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  1. #151
    Mr. John Wayne CosmicCowboy's Avatar
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    I know I am getting price increases from vendors almost daily averaging around 8%. I'm not predicting "hyper" inflation, but inflation is real. Historically the Fed has tried to keep interest rates about 100 basic points over the inflation rate. Even if inflation "only" jumps to a sustained rate of 4% and interest rates hit 5% it will really suck. Federal tax revenue fir 2021 is estimated to be 3.8 trillion. 5% interest on the existing debt would literally take half of tax revenues...With a six trillion budget we would be adding 5 trillion of debt every year with the corresponding increase in debt service cost. Ultimately, all tax revenue would be going just to pay interest.

  2. #152
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    It Gets Ugly:

    Dollar’s Purchasing Power Plunged at Fastest Pace since 1982.

    It’s “Permanent” not “Temporary,” Won’t Bounce Back






    https://wolfstreet.com/2021/06/10/it...t-bounce-back/

  3. #153
    Frumious Bandersnatch RandomGuy's Avatar
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    I know I am getting price increases from vendors almost daily averaging around 8%. I'm not predicting "hyper" inflation, but inflation is real. Historically the Fed has tried to keep interest rates about 100 basic points over the inflation rate. Even if inflation "only" jumps to a sustained rate of 4% and interest rates hit 5% it will really suck. Federal tax revenue fir 2021 is estimated to be 3.8 trillion. 5% interest on the existing debt would literally take half of tax revenues...With a six trillion budget we would be adding 5 trillion of debt every year with the corresponding increase in debt service cost. Ultimately, all tax revenue would be going just to pay interest.
    Real, but no one expects it to be sustained. People are sitting on cash, and any shortfall in supply will find funds easy to get for investments in increasing the supply curve.

    Consensus is that inflation will drop back down to recent historical ranges within a year or so.

  4. #154
    Frumious Bandersnatch RandomGuy's Avatar
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    Biden stole the election.
    muh Big Lie

    Cry harder. Getting more votes than the other guy is the definition of NOT stealing an election. Keep smearing that manure on your face.

  5. #155
    notthewordsofonewhokneels Thread's Avatar
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    muh Big Lie

    Cry harder. Getting more votes than the other guy is the definition of NOT stealing an election. Keep smearing that manure on your face.
    The manure tact, eh?

  6. #156
    Frumious Bandersnatch RandomGuy's Avatar
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    The manure tact, eh?
    Losers in elections did not have that election "stolen" from them.

    There really was no fraud, isolated cases excepted.

    If there were a fraud on a scale large enough to change the outcome, it would be easily proved.

    What's funny is that the lawyers you think were going to conclusively prove this mythological event didn't try to argue that they had evidence of it in court.

    Why is that?

  7. #157
    notthewordsofonewhokneels Thread's Avatar
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    Losers in elections did not have that election "stolen" from them.

    There really was no fraud, isolated cases excepted.

    If there were a fraud on a scale large enough to change the outcome, it would be easily proved.

    What's funny is that the lawyers you think were going to conclusively prove this mythological event didn't try to argue that they had evidence of it in court.

    Why is that?
    Just giving you all a hard row to hoe, like you done President Trump. You're safe, RG, ain't like when President Trump got sworn and drove over to the White House only to find out that your side had threatened to blow the damn place up. You're okay.

    Signed,
    The *"embarrassment, sick, chump" that voted for President Trump.

    *mother er Biden's citations for his fellow Americans.

  8. #158
    dangerous floater Winehole23's Avatar
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    because they had no evidence of fraud

  9. #159
    notthewordsofonewhokneels Thread's Avatar
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    because they had no evidence of fraud
    Just giving you all a taste of your medicine.

    Stings, don't it?

    ha, ha.

  10. #160
    dangerous floater Winehole23's Avatar
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    Just giving you all a taste of your medicine.

    Stings, don't it?
    not at all, y'all are beclowning yourselves

  11. #161
    notthewordsofonewhokneels Thread's Avatar
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    not at all, y'all are beclowning yourselves
    You guys did the exact same thing for Trump's entire presidency. You have this coming, just shut up and take it.

  12. #162
    dangerous floater Winehole23's Avatar
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    You guys did the exact same thing for Trump's entire presidency. You have this coming, just shut up and take it.
    I didn't, tbh.

    I congratulated Trump for the historic, astounding win in 2016 and have said he won fair and square ever since.

  13. #163
    notthewordsofonewhokneels Thread's Avatar
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    I know, I can't find anybody who will own up to it. Same with Hillary. Can't find a soul who voted for her.

  14. #164
    dangerous floater Winehole23's Avatar
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    I know, I can't find anybody who will own up to it. Same with Hillary. Can't find a soul who voted for her.
    you're welcome to repost anything by me saying the 2016 election was stolen, by the Russians or anyone else.

    you won't because there isn't any such post.

  15. #165
    notthewordsofonewhokneels Thread's Avatar
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    you're welcome to repost anything by me saying the 2016 election was stolen, by the Russians or anyone else.

    you won't because there isn't any such post.
    You're in bed with 'em, Wiinester...guilt by association. Get out of their bed!!!

  16. #166
    dangerous floater Winehole23's Avatar
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    You're in bed with 'em, Wiinester...guilt by association. Get out of their bed!!!
    guilt by association is a logal fallacy, but it is rhetorically effective.

    you're all propaganda, all the time.

  17. #167
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    Used cars have gone up so much that it doesn't make sense to buy used anymore. Just look for manufacturer's rebate, buy lightly used "service" NEW vehicle from dealer. Been looking at cars for the past 15 months (for kids) and it is astounding how much prices have gone up.

    But pretty much the same for restaurant and house prices.

  18. #168
    Frumious Bandersnatch RandomGuy's Avatar
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    Used cars have gone up so much that it doesn't make sense to buy used anymore. Just look for manufacturer's rebate, buy lightly used "service" NEW vehicle from dealer. Been looking at cars for the past 15 months (for kids) and it is astounding how much prices have gone up.

    But pretty much the same for restaurant and house prices.
    cars, like houses, have to increase in number as the population increases.

    If either doesn't for a period of time, then supply/demend will drive the price point up.

    cars, unlike houses, have an appreciable % of them additionally wear out or totaled out to accidents/weather.

    We are seeing that supplly/demand mismatch, as the demand is way more flexible/variable than supply.

    My thoughts: one might expect car insurance rates to creep up to match in the next year. With blue book values likely higher than many rate structures were anticipating, their loss ratios will be higher, leading to a desire to increase rates to maintain profitability. Be interesting to pose the question to the actuarial dept.

  19. #169
    Frumious Bandersnatch RandomGuy's Avatar
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    Yup, I would fully expect to see severity (average cost of a given claim) go up as used car prices increase. Same thing on the homeowners side as building supplies are skyrocketing.
    Good point on the building supplies thing, forgot about that.

  20. #170
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    Austin-area median home prices hit all-time high in May

    In the Austin-Round Rock metropolitan statistical area,

    home prices jumped 48% year over year

    for 3,976 and the median home price increased 42.2% to the record number.

    Sales dollar volume increased 116.2% year over year to more than $2.3 billion, and housing inventory fell to just half a month.



    https://www.kxan.com/news/local/aust...e-high-in-may/

    Building cost of home construction up about 25%

  21. #171
    🏆🏆🏆🏆🏆 ElNono's Avatar
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    Lumber prices dive more than 40% in June, biggest monthly drop on record

    - Lumber futures have tanked 42% in June alone, on pace for their worst month on record dating back to 1978.
    - The building commodity is down more than 13% in 2021, headed for the first negative first half since 2015.
    - The quick reversal of lumber’s monthslong rally came as Americans started to go on vacations again instead of taking on renovation and building projects.
    - Many who are fearful of persistent inflation also took comfort in the drastic decline in prices in the face of cooling demand.

    The great lumber bubble of 2021 has popped.

    After a jaw-dropping rally this spring, lumber prices have come back down to earth as supply increased, speculative trading action cooled and homebuilding demand eased. Lumber futures have tanked 42% in June alone, on pace for their worst month on record back to 1978. The building commodity is down more than 13% in 2021, headed for the first negative first half since 2015.

    At its peak on May 7, lumber prices hit an all-time high of $1,670.50 per thousand board feet on a closing basis, which was more than six times higher than its pandemic low in April 2020.

    The quick reversal of lumber’s monthslong rally came as Americans started to go on vacations again amid the economic reopening instead of taking on renovation and building projects. Many who are fearful of persistent inflation also took comfort in the drastic decline in prices in the face of cooling demand.

    “This drop suggests that the cause of that inflation—the mismatch of supply and demand—will not last forever,” said Brad McMillan, CIO at Commonwealth Financial Network. “As suppliers across industries get their acts together, those shortages will fade, along with the inflation. That looks to be happening for lumber now and will happen for other inputs later.”

    https://www.cnbc.com/2021/06/30/lumb...on-record.html

  22. #172
    Frumious Bandersnatch RandomGuy's Avatar
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    “This drop suggests that the cause of that inflation—the mismatch of supply and demand—will not last forever,” said Brad McMillan, CIO at Commonwealth Financial Network. “As suppliers across industries get their acts together, those shortages will fade, along with the inflation. That looks to be happening for lumber now and will happen for other inputs later.”

    https://www.cnbc.com/2021/06/30/lumb...on-record.html
    Price of lumber, like other things, will bounce around a bit until it gets to a more stable equilibrium point.

    I expect housing to do something similar.

  23. #173
    dangerous floater Winehole23's Avatar
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    Intersting article.

    What if inflation isn't a purely monetary phenomenon, but politically influenced too?

    Economists lack a good understanding of what causes inflation. In introductory macroeconomics curricula, the mantra of Milton Friedman remains central: “inflation is always a monetary phenomenon.” By this, Friedman meant that excessive price growth happens when a state loosens the supply of money, thus over-expanding the monetary base. But recent research has brought this popular doctrine into question. While expanding the money supply seems to be a necessary condition for uncontrolled inflation to occur, it is not sufficient: increases of the monetary base have occurred without any inflationary episodes, and inflationary episodes have happened with only very small increases in monetary base.


    Contra Friedman, Hirschman suggested that uncontrolled inflation is primarily a political phenomenon that occurs when groups compete over resources. The rapid increase of the price level is a signal that the state can no longer control this compe ion. What exactly happened in the waning decades of the twentieth century, and why do the ghosts of inflation still haunt our economic and political reality?


    Hyman Minsky’s writings on the collapse of the so-called golden age of capitalism offer some insight by forcing us to engage with how distributive struggles have driven the inflationary and deflationary cycles of the past fifty years. In doing so, we can construct an account of the political economy underpinning the “deflationary coalition” that rules the common sense of our economic policymakers and the policy they write—and the path to a new one.
    https://phenomenalworld.org/analysis...tion-inflation

  24. #174
    dangerous floater Winehole23's Avatar
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    To deal with stagflation, governments transitioned to a system which Minsky labeled “money manager capitalism.” This new system was marked by a rapid deregulation of finance and the creation of an economy in which managers of large concentrations of privately-created credit money met credit commitments through quick returns on investment. As a system, it was less stable and more anemic than its big government predecessor, but also less prone to inflation. Importantly, the latter shifted from wages and consumer good prices to financial assets. Credit expansion enabled the purchase and repurchase of financial assets, bidding up their prices irrespective of investment. In doing so, it allowed governments to halt inflation in consumer goods, at the cost of shifting investment away from the real economy and into the financial sector.

  25. #175
    dangerous floater Winehole23's Avatar
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    Minsky correctly points out that the “Volcker Shock” ended the era of stagflation by destroying the demand for money. It wasn’t the reduction of the state’s money supply, but the absolute destruction of the private economy that ended the great inflation. And it was changes in the real economy that made Volcker’s shock sustainable. The breaking of the OPEC cartel and the defeat of the labor movement destroyed the barrier to expanding investment and reduced the power of labor to bargain for wages.



    What Minsky did not predict was that this situation would persist for a very long time. In the United States and around the world, deflationary political coalitions have proved to be very durable.

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