from Zero Hedge
A little over a month ago, a scandal erupted among the (relatively small( group of economists who keep a close eye on the monthly inflation data reported by the Biden Department of Labor, when they learned that there is an even smaller, and much more exclusive group of economists called “super users” who get preferential treatment from the BLS, including wink-wink-nudge-nudge explanations of where the data may diverge from expectations. That was the case for the January CPI when as Bloomberg first reported, the BLS sent an email to a group of data “super users”, which “explained suggested a surge in a measure of rental inflation — which left analysts puzzled — was caused by an adjustment to how subcomponents of the index are weighted”:
Investing.com — Now is the time to lean into commodities, particularly energy, to hedge the risk that a faster pace inflation may return, driven by economic growth that is running above trend, JPMorgan said.
A closely watched Labor Department report due Wednesday is expected to show that not much progress is being made in the battle to bring down inflation.
There is just too much to cover in today’s news to do it all, so I’m saving the fascinating stuff from this week’s odd convergence of solar/lunar/lunacy events for my weekend Deeper Dive, which I am thinking of calling “The Apoceclipse: We Survived!” (Of course, maybe by then we’ll know we didn’t, or those who sift through our remains 10,000 years from now when they land here will know we didn’t and will put this planet on their list of sites to see … like Pompei is on our lists.)
Inflation Has Arisen from the Dead
During an interview with CNBC released on Monday, Treasury Secretary Janet Yellen responded to a question on whether she is confident that inflation will hit the target rate of 2% by stating that she expects that inflation “will continue to come down over time.” And “we can certainly get into the twos.” Yellen also stated that “we’ve had generally good news on inflation.”
With consumer prices picking up in January and February, the jobs market still strong and the economy in rude health, traders have regularly tweaked their forecasts for monetary policy easing this year, and some are even contemplating no cuts before 2025.
The New York Times has published a strange article by Justin Wolfers, an economist at the University of Michigan. The headline is that his economist brain makes him say with regard to inflation: “Don’t worry, be happy.” The article gives the reader as much reason to trust economists as you do epidemiologists, which is to say none at all.