CPI jumps 5% in May of 2021, fastest since 2008

image.png
 
Here's the CNN article.
https://www.google.com/amp/s/amp.cn...me-pandemic-biden-fed-corporations/index.html

It is remarkable all the things they blamed like quoting Robert Reich saying it us greedy businesses. They mentioned The Fed but didn't actually give how Fed policy caused inflation. Instead they said something about interest rates.

Inflation is always too many dollars chasing too few goods. The M2 money supply had the biggest percentage increase since WW2. Unless the quantity of goods produced kept up with money that people have in their hands to spend or unless velocity dropped dramatically inflation was the predictable outcome.

MV = Pq still holding strong. Amazing how these economists ignore the economics they learned in college and what I was taught and what they presumably teach.
 
[FONT=var(--font-serif)]https://www.wsj.com/articles/powell-printing-money-supply-m2-raises-prices-level-inflation-demand-prediction-wage-stagnation-stagflation-federal-reserve-monetary-policy-11645630424

One of us, Mr. Hanke, predicted in these pages last July that year-end inflation for 2021 would “be at least 6% and possibly as high as 9%.” That was based on the quantity theory of money, which economic thinkers have used since the Renaissance. The theory rests on a simple identity, the equation of exchange, which demonstrates the link between the money supply and inflation: MV=Py, where M is the money supply, V is the velocity of money (the speed at which it circulates relative to total spending), P is the price level, and y is real gross domestic product. So, the quantity theory of money provides the link between money and inflation.[/FONT]
Click to expand...
[FONT=var(--font-serif)]If Mr. Powell is right and all that is outdated thinking, then when looking back through economic data, the equation of exchange shouldn’t be able to predict prices. But look at the chart. When we took the past 60 years of economic data and the rate-of-change form of the identity we explained above, it predicted price changes almost perfectly. Our estimate deviated from actual inflation only during 2020, as the money supply grew at unprecedented rates and lockdowns stanched real growth. By June 2021, our estimate for inflation based on the quantity theory of money had reverted back to its conjunction with actual inflation.
Click to expand...
[/FONT]
 
Gold 1950 tonight , oil moved back to about 122 today , one yr oil forecast moved to 132 , could be 200
 
Occam's Banana said:
Problem: 8% inflation
Solution: increase the money supply by 8%
Click to expand...

Which will lead to price increases of 16%.

I keep seeing idiotic stuff like this every day. I'm guessing Biden will come out with some sort of giveaway before the midterms.

Remember that the proper definition of inflation is an increase of the money supply. Price increases are the effect of inflation, not inflation itself.

So they're going to combat the effects of inflation with more inflation.
 
Madison320 said:
Which will lead to price increases of 16%.

I keep seeing idiotic stuff like this every day. I'm guessing Biden will come out with some sort of giveaway before the midterms.

Remember that the proper definition of inflation is an increase of the money supply. Price increases are the effect of inflation, not inflation itself.

So they're going to combat the effects of inflation with more inflation.
Click to expand...

The guy (who is/was an economic advisor to Jeremy Corbyn) wrote a book with a cover that depicts money growing on trees.

(Apparently, the book is just a collection of Twitter threads and tweets like the one I posted above.)


eIdvHfF.jpg
 
Last edited:
US reported inflation expected to be around 9 percent before next fed meeting raises interest rates a half percent in the late spring meeting. That 3/4 of a percent will do nothing to stop inflation. Real inflation is and will be double digit. You are in a banana republic with no bananas.
 
57 of percent Americans pd no fed income tax last yr , 60 percent the year prior with those numbers much higher than pre plague level of 44 percent . Fed gov deficit spending like inflation will keep on chooglin'
 
Fed gov needs to start cutting back now to afford that eight percent social security raise next yr
 
Heineken projects nearly a half billion loss from pulling out of ruskie land.
 
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