Inflation

[Petethreeput]

2 minutes ago, me05501 said:

 

 

We aren’t in a recession. A recession is a very specific situation defined by two or more consecutive quarters of negative GDP. 
 

We’re in a bear market for both stocks and bonds, and we’re suffering from high inflation, but we aren’t in a recession. 

 

My mistake.  Illustrative if the news cycle I bemoan.  Yes, you are correct, but the news implies we are in one. Poor word choice.

[Soloman1]

Majority of small businesses report their rent has increased by ~20% in the last seven months - hardly a supply chain issue, since they have a glut of open space. Simply squeezing the last tenants for more.

 

37% of small businesses report they could not pay their rent for the month of October.

 

Not good trends.

[smashdn]

1 hour ago, Soloman1 said:

Majority of small businesses report their rent has increased by ~20% in the last seven months - hardly a supply chain issue, since they have a glut of open space. Simply squeezing the last tenants for more.

 

37% of small businesses report they could not pay their rent for the month of October.

 

Not good trends.

 

Increasing prices impact landlords as well.  

[Soloman1]

1 minute ago, smashdn said:

Increasing prices impact landlords as well.

 

 

Curious what would increase commercial landlord costs of 20%. Educate me!

[smashdn]

Well, if they are large enough to have employees (property management type outfits) they are likely paying higher wages and now taxes on those wages, insurance, fuel, etc.  Property taxes keep rising here.  Plus on a people level, a landlord needs medical care, groceries and other things as well.

[Soloman1]

Commercial real estate companies are permanently cutting employees in this part of the country, in addition to cutting marketing budgets.

 

Most all states limit commercial real estate assessment increases to 2% or less and most assessments are only done every 5-10 years. Is that wrong?

 

I don't know anyone getting higher wages other than measly annual increases in the 2-3% range.

 

Tenants are paying more in taxes on rent. Good thing they don't have to buy groceries, medical care . . . 🙂

 

I'm still not convinced, but willing to be convinced. 

[ThinkingPlus]

I blame economic inflation on Guttenberg and P. T. Barnum.

 

I am still hoping we switch to talking about cosmological inflation. Much harder to get a "why" answer there.  LOL.

[Krt22]

7 hours ago, me05501 said:

 

 

We aren’t in a recession. A recession is a very specific situation defined by two or more consecutive quarters of negative GDP. 
 

We’re in a bear market for both stocks and bonds, and we’re suffering from high inflation, but we aren’t in a recession. 

 

Q1-1.6% drop in GDP

Q2-0.6% drop in GDP

Q3-2.6% increase in GDP

 

So we were technically in a recession, briefly

[me05501]

7 minutes ago, Krt22 said:

Q1-1.6% drop in GDP

Q2-0.6% drop in GDP

Q3-2.6% increase in GDP

 

So we were technically in a recession, briefly

 

 

I wonder whether they wait on revised numbers or not...pretty sure that second quarter print was revised higher. In any case if the government had officially declared a recession we could at least stop worrying over whether or not we'll have one in '23. 

 

It's a trailing indicator anyway. Markets always bottom before a recession is recognized. 

[Krt22]

3 minutes ago, me05501 said:

 

 

I wonder whether they wait on revised numbers or not...pretty sure that second quarter print was revised higher. In any case if the government had officially declared a recession we could at least stop worrying over whether or not we'll have one in '23. 

 

It's a trailing indicator anyway. Markets always bottom before a recession is recognized. 

Those numbers are straight from the government's website. It was never declared a recession for reasons we are not allowed to discuss on here, but every professional and armchair economist had no issues calling a spade a spade.

 

https://www.bea.gov/data/gdp/gross-domestic-product

[Soloman1]

And let’s not leave out quantum entanglement, since it’s all the rage with the Nobel Prize.

 

I read today that food companies and most restaurants are making record profits, far beyond cost increases. They say they’ll raise prices more, since consumers are “accepting” the increases.

 

The toothpaste folks are talking about raising the smaller tubes you get now to $10 per tube. To paraphrase one CEO, what are consumers going to do, not brush their teeth if we all raise prices?

 

Clothing brands are still getting product from China at $4-$9 landed even with higher transportation costs. For example, women’s dresses for $9 landed went from $110 retail to $180 retail. Purses at $9.50 landed went from $120 to $200 retail.

 

It’s just mob mentality.

 

I live in the city metro area with the highest inflation in the US, so I go to the supermarket early in the morning and try to stay ahead of the crews changing prices. Gotta get that little, brown head of lettuce before it goes up from $1.99 each. 🙂

 

[ThinkingPlus]

7 minutes ago, Soloman1 said:

And let’s not leave out quantum entanglement, since it’s all the rage with the Nobel Prize.

 

I read today that food companies and most restaurants are making record profits, far beyond cost increases. They say they’ll raise prices more, since consumers are “accepting” the increases.

 

The toothpaste folks are talking about raising the smaller tubes you get now to $10 per tube. To paraphrase one CEO, what are consumers going to do, not brush their teeth if we all raise prices?

 

Clothing brands are still getting product from China at $4-$9 landed even with higher transportation costs. For example, women’s dresses for $9 landed went from $110 retail to $180 retail. Purses at $9.50 landed went from $120 to $200 retail.

 

It’s just mob mentality.

 

I live in the city metro area with the highest inflation in the US, so I go to the supermarket early in the morning and try to stay ahead of the crews changing prices. Gotta get that little, brown head of lettuce before it goes up from $1.99 each. 🙂

 

The quantum entanglement experimental work is old (Nobel committee runs everything thru a very, very low frequency filter), but very important news.  Finally demonstrating Bell's Inequality so convincingly pretty much put the final nail into the hidden variables coffin. We still don't know what quantum mechanics means or even if that is a valid question to ask, but we are now sure that determinism is foolish to chase at any level. So we got that going for us...

[Lobby]

Natural gas is over $6 / mm btu right now.   That's caused by the war in Ukraine, and us sending LNG to the rest of the world.

That's made our (U.S.) electricity prices go up. 

Y'all want lower electricity bills?   Make sure Putin loses power.

[bladehunter]

4 hours ago, Krt22 said:

Q1-1.6% drop in GDP

Q2-0.6% drop in GDP

Q3-2.6% increase in GDP

 

So we were technically in a recession, briefly

Yep.  Nail on the head.  

[jerebear21]

8 hours ago, Soloman1 said:

 

 

Curious what would increase commercial landlord costs of 20%. Educate me!

 

I can answer this specifically on my end. It does not indicate whether other landlords are going through the same.  Property tax, property insurance and liability insurance have gone off the roof.  But the one thing that I've seen personally has been cost of maintenance. Cost of labor associated with maintenance and material are about 100% more than what it was pre-pandemic.  

 

We are in a recession by definition.  Doesn't feel like it since majority of private balances are still too high.  

Edited November 2, 2022 by jerebear21

[Wooley12]

 The war with it's global economic impacts has to be a big factor in the global inflation and one that was missing in previous recessions. Seems there are always Winners and Losers with inflation. One mans record profits from consumers is another man's cost at the pump. Landlords increased cost for maintenance is more money for who supplies it. And the laws of supply and demand rule. Not enough people to swing a hammer to meet demand and the labor price goes up. Full disclosure. After a full year of skipping most classes, I earned a B for my oral final in a MBA Macro class with a dissertation on the law of supply and demand so I go there first in looking at economic issues. I could be biased. 

[bladehunter]

9 hours ago, Wooley12 said:

 The war with it's global economic impacts has to be a big factor in the global inflation and one that was missing in previous recessions. Seems there are always Winners and Losers with inflation. One mans record profits from consumers is another man's cost at the pump. Landlords increased cost for maintenance is more money for who supplies it. And the laws of supply and demand rule. Not enough people to swing a hammer to meet demand and the labor price goes up. Full disclosure. After a full year of skipping most classes, I earned a B for my oral final in a MBA Macro class with a dissertation on the law of supply and demand so I go there first in looking at economic issues. I could be biased. 

Good points.  But as a contractor myself ( not a home contractor ) I can say.  It’s not record profits on this end . It’s record costs.  I don’t know where the record profits migrates  up to , but it’s higher than the head of the person doing the repairs.    It must be either at the lumber mill level , or higher stilll at the investor level for those  who’ve been into materials futures for the long term. 
 

having said that , I know that bubble just burst as well.  Lumber prices are much lower at this moment , than say late 2020.  

Edited November 2, 2022 by bladehunter

[Krt22]

7 hours ago, bladehunter said:

Good points.  But as a contractor myself ( not a home contractor ) I can say.  It’s not record profits on this end

Despite all the current rhetoric of record profits, I agree that really isn't the case at a boarder level. There may be a handful of industries experiencing this, but for everyone else that simply is not the case. 

 

How much something costs ultimately is governed by how much someone is willing to pay. When free or nearly free money is infused at every single level of the economy, this was bound to happen.  When everyone has more money in their pocket, everyone becomes more willing to pay more for the same thing. When things are in short supply, they pay even more. Until people cannot or will not pay a certain amount, price of goods will remain inflated. 

 

It is very clear prices are softening in many segments (electronics, consumer goods, housing, etc). But when it comes to energy, food and food service,  the time to correct is going to be much longer. In the food service industry I am not sure it will ever happen, labor prices have gone up, supplier costs have gone up, rent has gone up, basically they have no room to correct. If they cannot succeed at a certain price level, they will simply fold. 

[bladehunter]

52 minutes ago, Krt22 said:

Despite all the current rhetoric of record profits, I agree that really isn't the case at a boarder level. There may be a handful of industries experiencing this, but for everyone else that simply is not the case. 

 

How much something costs ultimately is governed by how much someone is willing to pay. When free or nearly free money is infused at every single level of the economy, this was bound to happen.  When everyone has more money in their pocket, everyone becomes more willing to pay more for the same thing. When things are in short supply, they pay even more. Until people cannot or will not pay a certain amount, price of goods will remain inflated. 

 

It is very clear prices are softening in many segments (electronics, consumer goods, housing, etc). But when it comes to energy, food and food service,  the time to correct is going to be much longer. In the food service industry I am not sure it will ever happen, labor prices have gone up, supplier costs have gone up, rent has gone up, basically they have no room to correct. If they cannot succeed at a certain price level, they will simply fold. 

Agree on all fronts.   

[bladehunter]

On 10/27/2022 at 10:23 AM, me05501 said:

 

If this is true, your wife might be the world's worst investor. The S&P 500 has tripled since 2012. An all-bond portfolio could be lower after this year but just about anything else should be up if left alone for the last ten years. 

Thought of this comment as I read that the average 401k has dropped $34k since first quarter 2021 . Which is roughly 25% of the average 401k balance.  
 

im not a person who claims to be an investment guru.  I admit to working my entire 30s away with no thought of it.  Various reasons that nobody wants to hear.  
 

but …. I don’t understand how this fact  jives with your comment.  Are you saying the overall should still be “ up “ because of previous gains ?    Maybe so by a small Margin.  I’d have to dig up records to see.  But I don’t think the idea is to break even after 10 years. Right ?  Once you factor what the dollar will buy today it’s breaking even at best , right ? Using the old metric inflation is close to 13-15 % …9 or so with todays revised metric… that wipes out the margin of gain if there is one. No ? 

Edited November 9, 2022 by bladehunter

[me05501]

33 minutes ago, bladehunter said:

Thought of this comment as I read that the average 401k has dropped $34k since first quarter 2021 . Which is roughly 25% of the average 401k balance.  
 

im not a person who claims to be an investment guru.  I admit to working my entire 30s away with no thought of it.  Various reasons that nobody wants to hear.  
 

but …. I don’t understand how this fact  jives with your comment.  Are you saying the overall should still be “ up “ because of previous gains ?    Maybe so by a small Margin.  I’d have to dig up records to see.  But I don’t think the idea is to break even after 10 years. Right ?  Once you factor what the dollar will buy today it’s breaking even at best , right ? Using the old metric inflation is close to 13-15 % …9 or so with todays revised metric… that wipes out the margin of gain if there is one. No ? 

 

This year has been rough, but the last ten years have not. Terms of my employment prevent me from getting into more detail than that, unfortunately. 😕

[ThinkingPlus]

36 minutes ago, bladehunter said:

Thought of this comment as I read that the average 401k has dropped $34k since first quarter 2021 . Which is roughly 25% of the average 401k balance.  
 

im not a person who claims to be an investment guru.  I admit to working my entire 30s away with no thought of it.  Various reasons that nobody wants to hear.  
 

but …. I don’t understand how this fact  jives with your comment.  Are you saying the overall should still be “ up “ because of previous gains ?    Maybe so by a small Margin.  I’d have to dig up records to see.  But I don’t think the idea is to break even after 10 years. Right ?  Once you factor what the dollar will buy today it’s breaking even at best , right ? Using the old metric inflation is close to 13-15 % …9 or so with todays revised metric… that wipes out the margin of gain if there is one. No ? 

I show good growth across the board over a 10 year period.  However, the last year (the peak was Dec. 2021) has been pretty ugly down 10% - 15% or so.  I have fairly conservative investments.  My 401(k) is mostly in an income fund at 2% or so (very safe).  I am funding myself right now off the 401(k) so hard to quickly figure growth.  The rest of my stuff is in the market or bonds that are standard kinds of investments.  Some is managed, some is me spitballing.  

[bladehunter]

1 hour ago, ThinkingPlus said:

I show good growth across the board over a 10 year period.  However, the last year (the peak was Dec. 2021) has been pretty ugly down 10% - 15% or so.  I have fairly conservative investments.  My 401(k) is mostly in an income fund at 2% or so (very safe).  I am funding myself right now off the 401(k) so hard to quickly figure growth.  The rest of my stuff is in the market or bonds that are standard kinds of investments.  Some is managed, some is me spitballing.  

Yes ma’am.  That’s pretty much what she’s seen.  I will readily admit it’s also a very conservative choice of package.  And hasn’t nearly grown to the level that was described earlier in this thread , and surely  due to its very conservative choices.  I honestly never paid attention until she started showing me the balance decline.  She has one that’s state retirement from her 20s and one that’s at her current employer which she’s been at 12 years.  The state one hasn’t lost as much.  But it has lost some gains.  I’d have to get her to pull it back out to see exactly how much.  
 

I suppose the lesson is being to conservative in good times doesn’t make enough to weather the bad years without eating principle.     I tried to tell her to follow me and buy land instead.   But that’s another story. Lol.  We were both kids and had no backing to show us when we set our.  So I guess it’s a miracle we did this well on dumb luck.  
 

anywho. It’s just a curiosity to me how some can act like folks aren’t losing money.  

[bladehunter]

1 hour ago, me05501 said:

 

This year has been rough, but the last ten years have not. Terms of my employment prevent me from getting into more detail than that, unfortunately. 😕

😂.  Man.  Why did I know this is what the response would look like ?    You’re a good egg. So I’m just not going to poke further. 

[bscinstnct]

I don’t get why pork is still so cheap 

 

Like good pork. This butcher here sell these pork loin chops, all natural blah blah, delicious with just salt and pepper, sear and quick bake. Actually preferring them to steak.

 

Be like $3.50 a pound or something. Meantime I paying like $40/pound for halibut!

 

Apples and oranges comparison,  I know, and obviously supply and demand driven. But sometimes I wonder if people think pork is bad for you or something. 
 

But here what WebMD say!

 

“Lean pork is every bit as good for your body as lean beef and chicken. In one study, substituting lean pork for beef and chicken led to less body fat and better heart health. “
 

https://www.webmd.com/food-recipes/ss/slideshow-the-truth-about-chicken

 

 

 

 

 

[me05501]

2 hours ago, bladehunter said:

😂.  Man.  Why did I know this is what the response would look like ?    You’re a good egg. So I’m just not going to poke further. 

 

Sorry man. Not worth getting canned over! 🙂

 

[me05501]

1 hour ago, bscinstnct said:

I don’t get why pork is still so cheap 

 

Like good pork. This butcher here sell these pork loin chops, all natural blah blah, delicious with just salt and pepper, sear and quick bake. Actually preferring them to steak.

 

Be like $3.50 a pound or something. Meantime I paying like $40/pound for halibut!

 

Apples and oranges comparison,  I know, and obviously supply and demand driven. But sometimes I wonder if people think pork is bad for you or something. 
 

But here what WebMD say!

 

“Lean pork is every bit as good for your body as lean beef and chicken. In one study, substituting lean pork for beef and chicken led to less body fat and better heart health. “
 

https://www.webmd.com/food-recipes/ss/slideshow-the-truth-about-chicken

 

 

 

 

 

 

I'm pretty sure pork is cheaper than fish because we know exactly where the pigs are. 🙂

 

Without doing a lick of research I'll speculate that pork is cheaper than beef because pigs can be grown to slaughtering size faster and cheaper than cows can. 

 

[bladehunter]

2 hours ago, bscinstnct said:

I don’t get why pork is still so cheap 

 

Like good pork. This butcher here sell these pork loin chops, all natural blah blah, delicious with just salt and pepper, sear and quick bake. Actually preferring them to steak.

 

Be like $3.50 a pound or something. Meantime I paying like $40/pound for halibut!

 

Apples and oranges comparison,  I know, and obviously supply and demand driven. But sometimes I wonder if people think pork is bad for you or something. 
 

But here what WebMD say!

 

“Lean pork is every bit as good for your body as lean beef and chicken. In one study, substituting lean pork for beef and chicken led to less body fat and better heart health. “
 

https://www.webmd.com/food-recipes/ss/slideshow-the-truth-about-chicken

 

 

 

 

 

Side note on halibut.  
 

my last name is Hall. My wife once bought a mustang and thought it would be funny in her warped sense of humor to get a personalized plate that said “ HallA**”.  Sort of a double entendres.  Well.  Apparently in South Carolina you can’t put an expletive on your plate.  I swear to goodness they sent back “ Hallbut ”  without any note or consultation at all.  I can prove it too as we still own the plate.    So she has a cousin who absolutely is brilliant on one hand snd sooooo ditzy on another. I’m talking Georgetown educated attorney who works in DC as a named partner.  And she said this when she saw the plate “ Halibut ?   Man. You have to be a huge fan of a single fish to put it on your car plate “…. She said this serious as a heart attack.   
 

I couldn’t stand up I was laughing so hard.  I’m sure that all qualifys as dad joke of the year. But it’s a really real and true story. 
 

so that car is named halibut.  We still own it. We call it that to this day. That was 17 or so years ago. 

[bscinstnct]

1 hour ago, bladehunter said:

Side note on halibut.  
 

my last name is Hall. My wife once bought a mustang and thought it would be funny in her warped sense of humor to get a personalized plate that said “ HallA**”.  Sort of a double entendres.  Well.  Apparently in South Carolina you can’t put an expletive on your plate.  I swear to goodness they sent back “ Hallbut ”  without any note or consultation at all.  I can prove it too as we still own the plate.    So she has a cousin who absolutely is brilliant on one hand snd sooooo ditzy on another. I’m talking Georgetown educated attorney who works in DC as a named partner.  And she said this when she saw the plate “ Halibut ?   Man. You have to be a huge fan of a single fish to put it on your car plate “…. She said this serious as a heart attack.   
 

I couldn’t stand up I was laughing so hard.  I’m sure that all qualifys as dad joke of the year. But it’s a really real and true story. 
 

so that car is named halibut.  We still own it. We call it that to this day. That was 17 or so years ago. 

 

Classic story 🤣

 

How you guys think they gonna put *ss on a license plate ?!

 

And wonder if the guy who made the Halibut plate did it to mess with you!

 

Blade be like

 

 

[Soloman1]

Exports of pork to China have dropped, so there’s ample supply.