Month: October 2022

If it's PCE inflation day, it's also personal income day. Here is disposable personal income through September:

The bad news is that after adjusting for inflation personal income was flat from last month (actually, up 0.02% if you want it to the fourth decimal place). That's a drop of more than $2000 since its trendline peak at the start of 2021.

In trendline terms, real DPI is now down to its level from the start of 2019, nearly four years ago. In absolute terms, it's down to its level from late 2019.

In other words, when you adjust for inflation, there's been zero progress for personal income over the past three years. On the brighter side, expenditures continue to increase:

As you can see, expenditures have continued their pre-pandemic trend and are now at a record level. How long can this keep up with incomes flat? Come back to me in a year and I'll tell you.

Without further ado, here is the core PCE inflation rate through September:

Core PCE checked in at 5.5% in September, with the trendline down to about 4.7%.

I am, as usual, highlighting the core rate (inflation excluding food and energy) because that's the figure that allegedly drives the Fed's decisionmaking. The good news this month is that it's down a bit from last month. The bad news is that it now looks like July was an outlier and core PCE is declining at a slower rate than we'd hoped.

Here is ordinary old headline PCE inflation (includes everything):

Th news here is actually better. PCE inflation was up a bit in September to 4.1%, but that's still pretty low and keeps the trendline solidly down. For what it's worth, an inflation rate around 4% is really not all that bad, especially if it's declining smartly.

(The more normally reported year-over year figures came in at 6.2% for core and 5.1% for headline inflation. But after all this time we know better than to rely on annual changes that already have 11 months of data baked in. Right? It's better to look at monthly changes that show how inflation is doing right now, and then draw a trendline to see the longer-term change.)

My M-protein number was up yet again this month:

It's not as if my M-protein level is skyrocketing or anything, but it's fairly high and getting steadily higher with my current chemo regime. Here's hoping the folks at City of Hope come through with a spot for the Carvykti CAR-T treatment for me sometime soon.

In other news, earlier this morning my telescope mysteriously stopped working and I also got word that my primary care doctor is about to kill my Ambien prescription, something I've been dreading for a while. This all adds up to a pretty discouraging day.

POSTSCRIPT: What's the deal with the backlash against Ambien, anyway? I know it has side effects, but every sleeping med has side effects and Ambien's don't seem much worse than anyone else's. They sure do get a lot more attention, though, especially when celebrities are involved. I mean, here's an article about a woman who had some weird side effects from using 400–1400 mg of Ambien daily.¹ Holy shit! I'm surprised she's still alive. Writing an article like this is the same as writing about someone who gained weight eating 50 pounds of chocolate every day. What's the point?

¹I take 5 mg per day. It's rare to take more than 12.5 mg daily.

Several UN agencies have issued gloomy reports recently about climate change:

Emissions must fall by about half by 2030 to meet the internationally agreed target of 1.5C of heating but are still rising, the reports showed....The UN environment agency’s report found there was “no credible pathway to 1.5C in place” and that “woefully inadequate” progress on cutting carbon emissions means the only way to limit the worst impacts of the climate crisis is a “rapid transformation of societies”.

This is all correct. It's a fantasy to think we will come within a light year of meeting our 2030 goal, and nearly as big a fantasy to think we'll come close to our 2050 goal. There's no evidence that this will happen, nor any evidence that anyone is willing to accept the sacrifices necessary for a "rapid transformation" of society. There are only two things that have even the slightest chance of working:

• Pouring massive amounts of money into R&D and hoping we come up with something revolutionary.
• Committing to geoengineering whether we like it or not.

Unfortunately, virtually no one support these things either, other than rhetorically in a few cases. Here is the annual change in global carbon emissions over the past century, with a trendline from 1950-2021 drawn in:

The trendline is dead flat. Every year the world adds about half a billion more tonnes of CO₂ to the atmosphere than it did the year before. This has stayed the same for more than 70 years in the face of endless COP meetings; international goals by the dozens; buildouts of wind and solar; reams of scientific research; and almost universal agreement that climate change is a crisis. Despite all this, it's pretty obvious that the world isn't making any real effort at this.

UPDATE: The chart and text originally said we added half a trillion tonnes of CO₂ to the atmosphere every year. That should be half a billion tonnes, and this is not total emissions but the increase in total emissions each and every year. We're currently emitting about 36 billion tonnes of CO₂ every year from fossil sources.

Why was I so late getting to the GDP numbers this morning? Well, let me tell you.

Yesterday was dex day, so I went up to my favorite dark spot in the desert to shoot a picture of the Iris Nebula. Traffic was surprisingly heavy, but when I got there the sky was lovely and the stars were brilliant. I got great focus, great polar alignment, and I slewed right over to my target. Then I started up a calibration run, which takes about ten minutes. To kill time, I set up my regular camera to take a star trail picture.

After a few minutes I went back to check on my calibration and . . . my mount had stopped. The software said it could no longer connect to a port—or even find a port—and after a good deal of checking I finally decided it was an equipment problem, not a software/OS problem. That means it's either a bad cable or a bad USB port on the mount. I haven't figured out which yet, but I sure hope it's a bad cable. Sure, a replacement will almost certainly be outrageously priced, but that means forty or fifty bucks. A blown USB port on the mount, by contrast, might be covered under warranty but will still be an enormous pain in the butt.

So that was bad. But then, near Coachella on my way home I saw something on the highway, swerved to miss it, but didn't. Whatever it was, it blew out a tire and made me swerve even more. Luckily, it was 4 am and Interstate 10 at that point has a huge median between eastbound and westbound traffic. I ended up pointed the wrong way on the median, but no harm was done except for the tire. However, it took an hour or two for AAA to fix things, and by then the sun was coming up so I ended up pulling off the road a bunch to take pictures. Also, I spent the whole drive home dawdling along in the slow lane.

So here are today's pictures. The top one shows AAA fixing my tire. The bottom one shows how bad a star trail picture can be when the camera isn't focused very well. It was also exposed wrong and has a ton of noise. Other than that, it's great!

Everyone is excited that average 30-year fixed mortgage rates broke the 7% barrier this week. Here's the latest from Freddie Mac:

It's understandable that mortgage rates are going up, but it's a little hard to understand why they're going up so much. But they are. All those people who've spent the past few years complaining about how expensive it is to live in big cities are about to have their wishes come true. All they have to do is wait patiently through the upcoming housing bust and then wait some more for interest rates to go down. Plus, by the time this happens they'll be farther along their career path and making more money. Then they'll finally be able to afford a house in LA or New York, assuming they're still interested.

Maybe. Possibly. But that's my best guess.

Today is GDP day, but I'm a little late with it. However, I have a good excuse! More on that later. For now, let's get to it:

Overall, this is a pretty good report. It was driven mostly by final sales to consumers and improved trade, not by things like inventories and IP valuations. Sales of goods were down while sales of services were up. And the overall GDP number was decent even though residential construction was down a whopping 26%. (Commercial construction was down 15%.)

The bad news, needless to day, is that Jerome Powell will undoubtedly see nice growth as an excuse to raise interest rates even more. But we'll see. Tomorrow is PCE inflation day, which should have an impact on whatever the Fed decides to do next month.

A column by Katrina vanden Heuvel in the Washington Post brings an idea to mind: maybe Democrats need to go small. Instead of trying to brag about big things—DACA, infrastructure, the child tax credit, etc.—brag instead about small, concrete things. The prototype for this is Cash for Clunkers, a program that every serious economist agreed was pointless but which was nonetheless wildly popular.

Here are a few examples. Note that all of them are things that are happening either right now—it's not a litany of greatest hits from the past—or in the near future:

• You can now buy an OTC hearing aid without a prescription, and for a fraction of the cost of current hearing aids.
• We have cut off China's access to advanced computer chips.
• The price of insulin will be cut to $35 in January for Medicare users, and President Biden has ordered HHS to lower other prescription drug prices later in the year.
• HHS is also working to ensure greater access to contraceptives in the wake of the Dobbs decision.
• President Biden has lowered gasoline prices by releasing oil from the Strategic Petroleum Reserve. It will be replaced by future purchases of lower cost oil, which will save taxpayer money in the long run.
• Thanks to Democratic management of the economy, inflation is already starting to come down.
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• If you use Obamacare, subsidies have been increased for middle-class workers. This means that their premiums have gone way down.
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• The CHIPS Act dedicates billions of dollars to bringing back advanced chip design and manufacturing to America.
• The bipartisan infrastructure act provides money for new bridges, roads, airports, and other transportation projects in all 50 states.
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• The Inflation Reduction Act is creating 550,000 jobs in wind, solar, battery plants, and solar panels. It also provides a $7,500 rebate on electric vehicles.
• The No Surprises Act bans surprise billing in hospitals from out-of-network providers or air ambulance services for emergency medical care, and prohibits out-of-network doctors from issuing surprise bills for non-emergency care.

That's a top ten list. Feel free to add your own, but keep them simple, concrete, and not hated by anyone outside the MAGA cult.

When I visited Paris I naturally decided I wouldn't take pictures of the Eiffel Tower. I mean, why bother? There are millions of them out there and the world hardly needs a few more.

But wherever you go in Paris, the Eiffel Tower is always there and always begging to be photographed. So I did. But we certainly don't need five days of Eiffel Tower photos, so instead I'm going to post them all at once. Here they are, from a variety of angles and at a variety of times. All of them were taken in late May. Enjoy.

Here's the rate of on-the-job injuries over the past three decades:

This is not merely an artifact of job composition, either. If you look, say, only at manufacturing jobs or health care, the injury rate has dropped the same amount. Hooray for OSHA!