from Gregory Mannarino
Higher for Longer Inflation & Interest Rates Not Over Until the Fat Lady Sings? Waiting for the 2-Year Treasury Yield to Overshoot
by Wolf Richter
Wolf Street
Four decades of history say it’s not over until the 2-year yield overshoots the EFFR. It has undershot for a year, and inflation is taking off again.
Inflation surprised in 2023 with its sharp decline, driven by the collapse in energy prices and the drop in durable goods prices. Both of them have come off huge price spikes since mid-2022, pulling down overall CPI inflation from 9.0% in June 2022 to 3.1% in January 2024. But services inflation has remained high and accelerated in late 2023, which was not surprising, and then on top of this increase, it leaped in January by an annualized rate of 8.2%.
Let’s Talk ‘Inflation’, Post-CPI
by Gary Christenson
GoldSeek
A little discussion about this thing we call “inflation” after the January CPI report.
A vast majority of people see inflation as rising prices, wages and ‘pushed’ costs within the economy. In other words…
We are all, to varying degrees, taking bites out of the Fed’s excrement.
The headlines blare on about CPI, but the inflation problem was created by rapid increases in the money supply. That was the mechanics of inflation’s creation, with too many newly printed currency units seeking out a finite number of assets. That is inflation. Not today’s ‘cost effects’ headlines. This of course is the legacy of our dear monetary leaders, over-schooled in Keynesian theories and eggheads all.
Inflation Won’t Die
by James Rickards
Daily Reckoning
The January inflation numbers came out this morning, and they weren’t good for Wall Street.
The consumer price index (CPI) rose 3.1% in January. That’s a decrease from December’s 3.4%, but it exceeded consensus estimates of 2.9%.
Core inflation, which excludes food and energy, rose 3.9% on an annualized basis, which is unchanged from December. But the consensus estimate was 3.7%. Core inflation also rose at its highest rate since April 2023.
Here I want to make an important point about core inflation. From the point of view of everyday Americans, core inflation is nonsense.
Beneath the Skin of CPI Inflation, January: Powell’s Gonna Have a Cow when he Sees the Spike in “Core Services” Inflation
by Wolf Richter
Wolf Street
But that’s how inflation is, once out of the bottle: It serves up nasty surprises.
We’ll start with the “core services” CPI (services minus energy services) because this is so crucial, and because Powell keeps talking about it. We have been concerned here for months about the refusal of core services inflation to ease off, and we’ve found the acceleration in the fall last year “very disconcerting.” But that’s how inflation is – it tends to serve up nasty surprises. And now it did.
Inflation Already Ruined Your Super Bowl Party
by Peter C. Earle
The American Institute for Economic Research
Attending the Super Bowl in person has long been a lavish expense, reserved for those willing to part with a significant sum for the ultimate fan experience. But when the Kansas City Chiefs meet the San Francisco 49ers in Las Vegas on Sunday, February 11 for the 58th such championship, it will be the most expensive yet.
Stubhub is reporting tickets ranging from $5,300 to $107,000, with the average price paid around $9,500. (Ticketmaster and other estimates vary slightly.) That is a 93 percent increase in ticket prices from last year’s Super Bowl in Phoenix, Arizona, and 300 percent over the past ten years. Lodging prices are skyrocketing as well.
A week out from kickoff, rooms at five-star hotels like the Bellagio, Aria, and The Venetian started at $1,500 or more per night for Super Bowl weekend, according to Expedia.
Welcome to Inflation Café
Welcome,
Last week I went to an undisclosed coffee shop in the morning and ordered my usual latté. Three minutes later the barista handed me my latte’ and I went into shock. The cup was on crooked, and when I opened it, the contents were half-full and didn’t look very appetizing.
I just sat there as I looked at my $7 receipt and realized I’d just paid that $7 for this so-called privilege, which was more than double what I was paying just a few short years ago. What that meant to me was I was getting less and paying more. But I wasn’t done. After I got my mind on the task at hand I called over the manager over to express my outrage.
I said, “You are not selling coffee in this place, you’re selling inflation.” No wonder this chain just released record earnings, I thought to myself. “You’re just an Inflation Café!”
The manager who was in his early 30’s, just shrugged his shoulders, smiled and went about his day. Believe it or not, that’s when the concept for this newsletter hit me.
That was when the Inflation Café born. I am your personal barista giving you a guided and in-depth tour on inflation, explaining how it’s created, why it exists and providing you with ample evidence of its continued existence and how you might overcome it and make some money along the way.
Think about this. It’s not an accident that inflation happens. It’s a distinct policy that governments around the world have implemented. It is a hidden tax that gets you to work harder for a lesser reward.
As this newsletter and website progress, what we’ll do is explore the inner workings of the inflationary monster and why it will be around for decades to come.
Until you, the public is no longer willing to accept this hidden tax, which grows like a cancer, you’ll be forced to pay it. With this in mind, sit back, relax and learn.
Regards,
Kerry Lutz
Editor ‘n Chief Barista
Inflation Café