Inflation declined to 4.9% in April . . .

[Sope Creek]

. . . mostly because of the Fed's interest rate increases. That's one piece of the good news. The bad news is that inflation remains high . . . and more interest rate increases and maybe a recession might be needed to bring it down further. Housing remains high . . .

. . . another piece of good news is that the labor economy remains strong with wages up 4.4% over a year ago . . . and that wage increases were the product of inflation, not the cause of inflation.

Inflation stayed high last month, compounding the challenges facing the U.S. economy

Consumer prices in April were 4.9% higher than a year ago, according to the Labor Department. Prices rose 0.4% between March and April.

www.nprillinois.org

 

[UncleMark]

. . . another piece of good news is that the labor economy remains strong with wages up 4.4% over a year ago . . . and that wage increases were the product of inflation, not the cause of inflation.

As long as anyone who wants a job can get one, then all the rest is details.

Despite the strains on the economy, the job market remains unusually strong. The unemployment rate is just 3.4%, matching a 54-year low. And last month employers added 253,000 jobs.​

 

[snarlcakes]

. . . mostly because of the Fed's interest rate increases. That's one piece of the good news. The bad news is that inflation remains high . . . and more interest rate increases and maybe a recession might be needed to bring it down further. Housing remains high . . .

. . . another piece of good news is that the labor economy remains strong with wages up 4.4% over a year ago . . . and that wage increases were the product of inflation, not the cause of inflation.

Inflation stayed high last month, compounding the challenges facing the U.S. economy

Consumer prices in April were 4.9% higher than a year ago, according to the Labor Department. Prices rose 0.4% between March and April.

www.nprillinois.org

The yoy inflation the past 3 April's are 4.2%, 8.3%, and 4.9%. I predict the will wave the white flag at some point and call 3-4% the new target. I think the market is predicting rate cuts by the end of the year.

 

[Sope Creek]

As long as anyone who wants a job can get one, then all the rest is details.

​

I understand that point. I really do . . . but can we disagree and still be friends?

Inflation is real, no matter whether you have a job.

God is in the details . . . and so is the Devil . . . .

 

[mcmurtry66]

As long as anyone who wants a job can get one, then all the rest is details.

Despite the strains on the economy, the job market remains unusually strong. The unemployment rate is just 3.4%, matching a 54-year low. And last month employers added 253,000 jobs.​

Not really. Wages matter. When the avg new car is $50k and a house north of 400 saying you can get a job doesn’t mean much. Checks don’t go far. Taxes. Loans. Daycare. Groceries. I’m still shocked at grocery prices. Small bag of Cheetos $5

 

[Cortez88]

Not really. Wages matter. When the avg new car is $50k and a house north of 400 saying you can get a job doesn’t mean much. Checks don’t go far. Taxes. Loans. Daycare. Groceries. I’m still shocked at grocery prices. Small bag of Cheetos $5

The decades of little to no actual wage growth really caught up to us in this inflationary cycle. In the 0% interest era workers could get by. Now the mismatch in prices and wages is evident.

 

[UncleMark]

Not really. Wages matter. When the avg new car is $50k and a house north of 400 saying you can get a job doesn’t mean much. Checks don’t go far. Taxes. Loans. Daycare. Groceries. I’m still shocked at grocery prices. Small bag of Cheetos $5

The joblessness that a recession would create (that is being encouraged to quell inflation) will fall on the lower paid working classes. They aren't buying new cars and houses. No matter how you spin it, having a job beats not having one, whether inflation is up or not.

 

[larsIU]

The decades of little to no actual wage growth really caught up to us in this inflationary cycle. In the 0% interest era workers could get by. Now the mismatch in prices and wages is evident.

And rising wages may fuel continued inflation right up until the inevitable recession.

 

[Cortez88]

And rising wages may fuel continued inflation right up until the inevitable recession.

Quite a pickle it is. How do you prevent a wage spiral while trying to help employees not get run over by inflation?

 

[larsIU]

Quite a pickle it is. How do you prevent a wage spiral while trying to help employees not get run over by inflation?

It's like I tell my kid, one mistake or bad decision...not so bad. But a bad deicsion followed by another bad decision leads only to more situations where there are only less bad decisions and no good ones.

Another rate hike and the recession looms. Which will kill the wages and job growth. No rate hikes and inflation will probably take care of a bunch of problems on its own, like using a grenade to kill a spider.

 

[mcmurtry66]

The joblessness that a recession would create (that is being encouraged to quell inflation) will fall on the lower paid working classes. They aren't buying new cars and houses. No matter how you spin it, having a job beats not having one, whether inflation is up or not.

They are paying daycare ($2k a month for me for one kid) health insurance, high gas prices, groceries etc. I’m not sure in the long run everyone wouldn’t be better off with a recession and inflation coming down. I don’t really know

 

[snarlcakes]

Quite a pickle it is. How do you prevent a wage spiral while trying to help employees not get run over by inflation?

The inflation is caused by printing and the wage spiral follows. Stop printing more pieces of paper and inflation will eventually subside, as would the wage spiral.

 

[Sope Creek]

And rising wages may fuel continued inflation right up until the inevitable recession.

But according to the article linked in the OP they apparently aren't . . . at least not yet.

 

[Baller23Boogie]

Since I started at my job, I think we've raised prices three times in my three years, which means since I'm commission for my route, everytime they raise prices, I get a raise.

I'm surprised that people are still paying at the prices some of this stuff is, which just goes to show people will pay for convenience.

Good foe my pocket, I guess.

 

[JamieDimonsBalls]

. . . another piece of good news is that the labor economy remains strong with wages up 4.4% over a year ago . . . and that wage increases were the product of inflation, not the cause of inflation.

So still negative real wage growth. For over two years now...

Real average hourly earnings decreased 0.5 percent, seasonally adjusted, from April 2022 to April 2023.
The change in real average hourly earnings combined with a decrease of 0.6 percent in the average
workweek resulted in a 1.1-percent decrease in real average weekly earnings over this period.

 

[UncleMark]

They are paying daycare ($2k a month for me for one kid) health insurance, high gas prices, groceries etc. I’m not sure in the long run everyone wouldn’t be better off with a recession and inflation coming down. I don’t really know

So yeah, how about we fix that by throwing a bunch of them out of work?

 

[mcmurtry66]

So yeah, how about we fix that by throwing a bunch of them out of work?

Maybe. Again I don’t know. If it allows more people to make it instead of be employed but come up short it may be better in the long run

 

[Baller23Boogie]

They are paying daycare ($2k a month for me for one kid) health insurance, high gas prices, groceries etc. I’m not sure in the long run everyone wouldn’t be better off with a recession and inflation coming down. I don’t really know

2k a month for child care?

Is that average where you live?

 

[snarlcakes]

The joblessness that a recession would create (that is being encouraged to quell inflation) will fall on the lower paid working classes. They aren't buying new cars and houses. No matter how you spin it, having a job beats not having one, whether inflation is up or not.

The issue is eventually you get both if you don't take care of inflation quickly. It's why Powell hiked rates so quickly after being behind the curve.

 

[UncleMark]

Maybe. Again I don’t know. If it allows more people to make it instead of be employed but come up short it may be better in the long run

We all revert to our own situations and project them on everyone else, you with your new car bitching and new house bitching and child care bitching, and me with being out of a job or having my wages cut.

 

[mcmurtry66]

2k a month for child care?

Is that average where you live?

Yes. This place is hardly fancy. It’s a catholic school

 

[mcmurtry66]

We all revert to our own situations and project them on everyone else, you with your new car bitching and new house bitching and child care bitching, and me with being out of a job or having my wages cut.

For sure. And I’m trying to speak “big picture”

 

[UncleMark]

2k a month for child care?

Is that average where you live?

Yeah, that's nuts. Lots of old grannys here in the trailer park watching kids for cheap.

 

[Univee2]

Yeah, that's nuts. Lots of old grannys here in the trailer park watching kids for cheap.

Cash basis?

 

[SqueakyClean]

2k a month for child care?

Is that average where you live?

I know I was paying about 1.5k a month for two kids about 15 years ago, so I wouldn't be surprised if that was accurate.
Granted, that was also one of those fru-fru child-care places. When the youngest turned 5, we ended up having a lady down the road watch them in the afternoons for a fraction of that. So it all depends on what you can find.

 

[UncleMark]

For sure. And I’m trying to speak “big picture”

I gave you my big picture. Jobs take priority. You getting a buy on a new car or a cheaper Starbucks doesn't trump a guy trying to make ends meet.

 

[UncleMark]

Cash basis?

Of course. They're babysitters, not child care providers. Big difference.

 

[mcmurtry66]

I gave you my big picture. Jobs take priority. You getting a buy on a new car or a cheaper Starbucks doesn't trump a guy trying to make ends meet.

Right but if ends meat is the goal and it becomes more and more unattainable it’s a gerbal on a wheel scenario.

 

[Univee2]

Of course. They're babysitters, not child care providers. Big difference.

You’re good as long as a second cop car doesn’t show up.

 

[IUclover]

2k a month for child care?

Is that average where you live?

I pay $1500 for one kid and was paying over $2k prior to our new daycare. And the $1500 includes my employee discount (university daycare). Pretty average for my area.

 

[Baller23Boogie]

Yes. This place is hardly fancy. It’s a catholic school

Jesus.

That's brutal.

My sitter is super awesome and only charges us $100 a week since she only watches her a couple hours a day during the week. She use to charge $150, but my kid is kind of her designated helper, and has watched her since she was like six months old, so she kind of loves us. Oh, and during the summer, she supplies lunches. You should move.

I've got one more year after this one before my youngest is out of elementary and then she hits middle school and then will be riding the bus home with her sister who is in high school (middle and high school share the same parking lot and will ride the same bus) so we won't be using her for much longer, unfortunately.

 

[larsIU]

But according to the article linked in the OP they apparently aren't . . . at least not yet.

Well wages still aren't keeping up and, in this scenario, remain just a % of the problems contributing to inflation. There are bigger fish to fry than the wages though.

The supply chains look better but the inflation baked into RIGHT NOW can't be undone. We can't go back in time. Maybe we'll learn from it. Maybe a global pandemic isn't really something we, as humans in a ever increasingly connected world, have learned to absorb economically just yet. We've almost killed off war though. Famine, illiteracy, and dare I say poverty, will someday be killed off as well.

Edited. Bold

 

[Sope Creek]

So still negative real wage growth. For over two years now...

Real average hourly earnings decreased 0.5 percent, seasonally adjusted, from April 2022 to April 2023.
The change in real average hourly earnings combined with a decrease of 0.6 percent in the average
workweek resulted in a 1.1-percent decrease in real average weekly earnings over this period.

What are you gonna do? Until wages return to workers what productivity gains were realized from the 80s on, real wages are gonna suck.

The key is owning your own home and living with fixed housing costs while everything else goes up . . . we used to bank the difference, but corporations have wizened up to that. We also had no cell phone and internet charges . . . and cable was $25.

 

[mcmurtry66]

Well wages still aren't keeping up and, in this scenario, remain just a % of the problems contributing to inflation. There are bigger fish to fry than the wages though.

The supply chains look better but the inflation baked into RIGHT NOW can't be undone. We can't go back in time. Maybe we'll learn from it. Maybe a global pandemic isn't really something we, as humans in an ever increasingly connected world, have learned to absorb economically just yet.

What are you gonna do? Until wages return to workers what productivity gains were realized from the 80s on, real wages are gonna suck.

The key is owning your own home and living with fixed housing costs while everything else goes up . . . we used to bank the difference, but corporations have wizened up to that. We also had no cell phone and internet charges . . . and cable was $25.

People will work more and have shittier lives. 9-5 job and Uber on weekends

 

[UncleMark]

People will work more and have shittier lives. 9-5 job and Uber on weekends

Not necessarily shittier. Too many refuse to be satisfied with what they have. That's been the key to my contentment.

 

[JamieDimonsBalls]

What are you gonna do? Until wages return to workers what productivity gains were realized from the 80s on, real wages are gonna suck.

But that isn't exactly what happened. For quite a few years, earnings met or exceeded inflation.

 

[mcmurtry66]

Not necessarily shittier. Too many refuse to be satisfied with what they have. That's been the key to my contentment.

Again I don’t think that’s the issue. To me it’s the floor becoming too high for too large a percentage of the country to meet.

 

[Sope Creek]

But that isn't exactly what happened. For quite a few years, earnings met or exceeded inflation.

The point was about productivity and wages. Wages are behind because capital took all the productivity gains.

 

[snarlcakes]

But that isn't exactly what happened. For quite a few years, earnings met or exceeded inflation.

If you want to eat pizza, not go to college, and sleep on your mom's couch, I'll accept wages have kept up with inflation.

 

[mcmurtry66]

If you want to eat pizza, not go to college, and sleep on your mom's couch, I'll accept wages have kept up with inflation.

When they take IGW out for his walk he’s going to take a flamethrower to this thread