 per cent
  • Gas: +16.6 per cent
  • Milk: +16.2 per cent
  • Non-durable household products: +16.2 per cent
  • Fruit: +14.6 per cent
  • Pets and related products: +13.8 per cent.
Source: ABS, CPI, September quarter 2022

Electricity prices would have made this list, rising 15.6 per cent in the September quarter alone, but for government subsidies and rebates in some states that kept this price increase down to 3.2 per cent. There will be pay-back in next quarter's figures

www.abc.net.au

Here's what went up the most in price over the past year. It's grim reading for many home owners

Millions of Australians who are struggling with soaring inflation rates suffer another increase in the fastest-rising cost of living — interest rates — with the RBA lifting them again on Melbourne Cup Day.
www.abc.net.au www.abc.net.au
 
moXJO said:
There's a coalition of commodity heavy countries that want to move away from the usd$. To something that doesn't depreciate as hard.
Saudis chattering about something gold backed. Might be all pie in the sky stuff, but I'm definitely seeing moves.

What's the safest (ie. lazy man's option) of shorting the usd out to 2024 if I were interested. Which I'm not really because I'm in a pretty lazy mood.
Click to expand...
The Saudis get a lot more relevance debate than they deserve.
Apart from oil, sand and terrorism, they don't make , export , or grow much else.
nearly 70 % of its economy and 65% of its exports are fossil fuel based.
The most critical source of revenue, apart from its hit squads, will come to an end, either by the rest of the world removing its great dependance on oil, or, more likely, the reserves of oil along with the technology to extract it will run dry.
So what do they have to offer the rest of the world apart from a steady market for red checked tea towels and fan belts?
The population of 35 million people is mostly poorer immigrants who work to make life easier for the House of Saud elites.
It lacks water, is unable to feed itself, and relies on buying large tracts of arable land in other countries.
A corrupt , mysoginist , narcissistic regime that lacks any sort of morals or ethics most likely will not survive the next 30 years.
mick
 
mullokintyre said:
The Saudis get a lot more relevance debate than they deserve.
Apart from oil, sand and terrorism, they don't make , export , or grow much else.
nearly 70 % of its economy and 65% of its exports are fossil fuel based.
The most critical source of revenue, apart from its hit squads, will come to an end, either by the rest of the world removing its great dependance on oil, or, more likely, the reserves of oil along with the technology to extract it will run dry.
So what do they have to offer the rest of the world apart from a steady market for red checked tea towels and fan belts?
The population of 35 million people is mostly poorer immigrants who work to make life easier for the House of Saud elites.
It lacks water, is unable to feed itself, and relies on buying large tracts of arable land in other countries.
A corrupt , mysoginist , narcissistic regime that lacks any sort of morals or ethics most likely will not survive the next 30 years.
mick
Click to expand...
Sorry, I replied to the wrong post re Saudis.
Should have been post #2696.
Mick
 
75842B8E-1BC4-4983-AAD1-3E9F4358695A.jpegDXY chart set to 25 years. Last time the US dollar was this high was in 2002, $1.20. The US dollar soon collapsed.
073C9959-FD7E-4E66-835A-373943F2454B.jpeg
Gold chart also set for 25 years. Gold rallied from 2002 through to 2011. $250 in 2002 to $1800 in October 2011
 
mullokintyre said:
The Saudis get a lot more relevance debate than they deserve.
Apart from oil, sand and terrorism, they don't make , export , or grow much else.
nearly 70 % of its economy and 65% of its exports are fossil fuel based.
The most critical source of revenue, apart from its hit squads, will come to an end, either by the rest of the world removing its great dependance on oil, or, more likely, the reserves of oil along with the technology to extract it will run dry.
So what do they have to offer the rest of the world apart from a steady market for red checked tea towels and fan belts?
The population of 35 million people is mostly poorer immigrants who work to make life easier for the House of Saud elites.
It lacks water, is unable to feed itself, and relies on buying large tracts of arable land in other countries.
A corrupt , mysoginist , narcissistic regime that lacks any sort of morals or ethics most likely will not survive the next 30 years.
mick
Click to expand...
Petrodollars.
 
mullokintyre said:
Sorry, that one went through to the keeper.
Would you care to expand a little Mox??
Mick
Click to expand...
Once the US went off the gold standard they cut a deal with the Saudis to basically oil back the $usd to keep it as reserve currency in exchange the US defends the regime.

Or something like that.

Anyway if Saudis pivot to something else $Usd is probably toast
 
moXJO said:
Once the US went off the gold standard they cut a deal with the Saudis to basically oil back the $usd to keep it as reserve currency in exchange the US defends the regime.

Or something like that.

Anyway if Saudis pivot to something else $Usd is probably toast
Click to expand...
I bet the Saudis are not getting petrodollars for Chinese oil sales.
Mick
 
mullokintyre said:
I bet the Saudis are not getting petrodollars for Chinese oil sales.
Mick
Click to expand...
That's part of the problem. They started selling it in yuan earlier this year. While it's largely "symbolic" there's that concern.
BRIC was obviously wanting to ditch the $USD. They are not the only ones.

Saudis have that new (fairly aggressive in his moves) prince. He seems very open to the new world.

Like I said all pie in the sky stuff right now. But everything seems to be lining up that way. No idea how long that shift takes to happen either
 
Guys if the world goes to **** the USD will be the flight to safety. The only exception is if the U.S itself goes to hell and the usa is actually going to be the best country for the rest of this half of the century.
 
over9k said:
Guys if the world goes to **** the USD will be the flight to safety. The only exception is if the U.S itself goes to hell and the usa is actually going to be the best country for the rest of this half of the century.
Click to expand...
Chuck butler in his overnight email noted a couple of important things.

1. The Chinese Renmimbi has become the fifth most traded currency.
I was one of those saying that the Renmimbi/Yuan did not have enough liquidity to become a major force.
That might be true in the western world, but it is patently obvious that other countries see no such problems. This is a major level of scale that many experts said could not be achieved.

2. Last Friday, stats announcing that Consumer Spending had risen3.8%, and the economy was seen as being resilient . The problem is, the high levels of inflation would have taken account of a goodly chunk of that rise, so its really a small rise in real value at best.

3.the current Debt to GDP at a worldwide level is sitting at 350%! The use looks comparatively benign at a mere 140% of GDP.
In 1985, the then relevant nations gathered at the Plaza hotel in New York city. They collectively decided that US current account deficit/ GDP ratio at 2.5% was far too high and the rest of the world would sell US dollars. Conveniently, the Fed government no longer report it. But others do.According to BEA, the us current account deficit 3.6% up from 2.9 % in 2020. If 2.5% was too much for the finance ministers in 1985, what would they think of todays 3.6%??

4. There is a bit of a liquidty crunch happening in US treasuries.
Japan has pulled back from buying US treasuries as it seeks to prop up the Yen.
The US fed has been shrinking its balance sheet of US treasuries, so not only is it not buying , its a net seller.
Other potential Buyers, China, Russia, the OPEC middle eastern countries have vowed to move out of the USD.
Personally, I see major problems for the USD and the US economy.
Mick
 
moXJO said:
I think fed will possibly pivot towards the end of the year.
I don't think 2-3% inflation will be the baseline they will be able to get to.

Hard to see how they get out of this one. Especially with Republican possibly blocking everything.
Click to expand...

Just to add, there are already talks of redefining target inflation to 3%. Shifting he goalposts makes the job easier....

mullokintyre said:
Chuck butler in his overnight email noted a couple of important things.

1. The Chinese Renmimbi has become the fifth most traded currency.
I was one of those saying that the Renmimbi/Yuan did not have enough liquidity to become a major force.
That might be true in the western world, but it is patently obvious that other countries see no such problems. This is a major level of scale that many experts said could not be achieved.

2. Last Friday, stats announcing that Consumer Spending had risen3.8%, and the economy was seen as being resilient . The problem is, the high levels of inflation would have taken account of a goodly chunk of that rise, so its really a small rise in real value at best.

3.the current Debt to GDP at a worldwide level is sitting at 350%! The use looks comparatively benign at a mere 140% of GDP.
In 1985, the then relevant nations gathered at the Plaza hotel in New York city. They collectively decided that US current account deficit/ GDP ratio at 2.5% was far too high and the rest of the world would sell US dollars. Conveniently, the Fed government no longer report it. But others do.According to BEA, the us current account deficit 3.6% up from 2.9 % in 2020. If 2.5% was too much for the finance ministers in 1985, what would they think of todays 3.6%??

4. There is a bit of a liquidty crunch happening in US treasuries.
Japan has pulled back from buying US treasuries as it seeks to prop up the Yen.
The US fed has been shrinking its balance sheet of US treasuries, so not only is it not buying , its a net seller.
Other potential Buyers, China, Russia, the OPEC middle eastern countries have vowed to move out of the USD.
Personally, I see major problems for the USD and the US economy.
Mick
Click to expand...

Janet Yellen is aware of the treasury liquidity issue. They had plans to buy short term bonds. Not sure what's happened to that.
 
mullokintyre said:
Chuck butler in his overnight email noted a couple of important things.

1. The Chinese Renmimbi has become the fifth most traded currency.
I was one of those saying that the Renmimbi/Yuan did not have enough liquidity to become a major force.
That might be true in the western world, but it is patently obvious that other countries see no such problems. This is a major level of scale that many experts said could not be achieved.

2. Last Friday, stats announcing that Consumer Spending had risen3.8%, and the economy was seen as being resilient . The problem is, the high levels of inflation would have taken account of a goodly chunk of that rise, so its really a small rise in real value at best.

3.the current Debt to GDP at a worldwide level is sitting at 350%! The use looks comparatively benign at a mere 140% of GDP.
In 1985, the then relevant nations gathered at the Plaza hotel in New York city. They collectively decided that US current account deficit/ GDP ratio at 2.5% was far too high and the rest of the world would sell US dollars. Conveniently, the Fed government no longer report it. But others do.According to BEA, the us current account deficit 3.6% up from 2.9 % in 2020. If 2.5% was too much for the finance ministers in 1985, what would they think of todays 3.6%??

4. There is a bit of a liquidty crunch happening in US treasuries.
Japan has pulled back from buying US treasuries as it seeks to prop up the Yen.
The US fed has been shrinking its balance sheet of US treasuries, so not only is it not buying , its a net seller.
Other potential Buyers, China, Russia, the OPEC middle eastern countries have vowed to move out of the USD.
Personally, I see major problems for the USD and the US economy.
Mick
Click to expand...
There's much more to it than this. You need to look at demographics and then how the U.S (by almost any metric) compares to the rest of the world.

China, for example, is in the middle of civilisational collapse.
 

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