We all might as well shave a billygoat’s taint follicles and use them to make fake mustaches so that we can pretend that we are Chuck Norris at the nightclub so we can pick up the ladies cuz discussing things in this forum is like driving blind down a steep mountain while a rabid monkey attempts to strangle you to death .
@BigGame90
So lets have a real discussion on this inflation beast currently residing in the world and for sure the US is not the worst victim but for sure it is bad, I know it is worse in Europe but they dont seem to whine about it as much as the US does IMO.
First thing, I throw out the term Bidenflation at home and my wife laughs because we both know this has nothing to do with Biden nor government spending because to push the needle this far and this fast means an exponential increase in G spending as G spending in economic terms and in inflation terms is minor, so while the spending is up it is not enough to push the needle this far this fast.
So inflation, how is inflation created? Inflation is demand driven or supply driven and can be compounded by a monopoly or a supply shock or a massive demand shock. How was this bout of inflation created? Can we actually determine with real numbers and trends that can validate it that this inflation is due to G spending or spending at all? To move the needle this high and fast to me points far far away from G spending since we have been G spending for decades and yet here we are with the greatest inflation spike since likely the 80s as to speed and relative severity.
Another reason I think this is not demand based or excess G spending based is the FED has ramped rates hard, straight line up and in the past even moderate moves squashes demand based inflation because in theory raising rates smashes speculative demand, in the same way that the FED squashed the fake oil supply ramp as the lack of cheap speculative funding evaporated, and it wasnt really even the FED rather banks stopped giving zero cash out and that is the same as a rate hike to the general economy, the speculative frackers got wacked, banks stopped lending and our fake oil independence went away and that is why the monopoly now controls pricing.
My view is this situation started from a supply shock that still exists, the supply chain still is not fixed and that is largely due to higher interest rates...it costs corps more to finance inventories with rates higher and the only corps that are not hurt are those who sucked the debt market dry with long duration debt, so the large cap tech are still enjoying that cheap interest costs because they went longer in duration. Now that SOME supply issues are better but not FLUSH, the issue has morphed into a GREED-flation plus a lack of flush inventories. I do not consider this inflation to be consumer demand driven, I just do not see any sign of excess demand to the extent that would push inflation like this. We had more demand back in the .com bubble and the 2007 housing market bubble from a consumer perspective and yet neither compares to what we face now.
So take off the DEM vs Repub glasses and discuss economics and inflation. The G portion of the pie does not spike inflation, it just is not validated or backed by any real data so you can spare the BIDEN poop throwing, it has little to do with the government.
Oh boy. This discussion again ?
Wall, I find it remarkable for you to say you "know" government spending had nothing to do w inflation. We "did" have an exponential increase in spending..... in covid years.
Consider this. This country " Never" had a trillion dollar spending bill,... ever, prior to covid. Then we proceeded to pass "Multiple " Trillion dollar spending Bills
You continue to ignore what's right in front of you. 
This isn't to say that supply shocks didn't contribute to inflation, but demand shocks via government handouts to individuals, and Trillion dollar spending bills are still doing the trick to overheat the economy.
And guess what, things are gonna get worse w inflation. This inflationtiary spiral w wage inflation ( via striking workers) is only going to put further upward pressure on prices for Consumers. Hope nobody is in the market for a new car, because it's about to get more expensive..
Also, how about those gas prices ?
Inflation is looking like it hit an immediate bottom in July, and trending higher.
If you and your wife scoff/laugh at the suggestion of "Bidenflation ", I can assure you most people can connect the dots on "Bidenomics " !!
I would not say 'whine' is the appropriate word to use. Considering it is in the news every single day and the folks are complaining about it day in and day out, I would say the folks in Europe are for sure complaining and talking about inflation.
Just a couple of days ago there was a good article on the 'inflation inequity' and how it seems to affect the lower income countries and folks more, etc.
Then today there was a big article on the things people are starting to sacrifice because of costs -- like personal items such as detergent and tampons.
Then there was a good analysis earlier this week on how the EU has worse inflation than the USA and why that is and how long it might last.
They are constantly asking when it is going down, etc.
They have the same main issues right now the USA has in the news every day -- immigration, inflation and economy, and energy costs and concerns and in their elections how some of the hard-right are gaining traction because of frustration.
Just because you do not see or read about it does not mean the folks are not 'whining' about it. Some of their political blogs are more or less dedicated to it.
Last I looked at the 12-month PCE closely, the factors were about about 50% supply, 30% demand, and 20% a multitude of more nebulous things.
This is when the demand items have a sudden move in price that moves in the same direction of a sudden move in quantity.
The supply items would be the ones that have a sudden move in price that moves opposite a sudden move in quantity.
However, the supply-chain issues from the lockdowns had a huge affect and does not seem to be all the way worked out yet.
Then you still have the worker shortage issue that exacerbates the supply issues. This is also causing employers to have to pay workers more to get them to come back to work.
Then you have the influx of money from the government of $5 Trillion dollars. When you put that amount of money in the system it takes a while to get through the system. A good case could be made for this to take another 12-18 months. This amount of money injected to the system has certainly lifted the prices.
The argument can be made that it, or at least some of it, was needed in order not to have a financial meltdown of sorts.
But the over-arching point is a lot of this can be blamed on the overreaction to the pandemic and that some of this inflation was needlessly caused. It, for sure, did not need to be this bad.
It is not just inflation, but the whole economy is having a hard time recovering from the nonsense that went on during that time.
Then you can make a good case that the FED has not handled this well. They always react too late and they always underact.
It is a big mess and I do not see it coming down anytime soon. I would be surprised not to see a recession in the next several months.
@Rush51
I felt like I explained the terms pretty well but I can go into more detail just to be clear. We are talking about inflation, that means an increase in prices from one period to a different period, so my premise was that yes government spending has gone up, yes that is true but it has gone up pretty steadily for most all duration of time hasnt it? As the population grows, spending goes up for the general population and also the government..so that is a given.
To create inflation, year over year increase in prices you have to spend a large degree MORE than the previous period, that is how you increase inflation on a demand theory and that is what a few of you are claiming. So my comment was that the contribution of the government to the total equation of economic spending per pretty much any theory or equation is not all that large relative to the total equation. So what is the contribution of government spending to the total economic consumption and thus demand? That is what I am discussing. So if you look at a chart of government spending, it goes up pretty much every period and there is no real need to contest that..just as the total spending in our economy usually is on a up slope, so no shock in saying that. Now even with covid spending and the T budget, how much of an increase has government spending gone up PERIOD OVER PERIOD...that means the measure/gauge of this inflation is period over period, so how much has that gone up on a percentage basis? Then how much of that increase impacted the TOTAL economic consumption for the US?
Say that government spending is 30% of total US consumption (I am guessing, you could say 40 or 50 even which is of course not true) say that period over period G spending went up 25%, well year over year thats pretty big, I would be shocked if it was that high but lets say it is...then to extrapolate it to total consumption it would mean in that example that total consumption/demand based ONLY on increase in G spending went up 7.5 percent, just based on pure math and real stats. So you can easily extrapolate exactly what contribution G spending increase has on this inaccurate theory of inflation creation and it does not take long to determine if this theory holds any credence and I suggest it does not.
Next you have to determine how much an increase in G spending over say the last 10-15 years has been absorbed and not reflected in total demand inflation, that is also not difficult to draw a conclusion, over the last 15 years inflation has not cracked 2% like ever...maybe for a blip month but really it hasnt, and so why would an increase in G spending and total economic demand NOT impact inflation when the suggestion NOW is that it does? This is just basic supply and demand economic theory here...I am not discussing blame or DEM vs REPUB or anything, just economic theory.
@wallstreetcappers
the issue has morphed into a GREED-flation
I think this is the answer everyone is looking for. Question is, how do you stop it or slow it? Wall Street needs big corps to keep hitting their numbers to keep the stock market up, because everyone is wealthy on paper and leverage, until the music stops. How do you keep numbers up as demand slows? Raise prices until demand gets decimated and make up the lack of demand with price gouging (my opinion). Pass on operating costs to consumers. Problem is, people keep buying shit so prices will stay up until people stop buying shit. Just look at consumer debts, they are sky rocketing as credit card balances are hitting all time highs. Either this is purchasing the necessities, and/or spending on unnecessary stuff.
Can you explain why the stock market rallied while the country was locked down? Why did RRP hit record highs (now currently falling)? Why are banks sitting on so much cash?
It's pretty simple to understand that printing records amount of "cash" is going to lead to inflation (greed-flation). Why did we get put in a situation and need to print so much money? You can't print records amount of money and expect prices of literally everything to stay put or go lower. I am by no means an economist so I won't have answers. There are so many factors that attribute to inflation that nobody is going to every have the exact answers. Inflation is going to hurt those with fixed incomes, which happen to be a very large portion of people on the brink of retiring. I believe these are the "boomers". The "boomers" were also the ones that were able to afford college, homes and cars without getting into massive debts. Hopefully they planned well and hopefully everyone that is younger is learning from the past and preset to plan for the future, when hopefully, economic times get better.
You do have to consider the sudden influx of stimulus, or relief, money. The 2008 relief money was slightly less than $800 Billion. In the last few years that amount was close to $5 Trillion. That is a huge amount of money no matter how you look at it. Then you add this to people being locked up and saving money and now out and about spending money they have saved and money that the government provided. So, now you have a surge in demand as well as all of the supply issues.
You cannot put it all on any of the causes because they all have to factor in. It can be tricky to parse out. Countries that did not use huge government money to stimulate their economy still had the inflation. Some of that, of course, is due to the other supply issues for other countries -- but, nonetheless, they still had the inflation without their government throwing money into the equation.
Then you have to factor in how late the FED got involved and how little they raised the rates, bit by bit.
Another thing that absolutely has to be considered is the increase in oil prices and all of the issues with that right now. Sanctions on Russia, the war in Ukraine has added to the oil and natural gas increase in prices. This has also caused the price of other things to go up, like wheat for example.
So, now you have food and other crops increasing in price and this has been affecting other countries, especially the non-first world countries, even more.
You can even take away some of the various effects of the pandemic with the CPI inflation numbers -- because people being locked down forced them to spend on different goods and services than they normally would have.
So, absolutely the pandemic played a large role in the increase in inflation and you, certainly, cannot dismiss the role of the large, sudden increase in government spending because of this. The extent is still working itself out.
It became quite tricky. Because as the effects from the Pandemic were easing the war in Ukraine started. So, even though the USA was dealing with an output gap the majority of the inflation still seems to be a cost-push type of inflation.
It is not an either/or situation. This has many factors, more factors than usual, and is somewhat complex and dynamic.
I do not see it easing up much for quite some time.
@BigGame90
Good post. I would add that there are people that are still able to afford houses and cars without going into massive debt.
They simply buy within their means and do not live on too much credit and debt.
The mindset has changed over the years and people grow up thinking they need to use credit cards, get exorbitant student loans, buy two brand new cars, and buy a house that is too big for them, etc.
Look at how much bigger and nicer the average 'start-up' home is compared to years ago. Same with cars, etc.
@BigGame90
Only way to KO greed-flation is for consumers to reduce demand even more. I see greed-flation all over the place especially in the grocery store, there is no reason for example that Coke would raise their prices 50% given that their product costs are pretty simplistic, their supply chain is likely not wrecked and they have distribution channels which are solid...so the fact that their prices have gone up so much is pretty standard greed-flation.
I know I have drastically reduced my consumption with these higher prices, I wont pay ripoff costs for products that I am not completely needing, so my leisure consumption has gone down a TON. Unfortunately most are not in my mindset and so corps can keep these prices up until demand forces them to do otherwise. I have noticed the egg supply chain imbalance seems to be slowing, prices are coming back down to previous levels. If the consumer is upset about prices for groceries or QSR purchases then adjust consumption and force corps to adjust their pricing.
The reason the markets went up up up are that many will come out stronger, especially since the "markets" are really about 10 stocks which are so large they should be broken up, the way we have T market cap valuations should make the government break those up, they are monopolies and we should not allow that to continue IMO.
@Raiders22
I agree. I think the new home buyers are those worried that rates will continue to go up, or are of the mindset of FOMO and believe prices will continue to rise. Can't refi out of a 5-7% if home prices don't continue to go up. PMI will eat away at first time home buyers after a few years. Canada looks to be in some trouble in the next few years as a very large majority of loans are fixed for only 5 years. It's only been a few years since rates started to go up. They're all floating in the same boat but sitting in different sections of leaking boat.
I am in a fairly large city and apartments and townhomes are going up all over. They are slowly getting leased/rented and there are plans to build even more which is crazy in my mind. Unless the goal is to drive up vacant inventory so prices fall. They call it "affordable" and I just laugh at the rents they're asking. Shitty looking stucco, square blocks that look like jails with fancy, annoying and very reflective windows.
As for autos, I am of the firm belief that the auto industry jumped on the price increase bandwagon while banks also needed higher loans on their books. Did anyone find it odd that used car dealers were calling previous sales back and offering more money to buy the car back right before the price of used cars sky rocketed? I guess it was the "chip" shortage that was driving prices up, like it was "supply chain issues" driving up the costs of goods.
It's definitely a speculative time in markets. Buy with relative high rates before prices continues too increase, or sit and wait for a crash/dip with the possibility of missing out? I think pausing rates is giving everyone time to prepare for the inevitable, if you're looking ahead. Also a last push to get home sales before rates get too high and force sellers to take massive hits on sales (sellers are already lowering prices and most homes I check). It was a nice end of summer pause on rates to push home sales so MSM can say the economy is fine and Biden is doing great. If the economy was so great and the financial industry was strong, why bank fails?
@wallstreetcappers
Doesn't appear people are stopping their purchasing (on credit). It's like, "everyone's walking around like they're in a damn Enya video". Who would you point out in those top 10 as being the monopiles?
Good post BigGame.. And I love that line from the "Big Short." 
Housing Affordability is in one of the worst periods ever for consumers. A recent article cited the "average income" American Consumer can no longer afford a "median" priced home in the U.S. , currently arround $400k. Affordability is based on 3 key components ; how much does a person make, the price of the home, and the interest rate on the mortgage. Consumers for the last 15 years had the luxury of counting on interest rates to be very sub-standard... No more. Reality is setting in for just about everybody, and nobody wants to move to a another home for obvious reasons..
It's tough sledding out there, and we aren't even in a recession yet ! 
Stock markets are taking their cue from the bond market, and things are getting worse before they get better.. Higher interest rates are in our future.
@BigGame90
This is another Euro comment, the US is so lucky to have affordability for such a long time where our neighbors in Canada have been dealing with out of control prices for much much longer and in Europe affordability has been poor for a very long time and they have less "creative" products than the US has, we have more choices and less financial restrictions. I think having a capitalism based market brings more risk and more default because we allow default and foreclosure and less risk to collection than in Europe.
I think the only way the US could have rebuilt after 08 was to lower rates to create more transactions. After all the foreclosures, banks had to cut the 7 year buy freeze out and lowered it to 3 years so previous borrowers who had to foreclosure could buy back in. That just sped up the recovery. Now, add in foreign buyers, large corporations scooping up SFH with the anticipation of becoming landlords (for this time when buyers are getting priced out) was the plan all along. Corporations should not be allowed to buy SFH homes, or even multiple family homes. That is creating a monopoly and price control.
@Rush51
Hopefully there's a sweet spot when rates lower and prices are more affordable so people, not corporations, can actually purchase homes that will be their life long investment. It's def an odd time with finance right now. People hoping their 7% rates will be able to be lowered with a re-fi down the road. They're going to need a lot of breaks in order to hit that mark, unless they're able to put a massive amount of cash down. First time home buyers are taking a huge risk right now as they'll need to gain 20% in equity in order to re-fi, and hope rates lower.
sounds right we r way bettor off now than 2020 or in late january when biden took office from the disgusting sexoffender now indicted on 91 counts of crime
So, is that supposed to make the family that is struggling in "anytown USA" feel better ? Sure, things might be better on a "relative" basis compared to Europe, but is that supposed to make the family here feel any better ? Things are pretty shitty out there all around, and Biden gets low marks on his handling of the economy,... and rightfully so.
Let's be clear ... Bidenomics has failed the American consumers...
I completely agree with this... It wasn't the pandemic itself that caused all this inflation ; it was the "reaction" to the pandemic that needlessly caused a lot of the inflation. Then, on top of this when Biden came to office, he needlessly kept his foot on the pedal signing Trillion Dollar Spending Bills. This poured further gasoline on a bonfire of previous Trillion Dollar Covid Spending..
But back to the initial government response to Covid. The decision to close the U.S. economy in March 2020 due to Covid set in motion a dangerous inflation combination. Sending workers home, and having only "essential workers" exist for that time seriously disrupted supply chains in both goods & labor. Cutting off supply was a certainly a "contributor" to the inflation. Then, the government chose to pay all workers (and then some) with a stimulus check, sometimes multiple checks ! So, you have a decrease in supply, and an explosive punch with government handouts to the people AND Trillion Dollar Covid Spending Bills that propagated through the Economy.
If the government hadn't made the decision to close the economy, the handouts and Trillion Dollar Covid spending may not have ever occurred, because you didn't tell workers to go home.. I think we still would have had "supply" disruptions because of numerous sick/afraid workers, but not to the degree with which we experienced, because we closed our economy..
way better off 
Coupled with paying some folks to, more or less, stay home and not go back to work. This hurt a lot of mom and pop type places bad!
@KellyM_1964
Absolutely! I still remember that time vividly, notwithstanding the chaos and fallout from trump inciting an insurrection.
First thing, I throw out the term Bidenflation at home and my wife laughs because we both know this has nothing to do with Biden nor government spending because to push the needle this far and this fast means an exponential increase in G spending as G spending in economic terms and in inflation terms is minor, so while the spending is up it is not enough to push the needle this far this fast.
So inflation, how is inflation created? Inflation is demand driven or supply driven and can be compounded by a monopoly or a supply shock or a massive demand shock. How was this bout of inflation created? Can we actually determine with real numbers and trends that can validate it that this inflation is due to G spending or spending at all? To move the needle this high and fast to me points far far away from G spending since we have been G spending for decades and yet here we are with the greatest inflation spike since likely the 80s as to speed and relative severity.
Another reason I think this is not demand based or excess G spending based is the FED has ramped rates hard, straight line up and in the past even moderate moves squashes demand based inflation because in theory raising rates smashes speculative demand, in the same way that the FED squashed the fake oil supply ramp as the lack of cheap speculative funding evaporated, and it wasnt really even the FED rather banks stopped giving zero cash out and that is the same as a rate hike to the general economy, the speculative frackers got wacked, banks stopped lending and our fake oil independence went away and that is why the monopoly now controls pricing.
My view is this situation started from a supply shock that still exists, The supply chain still is not fixed and that is largely due to higher interest rates...it costs corps more to finance inventories with rates higher and the only corps that are not hurt are those who sucked the debt market dry with long duration debt, so the large cap tech are still enjoying that cheap interest costs because they went longer in duration. Now that SOME supply issues are better but not FLUSH, the issue has morphed into a GREED-flation plus a lack of flush inventories. I do not consider this inflation to be consumer demand driven, I just do not see any sign of excess demand to the extent that would push inflation like this. We had more demand back in the .com bubble and the 2007 housing market bubble from a consumer perspective and yet neither compares to what we face now.
So take off the DEM vs Repub glasses and discuss economics and inflation. The G portion of the pie does not spike inflation, it just is not validated or backed by any real data so you can spare the BIDEN poop throwing, it has little to do with the government.
@WSC
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