Financial topics

[aeden]

...it’s “ridiculous to put it on us. We’re not the ones that created the problem.”

True as we head into September.
They are cemented in chaos on the runway as it was put the summer of chaos into Elul.
No they cannot see or hear.

[Tom Mazanec]

The way to encourage inflation is to have interest rates below the inflation rate. We have that. So really inflation
should be going up.

-vincente

And that has to be the actual inflation rate, not the phony number the government gives out. Shadowstats I hear has that twice or more what it is said to be (can't afford a subscription).

[Tom Mazanec]

DJIA:
30,448.61
-648.65

[Cool Breeze]

DJIA:
30,448.61
-648.65

How low do we go? I say S&P to 3200-ish by mid August.

It is amusing when you guys point out early day (open) drops and then it returns to a small positive day by the end of it.

[vincecate]

So I think it will be more than 8.6% of last month. I think this will surprise people.
Cleveland Fed is estimating that next month will go down to 8.44% but if July 13th info is higher (as I expect) they
will increase the next month estimate that same day.

https://www.clevelandfed.org/our-resear ... sting.aspx

So they have now raised the 8.44% to 8.52%. So last month's 8.6% is only estimated to drop to 8.5% after 2 months. So the data is not showing a rapid drop back to 2% inflation, which most people still seem to believe.

Again, I expect the number on the 13th to be high and for them to raise the 8.52% right after that. It would not take much for inflation to keep going up the next two reports.

At some point the transient idea will really be behind us and people will see us going up from 8.6% and I think that is when people really panic.

[aeden]

https://mises.org/library/bureaucracy

So it begins.
Book four reopened.
Good luck into earnings as Morgan Stanley warned.

[Tom Mazanec]

One thing that might keep inflation down for a bit is going into the Greater Recession. If a lot of businesses go out of business and have liquidation sales that might make a dent.

[vincecate]

One thing that might keep inflation down for a bit is going into the Greater Recession. If a lot of businesses go out of business and have liquidation sales that might make a dent.

There are sort of two groups of things, the necessary and the optional. On optional things you can have going out of business sales. On the necessary things I expect continued inflation.

[Tom Mazanec]

A Rare Paradigm Shift With Huge Implications… 5 Reasons Why It’s Imminent
https://internationalman.com/articles/a ... -imminent/

To summarize, here are the five reasons to expect higher interest rates:

Inflation is out of control. Even the government’s official inflation statistics—which understate the situation—are far above current interest rates.
The federal government must issue a flood of new Treasuries to finance multi-trillion dollar deficits—which are here to stay.
Sanctions are eroding confidence in the US financial system.
Foreigners aren’t buying as many Treasuries.
The Fed is tightening.
When you connect all the dots, I think it’s clear we are starting a new long-term cycle, with rising interest rates and a bear market in bonds. That will have enormous implications for the economy and the stock market.

We will likely see incredible volatility in the financial markets as thousands of businesses that had become accustomed to easy money and artificially low interest rates go bankrupt.

Strike Three for the Federal Reserve
https://www.aier.org/article/strike-thr ... l-reserve/
Great Depression Thirties and Great Inflation Seventies were strikes one and two.

Rising Interest Rates May Blow Up the Federal Budget
https://mises.org/wire/rising-interest- ... ral-budget

If Treasury rates continue to rise, and rise precipitously, the effects on congressional budgeting will be immediate and severe.

[vincecate]

Now raised the 8.44% to 8.52%. So last month's 8.6% is only estimated to drop to 8.5% after 2 months. So the data is not showing a rapid drop back to 2% inflation, which most people still seem to believe.

Now the 8.44% number for 5 weeks from now has been raised to 8.6%. So the Cleveland Fed is not estimating any reduction in the CPI from last month for the 2 following months. Again, they have been low most of the last year.

https://www.clevelandfed.org/our-resear ... sting.aspx