[ASAP]

Originally Posted by Tyga11

Who says 3% inflation isn't fine? 2% is a made up number.

There is 0 talk of a pivot until there is that talk. I want you to comment on how shelter has been lagging and is now going to be going down exponentially. You missed that in your Core CPI forecast. And stop with energy also which is always volatile

isn't 3% made up as well? If we are changing historical numbers... hell make it 10% and have record profits lol.

Nothing related to housing is coming down nothing... there is nothing to back that up... a massive run up in prices with a 2-3% correction fixes nothing... rents are at an all time high.

[Tyga11]

Originally Posted by ASAP

isn't 3% made up as well? If we are changing historical numbers... hell make it 10% and have record profits lol.

Nothing related to housing is coming down nothing... there is nothing to back that up... a massive run up in prices with a 2-3% correction fixes nothing... rents are at an all time high.

Rents have been coming down for 2+ months.

https://www.washingtonpost.com/busin...-down-near-me/

I would be buying the dip in these markets (this is a stock market thread isn't it?)

[ASAP]

Originally Posted by Tyga11

Rents have been coming down for 2+ months.

https://www.washingtonpost.com/busin...-down-near-me/

I would be buying the dip in these markets (this is a stock market thread isn't it?)

all this is saying is growth has been limited not that rents are coming down... that's also regionally dependent... major markets aren't dropping

again, from your stock market perspective that always wants unfulfilled growth... no matter what the cause, you're probably in a good spot... this however is not representative of the larger economy at all... the hard reality is that that over 4 years, things have gotten massively more expensive while wages haven't kept up... this will limit spending once all of the flood money is gone

[Our03z4]

I've been investing per normal, I have 30 yrs until retirement so nothing to worry about. I have however been buying this Bitcoin dip, but it's also for the long term and only as another form of a hedge.

[dradernh]

Originally Posted by Tyga11

Energy has nothing to do with the Fed.

Higher energy prices will cause inflation to rise, possibly causing the Fed to raise interest rates.

With oil back up to $86 (at present) and the market thinking it could possibly return to $100, things are likely to remain interesting for a while yet.

[Tyga11]

Originally Posted by dradernh

Higher energy prices will cause inflation to rise, possibly causing the Fed to raise interest rates.

With oil back up to $86 (at present) and the market thinking it could possibly return to $100, things are likely to remain interesting for a while yet.

The fed isn't going to make decisions based on short term energy price...my prediction is rates will be cut in March

[other_evolved]

Originally Posted by ASAP

3% inflation is not fine... thats a revised number again because targets can't be met... just like the definition of recession was revised as were job numbers as were CPI numbers.

If you are ready for your rate cut... you need be ready for further inflation... there is 0 talk of a pivot at this time.

The definition of a recession wasn't revised, people just didn't understand the actual definition to begin with. It's generally defined by two consecutive drops in quarterly GDP, but it's not exclusively defined by that. I'm suspecting you're referencing the two consecutive drops in the first half of last year, the primary driver of which was a large decrease in government spending year-over-year. Consumption was up, wages were up, industrial production was up, etc.

Monthly BLS figures are revised at least three times by design. You can look up historical revisions going back 20+ years. There are some larger, some smaller but every month gets a few revisions.

Lastly, the 50+ year average for inflation has been just below 4%. 3% is not the end of the world based on the relatively arbitrary 2% mantra of this fed.

[ASAP]

Originally Posted by Tyga11

The fed isn't going to make decisions based on short term energy price...my prediction is rates will be cut in March

You don't think the fed is worried about some of the mistakes of the 80s where that was done and inflation came roaring back? Right now... nothing points to a pivot... in fact, the belief is another hike could come by year end.

Originally Posted by other_evolved

The definition of a recession wasn't revised, people just didn't understand the actual definition to begin with. It's generally defined by two consecutive drops in quarterly GDP, but it's not exclusively defined by that. I'm suspecting you're referencing the two consecutive drops in the first half of last year, the primary driver of which was a large decrease in government spending year-over-year. Consumption was up, wages were up, industrial production was up, etc.

Monthly BLS figures are revised at least three times by design. You can look up historical revisions going back 20+ years. There are some larger, some smaller but every month gets a few revisions.

Lastly, the 50+ year average for inflation has been just below 4%. 3% is not the end of the world based on the relatively arbitrary 2% mantra of this fed.

Let me maybe rephrase the statement or question-

What is the definition of the current situation that we are in?

Debt loads at record.
Inflation at 40 year highs.
High employment but only at the bottom of the salary payscale.
Housing at all time highs.
Spending that is unfettered due to continous government assistance.
Auto repos at record highs.

I don't think there is a term for this becauase I don't recall a time when all of the above was true at once... however, I will note that a recession to return to norms would be better than the above in the long term.

[Tyga11]

Originally Posted by ASAP

You don't think the fed is worried about some of the mistakes of the 80s where that was done and inflation came roaring back? Right now... nothing points to a pivot... in fact, the belief is another hike could come by year end.



Let me maybe rephrase the statement or question-

What is the definition of the current situation that we are in?

Debt loads at record.
Inflation at 40 year highs.
High employment but only at the bottom of the salary payscale.
Housing at all time highs.
Spending that is unfettered due to continous government assistance.
Auto repos at record highs.

I don't think there is a term for this becauase I don't recall a time when all of the above was true at once... however, I will note that a recession to return to norms would be better than the above in the long term.

You're really all over the place aren't you. What do you mean high employment but only at the bottom of the salary pay scale? High employment is literally everywhere. Wages grew something like 10% across the board last year.

Keeping rates HIGH is what's causing housing pricing to remain elevated...there's no inventory because everyone has golden handcuffs. Once rates drop, you're going to see a surge in inventory and prices are going to come back to normal.

Auto repos at all time high - link?

Debt loads are going to record out every year by the way...that's really not news. The american consumer is still in great shape.

[ASAP]

Originally Posted by Tyga11

You're really all over the place aren't you. What do you mean high employment but only at the bottom of the salary pay scale? High employment is literally everywhere. Wages grew something like 10% across the board last year.

Keeping rates HIGH is what's causing housing pricing to remain elevated...there's no inventory because everyone has golden handcuffs. Once rates drop, you're going to see a surge in inventory and prices are going to come back to normal.

Auto repos at all time high - link?

Debt loads are going to record out every year by the way...that's really not news. The american consumer is still in great shape.

Unemployment - no one and I mean no one with a white collar job who has been laid off can find another job right now... on linkedin you have 500 applications for one job. People have been searching for months including folks that I know... just because the lfpr has been spun doesn't mean there aren't major problems out there.

High rates - we are reading different economics books here... payment affordability has dropped... this is not keeping housing prices elevated, in fact its doing the opposite (or at least should be)... the moment the rates are lowered, demand will be back and prices will again go higher... literally the direct opposite of what makes sense for the housing market right now. Again - to me it looks like you are strictly looking at growth and nothing else... the fed is trying to prevent that purposely to keep prices in check... NOTHING and I mean nothing right now warrants an int rate drop... no one has even mentioned it.

auto repos - https://www.yahoo.com/lifestyle/car-...120000818.html

[bagekko]

Yeah, besides the jobs numbers being revised for the past 12 months, I still do not believe the current ones. Aug jobs were down and dummy articles wrote how surprising it was... duh it was from the revision of the past which is used to calc the recent month.

There have been so many corporate layoffs in 2023 and it is not slowing down. Agree it is difficult for those to find a new job, same as I know many laid off and difficulty searching. Many corp layoffs do not show up in unemployment as they may be on the payroll for a little post layoff and then with severance they can not apply for unemployment. I know many just laid off few weeks ago with Fortune 10 company, on the payroll till Oct and then their 4-12 month severance kicks in after.

Housing prices are definitely coming down, in the past 6 months I have seen properties we are interested on the market too long with price reductions 50-300k. The golden handcuffs applies to people without the funds to move. We will prolly move in the next 12m, rates are high, oh well we can afford it and will just refi in 1-2yrs after once the lower rates to where mortgages are 4 or sub. Commercial RE is a ticking bomb with not much time left. Many cities are looking to convert it into housing.

Consumer debt yes rises over time like prices, but it is going to rise more than normal with high rates. CC rates were low teens and for normal to bad credit people they will be mid-high 20s, that will explode their debt.

Right now I love high rates as we are getting a lot on our cash savings, which hasn't been the cash for almost 20 yrs. Skeptical how long the stock mkt is going to maintain its levels so prefer the savings.

Even though many consumer prices are slowly dropping, new cars are still outrageous but that is the manufacturers doing and oil is going to remain high until maybe spring 2024. The used market is dropping but is going to be complicated. With high rates and many people underwater on their current vehicle, its gonna be messy. Dealer lots for new are getting full, in Q4 they may be some amazing deals to move inventory by year end. Also depends on the UAW strike.

The hollywood strike is really gonna start to impact things, many media companies already have been slashing budgets before the strike. How long before advertisers start cutting things because there is no new content this fall. So much is driven by ads in traditional and digital media, potential massive snowball effect.

In the past 6 months or so the deals for household/luxury/etc items keeps growing. Some would think its an oversupply from things returning to normal, partially it may be but people are not spending like they did in 2020-22. Premium products at the super market are over stocked, people are being more frugal, unless its on sale they pick the cheapest option.

I have no idea whats going to happen in the next 3-6m or what it will be like 1 yr from now. But the economy overall is crappy and worse than the picture being painted.

Originally Posted by ASAP

Unemployment - no one and I mean no one with a white collar job who has been laid off can find another job right now... on linkedin you have 500 applications for one job. People have been searching for months including folks that I know... just because the lfpr has been spun doesn't mean there aren't major problems out there.

High rates - we are reading different economics books here... payment affordability has dropped... this is not keeping housing prices elevated, in fact its doing the opposite (or at least should be)... the moment the rates are lowered, demand will be back and prices will again go higher... literally the direct opposite of what makes sense for the housing market right now. Again - to me it looks like you are strictly looking at growth and nothing else... the fed is trying to prevent that purposely to keep prices in check... NOTHING and I mean nothing right now warrants an int rate drop... no one has even mentioned it.

auto repos - https://www.yahoo.com/lifestyle/car-...120000818.html

[ASAP]

Originally Posted by bagekko

Yeah, besides the jobs numbers being revised for the past 12 months, I still do not believe the current ones. Aug jobs were down and dummy articles wrote how surprising it was... duh it was from the revision of the past which is used to calc the recent month.

There have been so many corporate layoffs in 2023 and it is not slowing down. Agree it is difficult for those to find a new job, same as I know many laid off and difficulty searching. Many corp layoffs do not show up in unemployment as they may be on the payroll for a little post layoff and then with severance they can not apply for unemployment. I know many just laid off few weeks ago with Fortune 10 company, on the payroll till Oct and then their 4-12 month severance kicks in after.

Housing prices are definitely coming down, in the past 6 months I have seen properties we are interested on the market too long with price reductions 50-300k. The golden handcuffs applies to people without the funds to move. We will prolly move in the next 12m, rates are high, oh well we can afford it and will just refi in 1-2yrs after once the lower rates to where mortgages are 4 or sub. Commercial RE is a ticking bomb with not much time left. Many cities are looking to convert it into housing.

Consumer debt yes rises over time like prices, but it is going to rise more than normal with high rates. CC rates were low teens and for normal to bad credit people they will be mid-high 20s, that will explode their debt.

Right now I love high rates as we are getting a lot on our cash savings, which hasn't been the cash for almost 20 yrs. Skeptical how long the stock mkt is going to maintain its levels so prefer the savings.

Even though many consumer prices are slowly dropping, new cars are still outrageous but that is the manufacturers doing and oil is going to remain high until maybe spring 2024. The used market is dropping but is going to be complicated. With high rates and many people underwater on their current vehicle, its gonna be messy. Dealer lots for new are getting full, in Q4 they may be some amazing deals to move inventory by year end. Also depends on the UAW strike.

The hollywood strike is really gonna start to impact things, many media companies already have been slashing budgets before the strike. How long before advertisers start cutting things because there is no new content this fall. So much is driven by ads in traditional and digital media, potential massive snowball effect.

In the past 6 months or so the deals for household/luxury/etc items keeps growing. Some would think its an oversupply from things returning to normal, partially it may be but people are not spending like they did in 2020-22. Premium products at the super market are over stocked, people are being more frugal, unless its on sale they pick the cheapest option.

I have no idea whats going to happen in the next 3-6m or what it will be like 1 yr from now. But the economy overall is crappy and worse than the picture being painted.

this is the hard reality and it's a reality few are seeing for some reason... there is some pictured that is painted of the broad market led by wall street and it's not tranlasting down to reality


i am interested in buying another house... there are some deals to be had in my area and the builders can buy down rates but not sure if its a good time due to entirely uncertain economic factors

[G35POPPEDMYCHERRY]

Originally Posted by ASAP

this is the hard reality and it's a reality few are seeing for some reason... there is some pictured that is painted of the broad market led by wall street and it's not tranlasting down to reality


i am interested in buying another house... there are some deals to be had in my area and the builders can buy down rates but not sure if its a good time due to entirely uncertain economic factors

well they don't see and wall street will fool them and bleed them dry once the fall comes

[dradernh]

Originally Posted by Tyga11

The fed isn't going to make decisions based on short term energy price...my prediction is rates will be cut in March

I think your crystal ball is a lot larger than mine. If you'd care to share, how much have you bet on your prediction?

[Tyga11]

Originally Posted by ASAP

Unemployment - no one and I mean no one with a white collar job who has been laid off can find another job right now... on linkedin you have 500 applications for one job. People have been searching for months including folks that I know... just because the lfpr has been spun doesn't mean there aren't major problems out there.

High rates - we are reading different economics books here... payment affordability has dropped... this is not keeping housing prices elevated, in fact its doing the opposite (or at least should be)... the moment the rates are lowered, demand will be back and prices will again go higher... literally the direct opposite of what makes sense for the housing market right now. Again - to me it looks like you are strictly looking at growth and nothing else... the fed is trying to prevent that purposely to keep prices in check... NOTHING and I mean nothing right now warrants an int rate drop... no one has even mentioned it.

auto repos - https://www.yahoo.com/lifestyle/car-...120000818.html

Look up the new report that shows shelter is down >1% YoY...came out today.

You don't have a good understanding of the home market

[bagekko]

Does anyone know if the CPI somehow considers shrinkflation? If not then inflation is seriously off, its higher than reported. I just found an example a few weeks ago. Was looking at pop secret microwave popcorn, noticed two slightly different boxes, looked at the details. One box had 3.2oz bags and the other was 3.0oz, might not seem like a lot, but that is a 6.25% reduction, which means the price rose 6.67%.

Interesting problem if popcorn shrinks any further, my microwave auto senses for 3.0-3.5oz bags, it might not pop sub 3oz bags well. I think 3.5oz bags disappeared long before my microwave was made, about 5yrs ago.

[ASAP]

Originally Posted by bagekko

Does anyone know if the CPI somehow considers shrinkflation? If not then inflation is seriously off, its higher than reported. I just found an example a few weeks ago. Was looking at pop secret microwave popcorn, noticed two slightly different boxes, looked at the details. One box had 3.2oz bags and the other was 3.0oz, might not seem like a lot, but that is a 6.25% reduction, which means the price rose 6.67%.

Interesting problem if popcorn shrinks any further, my microwave auto senses for 3.0-3.5oz bags, it might not pop sub 3oz bags well. I think 3.5oz bags disappeared long before my microwave was made, about 5yrs ago.

My understanding is that it is not captured in the CPI number... which sets off another variable. I can't even find the food components that are included in the CPI number... it just says general basket. That's why these numbers are rarely treated as reliable.

[bagekko]

Some things are simple like a gallon or milk, dozen eggs, pound of meat... Though it feels like the eggs in L & XL are smaller, but isn't the criteria set by some industry, though they could of changed it and we wouldn't know. Cereal boxes have all shrunk, frozen pizza sizes, canned goods. The only thing that hasn't shrunk is 2L and can of soda, they are so exp these days eventually they have to shrink.

Originally Posted by ASAP

My understanding is that it is not captured in the CPI number... which sets off another variable. I can't even find the food components that are included in the CPI number... it just says general basket. That's why these numbers are rarely treated as reliable.

[dradernh]

Originally Posted by ASAP

I can't even find the food components that are included in the CPI number... it just says general basket.

This page might help: https://www.bls.gov/news.release/cpi.t02.htm.

[ASAP]

Where is Tyga at? lol

https://www.cnbc.com/2023/09/13/cpi-...ust-2023-.html

[bimmer_ott]

Originally Posted by ASAP

Where is Tyga at? lol

https://www.cnbc.com/2023/09/13/cpi-...ust-2023-.html

I guess the persist inflation may probably come from the rental market. Landlords in Canada have been increasing monthly rent (up 9..6% since last August), the justification is their mortgage payments have been increased due to interest rate hike.

[TboneS54]

Originally Posted by Tyga11

Keeping rates HIGH is what's causing housing pricing to remain elevated...there's no inventory because everyone has golden handcuffs. Once rates drop, you're going to see a surge in inventory and prices are going to come back to normal.

I'm actively in the market right now. It seems low inventory (mostly due to the golden handcuffs you mention) are what are keeping prices pretty high. The 20 year high rates are making prices drop just a tiny bit. When rates get cut (they won't go down to the 3% range every homeowner has right now), I expect prices to RISE, not fall. More people qualifying, more competition, same low inventory.

I've sold high, hope to find the next house as prices are slowing coming down (it's very sideways right now, but some price cuts) but before rates would be cut and prices shoot up. My criteria for a house is very specific, so I may be waiting a while with such low inventory :/