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Is lower inflation "transitory" too?

The world [i]transitory[/i] is such a warm and fuzzy word. Like when the dentist tells me the pain will be [i]transitory[/i] when he pulls my tooth out.

But should this word also be applied to the lower inflation we have experienced over the past few months? Will food and energy prices start their ascent once again when the cold weather sets in and Europeans need to heat their homes, and the poor Ukranian harvest caused by the war starts to be felt? Will the monetary authorities remain committed to their 2% goal right into the teeth of a global economic panic, or will they blink? Will Jerome fold like a cheap suit?

Janet Yellen seems to have forgotten about the word [i]transitory[/i] too. Perhaps what she primarily cares about is that this [i]transitory[/i] period lasts until the mid-terms.

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TheOneyouwerewarnedabout · 41-45, MVIP

WAR IS PEACE, FREEDOM IS SLAVERY and IGNORANCE IS STRENGTH.
-ministry of truth.

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Slade · 56-60, M

@irishmolly72 🤮

irishmolly72 · 56-60, F

@Slade And we wonder why there's a recruiting crisis. 🤣

DallasCowboysFan · 61-69, M

@irishmolly72 She's a REAL Ladies man !

whowasthatmaskedman · 70-79, M

Transitory refers to the root causes of the inflation.. Usually due to the rising cost of inputs like labour and raw materials.. Which can become a cycle that needs to be broken, with prices chasing wages and wages chasing prices. This time its different. With the global supply chain being disrupted by Covid and lockdowns, international shipping bottlenecks and labour shortages, Plus the Russian efforts in the Ukraine and power shortages related to that. These things are expected to wash through themselves with time.. Naturally it is way too much to hope that those costs will return to normal..😷

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whowasthatmaskedman · 70-79, M

@irishmolly72 In my view that depends on what you want the government to pay for, and what the nation needs. America is a massive nation with over 300 Million people, with disconnected borders and land borders to other nations. Those things alone raise enough issues to be completely different from Briatin, or Sweden or Japan. Population density, ethnic mix. The needs of defence..And the nature of the nations industry all play a part. So you start with the nationd GDP. Then look at the needs of the nation, and the tax revenue and go from there..😷

irishmolly72 · 56-60, F

@whowasthatmaskedman How about a balanced budget amendment? At least then we would have to actually pay for what we spend.

whowasthatmaskedman · 70-79, M

@irishmolly72 An excellent idea. As long as the right choices were made.. Now there isnt enough money for the new Supercarrier, the F-35. The Universal health plan, and the farm subsidies. You can have one.. or two if you raise taxes on the rich. You choose...
But for decades now America has been avoiding choices by deficit funding. (The international equivalent of taking out another mortgage on the nation every year..)

Livingwell · 61-69, M

Making money is never transitory. Gas companies not paying interest for late payments, electric companies cutting power if they will get sued in the heat. Manufacturers charging $7 a box of Cheerios due to Ukrainian grain shortage. Gas prices going up due to "scheduled" refinery maintenance during the war. We're all screwed.

whowasthatmaskedman · 70-79, M

@Livingwell Quite so.. Civilised countries are taking steps to protect or compesate the most vulnerable. (Although I think when it comes to cheerios, you can take one for the team..)😷

BiasForAction · M

I attended a conference of the nation's smartest economists and it included some Fed members. Consensus is that inflation will be with us for years and Biden is not too committed to its reduction lest it arrest the higher wages we have been seeing lately for blue collar workers.

whowasthatmaskedman · 70-79, M

@BiasForAction They are right.. I could give you chapter and verse. But its about trade being global mand getting everyone on the same page.😷

Grateful4you · M

I'm FAR from understanding economics, but it seems rather absurd and self defeating to print boatloads of paper money but no gold or silver to support it.

I remember saving the silver dollars I got on my birthday and feeling rich. Hand me a stack of hundred dollar bills and all I feel is that my hands are dirty.

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whowasthatmaskedman · 70-79, M

@Grateful4you A question for the ages.. Spend your cash on consumer durables. and traditionally appreciating assets. and make you purchases with a view to the long term.. Now the conventional wisdom is Buy Gold, silver or Diamonds. But frankly the crowd got there ahead of you and drove the price up.. So. Pay off the house and set it right. And buy quality things you will need. Maybe look into solar panels if your area supports them.. And keep a reserve of maybe 6 months expenses in cash. Thats what I would be doing..😷

Grateful4you · M

@whowasthatmaskedman Wonderful advice I truly appreciate. I will do exactly as you advised. You see, this is much like when I had my little frozen yogurt and health food items cafe, "The Yogurt Man" other trades people in the area depended on trade or barter. I traded yogurt for herbs, bulk species from the health food store, a man with a greenhouse traded clover sprouts for yogurt, a girl made me veggie burgers since I allowed her to use my store at night to make her business legal.

I can seek consumer needs based on what were imperative type items during the "Great Depression" Things like silk stockings for women became a rare luxury item, so increased trade value.

Thanks for the great food for thought. YEAH!

whowasthatmaskedman · 70-79, M

@Grateful4you In the Great depression how you fared depended on a variety of things. Not everyone was on the breadline. Some made out like thieves. But a sharing support group would be a real asset..Ask yourself. "If the price of everything local doubled, and the price of everything imported trebled, what would I do without and how would I cope?" Hopefully it wont get that back.. But if it does you are prepared..😷

asslover699 · 61-69, M

The lower inflation is known as deflation or stagflation and is a result of a recession or decrease in demand and GDP. It's not a good thing!

Consensus among large banks is 75bps September hike. Goldman was at 50bps before all the hawkish chatter.

The 2% inflation target is and has been total bullshit. Explain to me how my truck, which was $35 grand in 2004 when I bought it new, is $90 grand now, with sub 2% inflation for 15 years and the cpi hitting 8% only this year. The math is a big lie. Our currency is being devalued by money printing and debt. Thats an observable fact.

redredred · M

Noted economist Milton Friedman says the only cause of inflation is government spending. Policy creates or limits inflation.

RedBaron · M

Everything in life is transitory.

irishmolly72 · 56-60, F

@RedBaron Pretty deep for a guy who flies around in a bi-plane!

RedBaron · M

@irishmolly72 Actually a triplane.

irishmolly72 · 56-60, F

@RedBaron I sit corrected.

BizSuitStacy · M

Transitory? Whatever. US inflation is up to 8.3%. Stock market got hammered today on the news. Dow fell 1250 points (3.96%), S&P down (4.35%) and NASDAQ down (5.48%). Truth be told, inflation is probably between 12-20%. Raising interest rates to curb inflation will send the stock market into a death spiral. Things are gonna be bad for a while.

Khenpal1 · M

2% is healthy, but 4% is still acceptable . Global economy is already in transition.

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Khenpal1 · M

@irishmolly72 It may , lower cost at all chains. China is totally dysfunctional at the moment and the likely to stay such for another 10 years.

irishmolly72 · 56-60, F

@Khenpal1 India? South America? Are they alternatives?

Khenpal1 · M

@irishmolly72 South America . India as a country is a mess .

irishmolly72 · 56-60, F

Looks like [u]dis[/u]inflation was transitory.

9/13/22
[image deleted]

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Slade · 56-60, M

@irishmolly72 Good song. I'd just replace Hoover with Calvin Coolidge. Hoover sucked - just like his namesake

[i]Freaks were in a circus tent.[/i]

My favorite line and BOY does that apply!

irishmolly72 · 56-60, F

@Slade

At least there's this: Hoover fed more people and saved more lives than any other man in human history.

[quote]Hoover headed the American Relief Administration, which delivered food to tens of millions of people in more than 20 war-torn countries. Between 1921 and 1923, the aid he directed to the famine-stricken Soviet Union fed more than 15 million people daily. “Whatever their politics, they shall be fed!” he declared to opponents who accused him of aiding communism.

-History.com [/quote]

He had the balls to stop Stalin's holocaust and defied anyone to try to stop him.