August CPI numbers were released this morning, and both the core and headline rates spiked considerably:
The spike in the headline rate was expected due to rising gasoline prices, but the spike in the core rate is harder to explain. Air fares were up a lot, but there were no big increases elsewhere. The so-called "supercore" rate, which excludes food, energy, and shelter, remained subdued at 2.4%.
On a year-over-year basis, headline inflation was up 3.7% and core inflation was up 4.3%.
Ah, the comforting "supercore" rate always helps me relax because, don't know about you, but I don't spend anything on food, energy, or shelter - which makes supercore a perfect reflection of my economic experience. And there are a lot of people out there just like me! Just ask around.
Bidenflation?
Pshaw!
Core at 3.4% is just not that of a big deal, give me a break. It is normal for prices to oscillate and as I have written here before, the Fed target should hover closer to 3% than 2% for several reasons including relative personal consumption impact, uncertainties and inaccuracies and the nature of a global economy.
And this is why everyone is overwhelmed with stress!!!!
Surely there must be an ultracore measure out there to tell us things are getting cheaper.
I wouldn't call the core rate "spiking"; I would say it "ticked up a bit," but whatever. The headline rate is not good news, but due mostly to exogenous factors. The gas prices are because the Russians and Saudis are trying to put the screws to Biden -- that's it. They're who we should be mad at. I think rents continue to rise as well in a lot of major metro areas. They just hit a new all-time high in NYC, for example. Food prices will continue to be high as well because of severe drought in the Midwest and Texas -- that hits beef in particular, but a lot of other things as well made with soy, oils, grains, etc. and the disruption of grain supplies from Ukraine isn't helping. Relating to that drought, there's also the looming threat that low water levels on the Mississippi this fall could slow down barge traffic and lead to shortages and higher transportation costs. Unfortunately this means we're almost certainly not done with Fed rate hikes.
All this will be solved once Joe Biden is impeached, of course, so that's where our focus should be...
I have no issues with the cost of gasoline soaring. In fact, let's hope it keeps increasing and the petroleum refiners price themselves out of the energy market.
Then what? Not everyone can afford a new car right now, much less an electric one.
Public transportation. Car pooling. Bicycling.
That month-to-month change in the core index, if I'm reading the chart correctly, is less than we got for any month from October 2021 through May 2023. It still says inflation has calmed down.
You gonna respond to Brad DeLong's post?