Month: August 2022

Check this out:

The Producer Price Index clocked in at -6% from June to July on an annualized basis. Core PPI remained positive, but declined to 2.3%. As with other inflation indexes, they both peaked in March and have been easing off ever since.

The biggest price increases were in eggs, beef, and construction. The biggest declines were in energy and grains. More generally, the decline in PPI was nearly all for goods, with PPI for services flat for the month.

PPI is generally considered a leading indicator for CPI. If this remains the case—and who really knows these days?—it's yet more evidence that inflation peaked in the first quarter of the year and has been slowly subsiding ever since.

Here are all the episodes of high inflation that we've had over the past 70 years:

The time frame for each episode is from trough to peak. I used core PCE as the measure of inflation since that's (allegedly) what the Fed uses.

So is our current inflationary episode big or small compared to those in the past? Assuming that it's reached its peak and will now start declining, the answer is probably "small." But it seems pretty big because 30 years of the Great Moderation has gotten us in the habit of thinking about nearly any bout of inflation as catastrophic.

As you may recall, I got cataract surgery several months ago even though I don't have cataracts. I just wanted to replace my natural lenses with artificial lenses that promised sharp eyesight both near and far. Here's how it went.

My original intent was to get multifocal lenses that are designed with two separate focus points, but the ophthalmologist I saw talked me into something different: RxSight lenses that can be adjusted after they've been implanted and have an extended focus range.

Sadly, the former was true but the latter wasn't. What I ended up with was two monofocal lenses. My left eye had good distance vision but terrible near vision. My right eye had good near vision but terrible distance vision. In some people this is OK because your brain will merge them together and produce good eyesight at all distances. My brain was not clever enough to do this.

After a few months to give the lenses (and my brain) a fair shot at working, I finally asked to have them replaced with the multifocal lenses I wanted in the first place. A few weeks ago we implanted a Synergy lens in my left eye.

The Synergy lens has good distance vision and so-so near vision. However, this works fine: with good near vision in one eye and OK near vision in the other, my reading vision is pretty good. And my distance vision is fine even though my right eye still has terrible far vision.

However, all was not perfect: the Synergy lens produces a sort of vague double vision as well as strong halos at night when I look at bright lights. This is tolerable, and might get better with time, but I wasn't willing to risk putting another one in my right eye. If I ended up with both double vision and so-so near vision in both eyes, I was afraid I'd lose my reading vision entirely.

So I canceled the surgery for my right eye and I consider myself done for now. I'll reassess at the end of the year depending on whether the Synergy lens improves by then.

This may all sound like bad news, and it has been a pain in the ass. However, I did meet my goal: I no longer wear glasses at all and my vision is acceptable at all distances.¹ I wish it were sharper, but it's sharp enough for all ordinary activities, and I hold out hope that my brain will eventually edit out the the halos and double vision.

Would I recommend this for others? I would definitely avoid the RxSight lenses, which I later learned aren't even recommended unless you have an eye condition that precludes the use of multifocal lenses (I don't, and my doctor never should have proposed them). If you have to have them, then go ahead, but you'll just end up with a very expensive pair of monofocal lenses.

The Synergy lenses are better, but their near vision is only OK, not great. I have some fuzziness too, but not everyone does. It's a bit of a crapshoot.

And it's expensive. My surgery cost a little over $10,000. If I had it to do over again, I'm on the fence. It did work, but only barely.

¹Oddly, there's a caveat here: I now wear sunglasses outdoors. I never did before, but the artificial lenses are clearer than my old natural lenses. In theory that's good, but in practice it means I now have to haul around sunglasses on bright days, though I can do without them if I have to.

The big climate change bill includes a provision allowing Medicare to negotiate drug prices. However, you'll be excused for being less than impressed when you learn that this applies to only ten drugs starting in 2026, increasing to 20 drugs by 2029.

But there's more! The other Medicare provisions in the bill haven't gotten as much attention but are probably more important. Here they are:

• An annual cap of $2,000 on out-of-pocket spending on prescription drugs.
• A limit on drug price increases to the rate of inflation.
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• A cap on insulin copays of $35.

And for everyone else:

• It extends the expanded subsidies for Obamacare. No one will have to pay more than 8.5% of their income for family coverage.

It's worth noting that the inflation cap on prescription drug prices is probably better than it seems. The overall inflation rate of prescription drugs is higher than inflation by a fair amount, though that's cooled down some since the start of the pandemic. However, that's an average of all drug prices. As KFF points out, there's a subset of about 20% of all drugs—including nearly all of the most popular ones— that have seen very high increases. Keeping those prices reined in will make a big difference to a lot of people.

None of the Medicare stuff applies to those of us on commercial plans because the Senate parliamentarian ruled that they didn't qualify for the 50-vote threshold of the reconciliation process. However, Democrats are likely to reintroduce the insulin cap as a standalone bill, so that has a chance of helping everyone. The inflation cap, however, is probably going to stay limited to Medicare for now.

Rather than spread them out, here are three views of the Roman Colosseum at dawn. The top photo was taken from the northeast corner with the Vittorio Emanuele monument in the distance.

The middle photo was taken from the south side looking east toward the rising sun.

The bottom photo is a forced-perspective shot taken from nearly the same spot as the top photo. From near to far, it shows a bit of the dome of the Basilica di Maxentius in the Roman Forum; the dome of the Chiesa Santi Luca e Martina martiri; the red brick of the Basilica di Santa Maria in Ara coeli; and finally the Vittorio Emanuele monument again.

If we take CPI as our measure and assume that June was the peak for headline inflation, here's how long our current round of inflation lasted:

• Headline: 15 months (April 2021 to June 2022)
• Core: 12 months (April 2021 to March 2022)

Does 12 months count as transitory? Certainly it's longer than Team Transitory initially expected, which I think was around six months. On the other hand, one year isn't really all that long, especially when you consider the exacerbating effect of the Ukraine war, which was hardly predictable.

Personally, I was on Team Transitory all along and I still am. Am I just being stubborn? Maybe, especially when you consider how high inflation got. But in the great scheme of things, I don't think 12 or 15 months counts as a major league round of inflation. We took a chance on a big stimulus bill keeping the economy strong at the risk of higher inflation, and unfortunately the risk of inflation turned out to be real—largely because pandemic supply chain problems lingered longer than we expected; 2021 housing price increases got recorded this year for technical reasons; and Vladimir Putin decided to invade Ukraine and then botched it. But even knowing all that, I'd still make the same choice today. Maybe I'd cut back the stimulus bill a bit, but only by a bit.

We have broken the back of inflation!

OK, not really, but the news is good this month. The headline rate of inflation dropped from 9% to 8.5% while the core rate of inflation stayed steady at 5.9%. Given the underlying state of the economy, which is pretty strong, this probably finally represents that we've passed the peak of our latest round of inflation.

If that's true, it lasted about 12-18 months depending on how you measure things, and that's certainly as long as it should have lasted. With stimulus money long gone and housing prices starting to ease after a torrid 2021, the core rate started declining earlier this year. And with energy prices finally coming down from their June peaks, headline inflation is coming down too. In fact, it should be declining more, if you ask me. But food is still a problem, rising at a 10.9% annualized rate in July.

On the wage front, the news was good or bad depending on what you were hoping for. On a monthly basis, hourly wages were up 0.46% and weekly wages were up 0.49%. Since monthly inflation was down .02%, this means that hourly and weekly wages were up 0.48% and 0.51% respectively after adjusting for inflation. On an annualized basis that comes to 7.6% and 8.2%.

On a year-over-year basis, hourly wages were up 5.2%, which comes to -3.3% adjusted for inflation. Weekly wages were up 4.6%, which comes to -3.9% adjusted for inflation.

So wages were way up for the month but still negative for the year. Also remember that up is good if you're a worker, but down is good if you're worried about a wage-price inflation spiral. So you may decide for yourself if you think the July numbers were good or bad.

Not much to report this month:

My M-protein level dropped from 0.75 to 0.74. A bigger decline would be nice, but holding things steady is fine. This won't matter for much longer anyway if I get the call for CAR-T treatment soon, since that will then be responsible for my cancer load and I'll be off the chemo treatments. Clap hard for this to happen in August.

Your average lazy travel blogger/photographer wouldn't bother to visit La Defense on a trip to Paris. "It's just a puffed-up office park. What's the point?" Or maybe they'd take a telephoto image from around the Arc de Triomphe and call it a day.

But not me. Admittedly, I didn't go until our very last day, when I had an afternoon to kill and nothing else to do. And it is just a quick Metro ride from central Paris. And it was born the same year as me. But the point is that I went.

And I'm glad I did. Sure, it's just a big office park, sort of like the Pentagon is just a big building. But it's impressive in its own right—although they should shoot the person who decided it was a good idea to build a crappy chain restaurant right in the middle of the courtyard. Overall, it was worth milling around there for a couple of hours watching the kids do wheelies and taking pictures here and there.

Republicans have gone all in on their gigantic hissy fit over the FBI search of Mar-a-Lago. In one sense, of course, this isn't surprising: the hissy fit has been the defining characteristic of the Republican Party ever since Newt Gingrich invented it in the '90s and and Fox News perfected it in the aughts.

At the same time, this is a particularly instructive case since literally no one has any idea what the FBI search was about. Classified document handling? Maybe. But we haven't seen the warrant. Or the application for the warrant. Or the judge's approval. Or any of the FBI work product leading up to it. Or anything. The FBI could be investigating Trump for anything from shoplifting to serial murder for all we know.

In other words, we know—for a fact—that the Republican hissy fit is based on absolutely nothing. It's just a reflex designed to work the refs, and we can only hope that this time around the refs (i.e., the media) don't fall for it. Republicans should get no extra coverage for their claims just because they're united and loud. They should get coverage if they have actual evidence to back up their complaints.¹

¹I feel like this should go without saying, but I mean real evidence, not the daily drip of dimwitted, context-less snippets that Republicans perfected during the Obama administration (Solyndra, Fast & Furious, the IRS, Benghazi, Hillary's emails, etc.).