Supply chain hit was brutal though. Price rises on materials was insane.
So were wages though.
So were wages though.
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I just bought some stainless steel handrail and hardware to finish off the bottom two steps on the stairs, didn't realise I needed it until I broke my leg.
Anyway, the cost of the stainless fittings had doubled, since I bought the last lot about two years ago.
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US CPI for March = 8.5%.
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Not as bad as I thought... Given the war + embargo on Russian oil, loss of food supply....
So 8.5% is what we get post COVID reflation + potential ww3? Now oil prices heading downwards, potentially to pre war levels, and the markets have already corrected approx 20%....
Is this peak inflation?
Gunnerguy
Property, Index Investor & new Options trader
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I hope it’s not.
Any suggestion and the can gets kicked down the road again.
I hope to hear ‘the recession we needed to have’ again.
Get the interest rates back up to 3% / 4% / 5% were they belong. Suck up the excess money in the system. Money chasing non productive projects. Get the stock market PE’s back to ‘normal’. Get bonds back to a competitive alternative to excess money in the stock market.
It’s been too long since the GFC.
Gunnerguy
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It's looking a little like it might be.
But of course, it's probably just transitory....
I remember it as "the recession we had to have". Keating.
Yeah, but, what about us poor pricks...?
Junk debt, defaults etc the plan could well backfire.
GFC Mach II.
"Better get a bigger can to kick"
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Oil still high and back to $100.
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Will be interesting to see Aus inflation.
The public sector will be ramping up with plenty of strikes in search of decent wage rises, possibly in unison ie nurses, teachers, transport etc very soon. If successful, will that put further pressure on our inflation number over the next 12+ months?
The public sector will be ramping up with plenty of strikes in search of decent wage rises, possibly in unison ie nurses, teachers, transport etc very soon. If successful, will that put further pressure on our inflation number over the next 12+ months?
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Sometimes you need to look behind the headline figures,
the 8.5% figure is pretty bad in its own right, but when you look at the month on month figures it looks even worse.
As can be seen from the graph below taken from Trading Economics , Inflation from May thru to September last year was pretty flat, so most of that 8.5% has occurred sice October last year. And to top it off, the monthly increase has been in an upward trend as well.
The latest March increase was 0.6 %, Feb was 0.4% , Jan 0.5% , Dec 0.2%.
The other Interesting Phenomenon is that at six month intervals, in May 2020 and October 2020, there big jumps of 0.8%.
It could correspond to six monthly price reviews or rebalancing etc. Be interesting to see if this is repeated in May this year.
Mick
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Fully agree, people are claiming we have reached the peak..because.
.well maybe because they still have portfolios to offload?
There is no objective indication we are at any peak yet
Can't figure out if people that think inflation could ever peak are deluded and low IQ, ignorant or just being manipulators.
Correction, inflation will and does "peak" just before a currency collapses, dies and gets replaced.
Evidence: history.
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Indeed CPI can not even slow down unless it catches up with PPI.
If a factory has to pay 20% more today for its input, it is a given that a cpi of 8% on the current month is just begin to increase as on the next contract, the factory will have to increase its price or close.
Or slash its margins but rare are 20 or so % net margins so even in socialist lala land..CPI will rise.not to forget your rates next year following land valuations or PS and employees demanding higher wages etc etc.
Once the devil is out of the bottle, badically the currency has to fold or a long painful slow process engaged.decades...
.....and that's why it kinda looks like it works. We avoid the big hit because the burden is transferred to our kids & grandkids.
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Peak of actual inflation or peak of the headline statistic?
The latter will wobble around simply due to math given that the ramp-up thus far hasn't been linear which is about to become a factor in the year on year comparisons.
For actual inflation though well my anecdotal observation is that rather a lot of the population seems to have an incredible amount of money to throw around on all manner of things. Something really doesn't add up there looking at the sorts of cars and houses being sold versus statistical average earnings meanwhile everyone seems to be buying new this, that and something else. It's all way out of whack and seems like pretty much everyone must've just won the lottery or something.
My strong suspicion being that it's all built on an enormous amount of debt.....
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I definitively noticed this as well. And I cringe when i look at advertised price of cars. RE, or kg of tomato at $7 and lettuce at $4 to $6 a piece ..and wonder the same.. probably not a good timing with retirement.Peak of actual inflation or peak of the headline statistic?
The latter will wobble around simply due to math given that the ramp-up thus far hasn't been linear which is about to become a factor in the year on year comparisons.
For actual inflation though well my anecdotal observation is that rather a lot of the population seems to have an incredible amount of money to throw around on all manner of things. Something really doesn't add up there looking at the sorts of cars and houses being sold versus statistical average earnings meanwhile everyone seems to be buying new this, that and something else. It's all way out of whack and seems like pretty much everyone must've just won the lottery or something.
My strong suspicion being that it's all built on an enormous amount of debt.....
i also noticed hourly rate jumping up in all conversations.
Debt probably based on HL withdrawal and the feeling rich when receiving home valuation jumping 30%
And maybe also the buy it before you can't anymore or it is 20pc more next year feeling ....for cars and durable items.
IMHO, the GFC QEs then covid scam devalued the remaing notion of work, money, assets..what is value..?
The government stopped you from working and throw money at you.so no surprise the welfare worst consequences become societal.
Savings, persistence, efforts but also ethics just pushed down the drain.
COVID de facto established the universal income as included in the Reset program.wait for the next step...you own nothing..inflation can lead us there pretty quickly too.
This is actually not a joke but Macron is sending everyone an inflation cheque in France, and Germany is giving away 100 billions to companies,with another 100 billions loan in euro, to help them survive inflation.throwing money..at inflation
Wtf? Are they joking? Is the asylum in charge?
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It would depend on what is actually causing inflation, wouldn't it?
No point ignoring the logistical problems that were being blamed for inflation in late 2021 - suppliers will need funds to adapt their business models.
But now we have a war going on that is driving up oil prices because - no point handing out money to purchase oil, but it'd make sense if that some money was spent on making businesses less dependent on oil.
They did, the new name for lottery is stimulus cheques.
My area your house would have sold for less than you bought it for the last 10 years.
Now every house that was for sale is sold and every vacant block is sold and is getting a house built on it.
People are paying for builders a couple hours drive away, every local builder is booked up for next 4 years.
Our local services are over in and cannot keep up with demand. You see it in the small things like In the main shopping area you would rarely get to half the car parks being full now they are all full all the time. Another example is waiting at an intersection, the most you would ever wait is 3 cars to go past, now you can wait 10 minutes for a break in the traffic.
Judging from the rego plates all the new people are refugees from facist Victoria.
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I would join them in leaving fascist Victoria, but it would cost me a divorce, which would be far more expensive than the GFC and the great depression combined!
Mick
There are situations where being penniless and flat broke is the better option.
Garpal Gumnut
Ross Island Hotel
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I would stick around Victoria, Mick, the Age reckon it is not replacing it's population, lowest birthrate in Australia.
Anyways inflation in moderation is good, Paul Keating, one of our greatest PMs used it judicially to curb Australians spending on silly things.
I cannot believe what young families here in North Queensland spend money on for their children.
As a nation we need to spend more on affordable housing and better public transport, not on foreign franchise toys and takeaways for lardarses.
gg
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