No hyperinflation pending, TIPS are retreating

[First]

^ lol.

 

[1prophet]

Of course things are getting better just make sure you can walk the red line not the blue one

http://money.cnn.com/2011/02/16/news/economy/middle_class/index.htm

 

[momeNt]

^ lol.

Lol yourself buddy!

He was real big into calling people out on their predictions, as asinine as predictions themselves may or may not be. So I was wondering if he could provide us with some insight on the gold bubble.

 

[The-Noid]

Of course things are getting better just make sure you can walk the red line not the blue one

http://money.cnn.com/2011/02/16/news/economy/middle_class/index.htm

Can you scale this chart. It is impossible to tell any kind of growth as a % on the ridiculous chart.

The blue line appears to have grown in a higher agg percentage than the red line... 395/105 compared to 60/15.

I can't really see though.

Edit: As a percentage it still looks fairly linear. Call it 395/60 compared to 105/15 == 6.5833 and 7 respectively.

Does that argument then just become that rich have been too rich forever?

 

[Fern]

Ah yes, when reality diagrees with your dogmatic economic view, you make new data to support it. You don't find it odd that no traded instruments implies inflation anywhere near that? Those guys are like the US version of Dagong rating agency, but exist for even dumber premise.

I find their inflation number far more accurate as inflation affects me. E.g., I purchased my home 15 yrs ago and it's a fixed rate mortgage. Factoring in housing prices, which have dropped, is irrelevant for people in my position (likely most people).

As regards inflation and the like, I think many people are failing to appropriately factor in temporary and somewhat unique external events like Europe's and much of world's economic problems and it's resulting rush to the dollar for 'safety'. When the RoR on treasuries goes negative it should be a d@mn strong clue that things aren't normal and that the usually reliable measures may give false readings.

I don't know when, or even if, those events compelling people to dollars will turn around. But I do wonder about the possible effect(s) when if/when they do turn around. At the rate we're increasing our national debt that money may eventually flee the dollar no matter how weak other nations economies are.

Are we in a (artificial) 'money bubble' here in the USA? In most bubbles a lot of people are making good money, at least until the collapse. Maybe in this one, if it exists, just the big bankers/finance types are making money? What's gonna happen when it collapses?

Fern

 

[dullard]

LOL, I am neither smart enough nor dumb enough to make that kind of prediction. No one here is...

Nonsense. Are you willing to give your own predictions for inflation/deflation in the coming years?

You could, but you'd look as dumb as the poster before me who 15 months ago said we'd be out of this economic mess in 12 months.

After doing the math, IMO, we'll have very mild inflation (1.0%-3.0% year-over-year on average with monthly spikes lower and higher than that range) for the next 2-3 years...All predictions in this paragraph are year-over-year changes on CPI as currently defined...The CPI for Jan 2013 will be in the 223.3 to 236.8 range.

Three years later, the data is here. Drum roll... ftp://ftp.bls.gov/pub/special.requests/cpi/cpiai.txt

Averge inflation of 2.049%. CPI for Jan 2013 was 230.3. It couldn't have been much closer to the centerpoint of my prediction.

 

[Paratus]

Three years later, the data is here. Drum roll... ftp://ftp.bls.gov/pub/special.requests/cpi/cpiai.txt

Averge inflation of 2.049%. CPI for Jan 2013 was 230.3. It couldn't have been much closer to the centerpoint of my prediction.

 

[halik]

Three years later, the data is here. Drum roll... ftp://ftp.bls.gov/pub/special.requests/cpi/cpiai.txt

Averge inflation of 2.049%. CPI for Jan 2013 was 230.3. It couldn't have been much closer to the centerpoint of my prediction.

I love that you love this thread.

 

[dullard]

I'm not going to keep making predictions and keep updateing this thread. I haven't been giving inflation enough thought to do so. My uninformed estimate will be 2.0 to 2.5% through summer. But there will be a commodities crash that will drop inflation down to the 1.0% range in the mid-term (possibly even a slight deflation period if they fall quickly enough). Long term though, I forsee 4% coming by 2015. Don't quote me on it though.

 

[halik]

Bump

CPI at 1.4% in May 2013
http://www.bls.gov/news.release/cpi.nr0.htm

 

[momeNt]

Why argue about inflation this or inflation that, let's just look at the recovery all around us and be appreciative of all that our fiscal and policy leaders have done for us in our time of need.

 

[Joepublic2]

The entire premise of this thread is flawed as CPI is a meaningless, cooked figure that has been politically manipulated since at least Reagan's administration, much like unemployment. It in no way is an accurate measure of real price inflation.

http://mondaymorningeconomist.com/cooking.html

http://www.zerohedge.com/news/2012-12-20/guest-post-why-reported-inflation-seems-different-reality

 

[momeNt]

The entire premise of this thread is flawed as CPI is a meaningless, cooked figure that has been politically manipulated since at least Reagan's administration, much like unemployment. It in no way is an accurate measure of real price inflation.

http://mondaymorningeconomist.com/cooking.html

http://www.zerohedge.com/news/2012-12-20/guest-post-why-reported-inflation-seems-different-reality

It's a scientific measure where we can measure the impact of fiscal and monetary policy. You cannot debunk economics any more than you can debunk gravity.

You do realize that people go to school anywhere from 4-8 years to be practiced in the study of economics right? They know a lot more about this than you do.

 

[Joepublic2]

It's a scientific measure where we can measure the impact of fiscal and monetary policy. You cannot debunk economics any more than you can debunk gravity.

You do realize that people go to school anywhere from 4-8 years to be practiced in the study of economics right? They know a lot more about this than you do.

Yeah I'm sure the govt is accurately reporting statistics in good faith when they have every incentive not too (boost GDP, reduce SS and welfare payouts, make the $ look stronger than it actually is). I'm not debunking economics; I'm linking to articles debunking bullshit voodoo economics like the CPIs (plural because the measurement has changed dramatically, many times over the past 40 years).

Besides, you haven't refuted anything I've linked to.

 

[sm625]

TIPs gain when bond yields drop, and they lose when bond yields soar, this is normal expected behavior. What is not normal is for bond prices (and TIPs) to be falling while stocks are falling. They usually move inversely.

 

[fskimospy]

Yeah I'm sure the govt is accurately reporting statistics in good faith when they have every incentive not too (boost GDP, reduce SS and welfare payouts, make the $ look stronger than it actually is). I'm not debunking economics; I'm linking to articles debunking bullshit voodoo economics like the CPIs (plural because the measurement has changed dramatically, many times over the past 40 years).

Besides, you haven't refuted anything I've linked to.

That's absurd, and this ridiculous argument has been debunked on here many times. Not only is CPI a number of different measurements, but how it is calculated is completely transparent. In addition, independent sources like the Billion Price Index independently verify CPI.

When people find out their economics are wrong they always blame a conspiracy instead of realizing their understanding is wrong. See: ZeroHedge.

To learn more about CPI look here: http://www.bls.gov/cpi/cpifaq.htm

 

[fskimospy]

If nothing else, this thread serves as a continuing reminder of what a joke the Austrian School is.

Not that I expect any of its adherents to come by and admit it was wrong. Like I said before, they will invent conspiracies by the dozen.

 

[Darwin333]

Yes, because if it's not done under these circumstances you'll flatline the Economy for a very long time.

And if we were to do what you propose and the economy takes off and starts absolutely booming then bond rates return to historical norms...... then what?

But you are correct, government spending is actually one of the numbers used to calculate GDP so if that number increases without taking it out of our economy via taxation GDP must mathematically rise.

 

[Sonikku]

I want my 100 Trillion dollar bill like they get in other countries.

 

[Darwin333]

It's a scientific measure where we can measure the impact of fiscal and monetary policy. You cannot debunk economics any more than you can debunk gravity.

You do realize that people go to school anywhere from 4-8 years to be practiced in the study of economics right? They know a lot more about this than you do.

If that is true then why did they change it not long ago resulting in a VASTLY lower cpi over time (compounding is a bitch)?

 

[fskimospy]

If that is true then why did they change it not long ago resulting in a VASTLY lower cpi over time (compounding is a bitch)?

If you go and read the CPI FAQ I linked it explains it quite well.

 

[dullard]

If that is true then why did they change it not long ago resulting in a VASTLY lower cpi over time (compounding is. a bitch)?

There have been and always will be multiple CPI foumlas. They didn't change the formula for political purposes (or for any other purposes). The formulas were unchanged. Instead, they politically changed WHICH formula to use when making political decisions.

Basic knowledge is a bitch.

 

[Attic]

I want my 100 Trillion dollar bill like they get in other countries.

With any significant taper we'll destroy the value of the last 4-5T of debt we created by sending interest rates to 5-6% and we can avoid that while also limiting incentive for future borrowing.

If captain America doesn't taper and instead increases printing you may be in luck.

 

[momeNt]

If that is true then why did they change it not long ago resulting in a VASTLY lower cpi over time (compounding is a bitch)?

Does CPI take into account federal benefits that offset inflation? I think not.

Buying a loaf of bread isn't any more difficult for a poor family today compared to 5 years ago. The only thing that maybe changed in a few people's cases is where the money came from, but it is ridiculous to try and separate money from employment and money from federal aid, because in the end all that matters is that the family has bread.

 

[momeNt]

With any significant taper we'll destroy the value of the last 4-5T of debt we created by sending interest rates to 5-6% and we can avoid that while also limiting incentive for future borrowing.

If captain America doesn't taper and instead increases printing you may be in luck.

There is zero incentive to taper when no country is going to circumvent the dollar for trade or reserves.

If your money is used as the currency for reserves as well as trade, when you print money you are printing WEALTH.