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Author Topic: So much for inflation being "transitory"  (Read 14758 times)

Uncle Rico

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Re: So much for inflation being "transitory"
« Reply #250 on: September 29, 2022, 12:21:42 PM »
That was Reagan, not Pelosi.

That’s who I meant.  Just say no to drugs, not dongs
“This is bar none atrocious.  Mitchell cannot shoot either.  What a pile of dung”

Plaque Lives Matter!

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Re: So much for inflation being "transitory"
« Reply #251 on: September 29, 2022, 01:59:06 PM »
RIP Throatus

Goose

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Re: So much for inflation being "transitory"
« Reply #252 on: September 30, 2022, 09:24:25 AM »
I realize that Rocky thinks I underestimate my fellow Americans and their being prepared for a potentially serious economic downturn, but I saw on CNBC today that 60% of Americans are living paycheck to paycheck. Over the past week I have read many big time money guys sounding the alarm on a potentially serious economic episode on the way, and I am hoping they are stating this in an attempt to slow down the Fed in big interest rate hikes moving forward. That is one my glimmer of hope is that the big boys can put fear into the Fed.

Uncle Rico

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Re: So much for inflation being "transitory"
« Reply #253 on: September 30, 2022, 09:26:15 AM »
I realize that Rocky thinks I underestimate my fellow Americans and their being prepared for a potentially serious economic downturn, but I saw on CNBC today that 60% of Americans are living paycheck to paycheck. Over the past week I have read many big time money guys sounding the alarm on a potentially serious economic episode on the way, and I am hoping they are stating this in an attempt to slow down the Fed in big interest rate hikes moving forward. That is one my glimmer of hope is that the big boys can put fear into the Fed.

My financial wizards have said similar, however, they also believe a quick bounce back.  We’ll see
“This is bar none atrocious.  Mitchell cannot shoot either.  What a pile of dung”

Goose

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Re: So much for inflation being "transitory"
« Reply #254 on: September 30, 2022, 09:35:46 AM »
Rico

Like it or not, the big boys have extreme power, and they definitely are sounding the alarm. Seldom do you see a slew of power brokers and economists singing the same song. I am in the camp of quick bounce back but hope it does. I think there is an awful lot of work to be done in corporate America to unravel all of the mess created by cheap money and the pandemic.

I have noted in past posts my experiences in our small company and disturbing trends are building every week. I mentioned last week in regard to our incoming AR and we are going to end the month at approx 80% of expected money received in September. To make matters more disturbing to us, for the first time since '08-'09 it appears that we have a couple of clients that will not be paying at all. We have had virtually no bad receivables in almost 15 years and it looks like the good run is coming to an end.

jesmu84

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Re: So much for inflation being "transitory"
« Reply #255 on: September 30, 2022, 11:01:39 AM »
https://www.cnbc.com/2022/09/26/whartons-siegel-says-jerome-powell-owes-the-american-people-an-apology-for-poor-fed-policy.html

Goose - folks have been living paycheck to paycheck for years with increasing numbers. Unfortunately, our government refuses to act and orgs/execs refuse to budge on monetary distribution

MU82

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Re: So much for inflation being "transitory"
« Reply #256 on: September 30, 2022, 11:24:19 AM »
I realize that Rocky thinks I underestimate my fellow Americans and their being prepared for a potentially serious economic downturn, but I saw on CNBC today that 60% of Americans are living paycheck to paycheck. Over the past week I have read many big time money guys sounding the alarm on a potentially serious economic episode on the way, and I am hoping they are stating this in an attempt to slow down the Fed in big interest rate hikes moving forward. That is one my glimmer of hope is that the big boys can put fear into the Fed.

Goose, I'm going to ask you to try to remember what you thought about a couple of other events. If you can remember, I have no doubt you will be truthful about your recollections.

1. The Great Recession. Every time I bought a stock or a fund, it continued going down. It was lather, rinse, repeat. Lots of pundits expected that recession to last for years and years and for the economy to remain broken for a long, long time. But it really lasted only about 2 years, the job recovery was unprecedented, and the market went on to scale never-before-seen heights. Housing also more than recovered -- it recovered so well that yet another bubble was created. For investors the Great Recession was The Great Gift. Those of us who invested regularly and stayed invested for more than a decade were rewarded handsomely. Those of us who owned or bought houses in good neighborhoods were rewarded with their value skyrocketing.

What did you think when the GR was going on? Did you think it would last only a couple of years and the recovery would be one that would turn lots of regular folks into classic "millionaires next door"? Or, as it was happening, did you think, "Shyte, things are really, really bad, and this might go on for 5 years or 10 years or more"?

2. The Pandemic Plunge. When we went into recession, and the market went into a free-fall, in the late winter and early spring of 2020, I thought it was going to take at least a year, and probably years, to recover. The overall economy still hasn't totally recovered from the pandemic, but the jobs recovery was strong, the consumer recovery was strong, and the stock market recovery was more than I expected.

How about you? Did you think that everybody who wanted a job would be able to get one, and that the job would pay more (in many cases much more) than it did before the pandemic? Did you think the market would hit bottom in only 6 weeks before beginning a climb that greatly benefited investors? Or, when it was going on, did you have mostly doom-and-gloom thoughts of a long, drawn-out economic collapse and market crash?

I ask for two reasons. One, I'm curious to know if you correctly predicted what would happen with those two most recent economic crises. And two, I'm kind of making the point -- in my case anyway -- of how in real time, when things are going on, they often are not as bad as they seem ... or as good as they seem in good times. Or maybe you think that "this time it's different" for some reason.

It's pretty easy to sit here right now and be all doom-and-gloomy. I'm not exactly turning cartwheels, and I'm a pretty optimistic guy. But I've also lived through five recessions as an adult, and each time the economy and the market recovered. So again, personally, I don't think I'm being "Pollyanna" in expecting that to happen again. History and common sense strongly suggest that it will happen again.

At the same time, I feel very badly for those less fortunate than you are and I am, because for those folks the pain is real and likely very long-lasting. Because, yes, a huge percentage of Americans who were left behind in the 1970s, 1980s, 1990s, 2000s and 2010s are still living paycheck-to-paycheck.
“It’s not how white men fight.” - Tucker Carlson

Goose

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Re: So much for inflation being "transitory"
« Reply #257 on: September 30, 2022, 11:30:23 AM »
82

I will try and send you a PM for a detailed response. Quick thoughts, in October '08 I had my oldest son transfer from MU to Madison 100% due to money. As for pandemic plunge, I shorted the S&P starting on 2/13/2020, unfortunately I continued to short daily until late May.

I think both instances were fortunate to have a scared Fed save the day. I do believe GR could have easily been a depression and I do not believe the whole pandemic plunge story has been lived out yet. IMO, what is happening now is a result of the pandemic.

JWags85

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Re: So much for inflation being "transitory"
« Reply #258 on: September 30, 2022, 11:32:58 AM »
https://www.cnbc.com/2022/09/26/whartons-siegel-says-jerome-powell-owes-the-american-people-an-apology-for-poor-fed-policy.html

Goose - folks have been living paycheck to paycheck for years with increasing numbers. Unfortunately, our government refuses to act and orgs/execs refuse to budge on monetary distribution

I thought inflation was solely due, or overwhelmingly due, to corporate greed  :o

But otherwise, as an early adoption Powell hater, I agree pretty strongly with Siegel.  The Fed is a mess and has been for some time.  They did some good short term things but I think they've sorely lacked for mid to long term strategy and perspective for Powell's entire tenure.

MU82

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Re: So much for inflation being "transitory"
« Reply #259 on: September 30, 2022, 12:19:25 PM »
82

I will try and send you a PM for a detailed response. Quick thoughts, in October '08 I had my oldest son transfer from MU to Madison 100% due to money. As for pandemic plunge, I shorted the S&P starting on 2/13/2020, unfortunately I continued to short daily until late May.

I think both instances were fortunate to have a scared Fed save the day. I do believe GR could have easily been a depression and I do not believe the whole pandemic plunge story has been lived out yet. IMO, what is happening now is a result of the pandemic.

This short answer pretty much deals with the point I was trying to make, so while I'd absolutely be interested in a longer answer from you via PM, don't feel obligated unless you want to.

When things are going on in real time (whether good or bad, but especially bad), it's normal to project greatness or horrible-ness (especially horrible-ness) for a long stretch. I am NOT trying to soft-sell what's going on now, just to try to bring in a little perspective.

I too thought the Great Recession might turn into a deep depression. I'm damn glad both of us were wrong. And I agree about the pandemic being the main culprit now.
“It’s not how white men fight.” - Tucker Carlson

Boozemon Barro

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Re: So much for inflation being "transitory"
« Reply #260 on: October 06, 2022, 12:02:21 PM »
Congress needs to get their act together and propose a depression avoidance act. I think a cool $1 trillion should do the trick.

tower912

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Re: So much for inflation being "transitory"
« Reply #261 on: October 06, 2022, 12:36:07 PM »
OPEC just decided to f the entire world.
Luke 6:45   ...A good man produces goodness from the good in his heart; an evil man produces evil out of his store of evil.   Each man speaks from his heart's abundance...

It is better to be fearless and cheerful than cheerless and fearful.

Hards Alumni

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Re: So much for inflation being "transitory"
« Reply #262 on: October 06, 2022, 12:50:18 PM »
OPEC just decided to f the entire world.

Sounds like we should introduce a little bit of freedom to em, aina?

dgies9156

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Re: So much for inflation being "transitory"
« Reply #263 on: October 06, 2022, 12:50:41 PM »
I have a different take on what's happening.

First, the Federal Government had to flood the pandemic environment with tons of money (aka, PPP). To do otherwise would have triggered a massive Depression. GOP and Dems alike agreed and this was endemic of what President Roosevelt tried to do in the 1930s. We were accepting inflation in return for keeping the economy afloat. All in all, not a bad trade-offs. I'm not sure the Fed has accepted that.

Second, we had horrible bouts of inflation in 1973 and 1979. Like today, there were shocks to the crude oil supply. While Chairman Voelcker got his arms around inflation in 1979, much of the improvement came when oil prices stabilized in the 1980s -- and we learned to live without Iran's contributions. The effect of tightening the money supply will be to make us buy less energy, with the ripple effect running through the economy.

My systematic view is get crude oil prices under control and you get inflation under control. We need to pump and refine more American crude and go back to being energy self-sufficient. We fill the void, reduce demand for imported energy and suddenly the price comes down.

Finally, gang, I like the idea of renewable energy and electric vehicles. I hope we get there. But that's off in the future. We have to deal with the problems we have now and we can solve a lot of them by investing in domestic carbon-based energy.

pacearrow02

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Re: So much for inflation being "transitory"
« Reply #264 on: October 06, 2022, 01:11:54 PM »

Hards Alumni

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Re: So much for inflation being "transitory"
« Reply #265 on: October 06, 2022, 01:13:22 PM »
I have a different take on what's happening.

First, the Federal Government had to flood the pandemic environment with tons of money (aka, PPP). To do otherwise would have triggered a massive Depression. GOP and Dems alike agreed and this was endemic of what President Roosevelt tried to do in the 1930s. We were accepting inflation in return for keeping the economy afloat. All in all, not a bad trade-offs. I'm not sure the Fed has accepted that.

Second, we had horrible bouts of inflation in 1973 and 1979. Like today, there were shocks to the crude oil supply. While Chairman Voelcker got his arms around inflation in 1979, much of the improvement came when oil prices stabilized in the 1980s -- and we learned to live without Iran's contributions. The effect of tightening the money supply will be to make us buy less energy, with the ripple effect running through the economy.

My systematic view is get crude oil prices under control and you get inflation under control. We need to pump and refine more American crude and go back to being energy self-sufficient. We fill the void, reduce demand for imported energy and suddenly the price comes down.

Finally, gang, I like the idea of renewable energy and electric vehicles. I hope we get there. But that's off in the future. We have to deal with the problems we have now and we can solve a lot of them by investing in domestic carbon-based energy.

Maybe.  We produce more oil than anyone in the world.  We consume more as well.  Of course, we fall short of our consumption considerably.

Drill baby drill isn't the answer when there is a global shortage.  We also have active sanctions on Russia and Venezuela.  Lifting those would certainly increase global supply and drive down prices... but of course with Russia that'd be a bad idea.  Sanctioning Venezuela at this point is pretty fruitless, so it'd be nice if we would lift those.

The real problem is a lack of refineries.

Quote
"Refiners turn crude oil into usable products like gasoline, diesel, and jet fuel. There's just fewer refiners in the U.S. today than a couple of years ago.

Refining capacity in the U.S. is about a million barrels a day below what it was prior to the pandemic. That's left the country unable to meet its fuel needs as more people are commuting, traveling and driving as they emerge from the throes of the pandemic."

https://www.npr.org/2022/06/26/1107265390/refinery-shortage-high-gas-prices-russia

Uncle Rico

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Re: So much for inflation being "transitory"
« Reply #266 on: October 06, 2022, 01:33:50 PM »
https://michaelshellenberger.substack.com/p/bidens-secret-promise-to-opec-backfires

We have only ourselves to blame.

This is correct.  Our dependence on oil when there are so many alternatives out there is our own fault.
“This is bar none atrocious.  Mitchell cannot shoot either.  What a pile of dung”

Lennys Tap

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Re: So much for inflation being "transitory"
« Reply #267 on: October 06, 2022, 02:34:58 PM »
This is correct.  Our dependence on oil when there are so many alternatives out there is our own fault.

I really hope this is meant as a joke.

Uncle Rico

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Re: So much for inflation being "transitory"
« Reply #268 on: October 06, 2022, 02:46:23 PM »
I really hope this is meant as a joke.

The joke is a society so blind to its ravenous consumption without a care for whether it’s sustainable or affordably prudent but I know, drill baby, drill and lay blame at the feet of anyone but ourselves
“This is bar none atrocious.  Mitchell cannot shoot either.  What a pile of dung”

dgies9156

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Re: So much for inflation being "transitory"
« Reply #269 on: October 06, 2022, 02:56:42 PM »
The real problem is a lack of refineries.

As I said: "We need to pump and refine more American crude." To refine more American crude, we need more refining capacity. That comes with investment, which has a very long-term payback and requires some type of regulatory assurance that a change in Administration isn't going to put the refinery out of business.

Brother Hards, you and I agree that perhaps someday, nothing would be better than to have strong renewable energy and electric vehicles with the same utility as internal combustion engines. I applaud the investment in both, acknowledging that my electric utility (Florida Power) is one of the largest producers of solar energy in the US. But it will take time for the innovation and production to see its way into my driveway in Vero Beach. Until then, we need crude oil and refining capacity.

Yes, we consume more. But we're a big country with a very diverse climate and landscape. And, by the way, we produce one of the highest standards of living the world has ever seen!

tower912

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Re: So much for inflation being "transitory"
« Reply #270 on: October 06, 2022, 03:46:56 PM »
Refinery capacity has been dropping for a while.   It is nearly impossible to build more refineries.  And from the oil company perspective, why?   Everyone is going to be driving electric in 15 years anyway.
Luke 6:45   ...A good man produces goodness from the good in his heart; an evil man produces evil out of his store of evil.   Each man speaks from his heart's abundance...

It is better to be fearless and cheerful than cheerless and fearful.

Pakuni

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Re: So much for inflation being "transitory"
« Reply #271 on: October 06, 2022, 04:02:37 PM »
Yes, we consume more. But we're a big country with a very diverse climate and landscape. And, by the way, we produce one of the highest standards of living the world has ever seen!

We're hardly alone here. There are places all over the planet where people are experiencing the highest standards of living ever seen. In terms of quality of life issues, we're actually behind plenty of fellow Western democracies who consume less.
And the reason we have such a high standard of living is because of people who have strived to find new and better ways to do things, not those always eager to defend the status quo.

tower912

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Re: So much for inflation being "transitory"
« Reply #272 on: October 06, 2022, 04:06:24 PM »
Lenny, what is your opinion of Babcock Ranch?
Luke 6:45   ...A good man produces goodness from the good in his heart; an evil man produces evil out of his store of evil.   Each man speaks from his heart's abundance...

It is better to be fearless and cheerful than cheerless and fearful.

4everwarriors

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Re: So much for inflation being "transitory"
« Reply #273 on: October 06, 2022, 04:18:03 PM »
First thing the Buffoon did, in office, was to make us oil dependent on the Arabs. "Nobody fooks with a Biden," hey?
"Give 'Em Hell, Al"

MUBurrow

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Re: So much for inflation being "transitory"
« Reply #274 on: October 06, 2022, 04:26:15 PM »
To tie the threads together, it would be a damn shame if the boomers shuffled off this mortal coil with a drop of crude left under the crust of an American territory.

 

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