Another thing to watch for is the BLS import prices which show prices excluding tariffs. If these remain flat for July as they did for June, it would be another data point suggesting tariffs induced inflation.
"Trump's pick to lead economic data agency floats ending monthly jobs report" - https://www.bbc.com/news/articles/czerwl2xee4o
This is the result of policy decisions with well-understood outcomes. 0% interest rates for years, printing unprecedented amounts of money during COVID, historically high tariffs, etc.
Now we'll all be 3%-10% poorer, in a single year, yet I see no accountability. In fact, I see people pressuring the Fed to lower (!) rates, the tariffs don't seem to be going anywhere, and government spending and debt are at all-time highs.
I genuinely cannot understand this. If your actions will predictably make everyone poorer, and then the predictions come true, how can this not result in widespread loss of trust in governance?
_The Price of Time: The Real Story of Interest_ by Edward Chancellor goes in depth on this, a really interesting read.
Kamala tried to warn us about this. It's also quite clear that Kamala lost the first 10 minutes of the debate. It's only later on when Trump went full-Trump that Kamala was able to turn the debate around.
You can blame it on Kamala, Trump, the media or the American public, but this sort of stuff is very hard to communicate effectively.
Tariffs are taxes and are inflationary. "China is going to pay" is a lie. People tried to communicate this, but weren't believed, so gave up.
Whether that has negative effects elsewhere, I have no idea and thank goodness I'm not in charge of that.
"Inflation’s Impact on Stock Returns" - https://www.investopedia.com/articles/investing/052913/infla...
"...Since the 1930s, the research suggests that almost every country suffered its worst real returns during high inflation periods..."
I have a family of five. No matter how much my home value increases or how well the market does, I still need to pay to live.
Now you might ask why the Fed targets 2% and not 0% and that's because a world where inflation is 0% is brutal for debtors which is basically everyone. The fact that inflations occurs basically guarantees that people who don't over leverage won't be stuck in perpetual debt. That means people can take out loans, start companies and buy equipment to grow the economy. If we had 0% inflation all of that activity becomes much harder.
Another way to see it is:
If you have mortgage inflation comes of the liability of that debt since inflation is not just inflating all the bad parts but all the parts of the economy. And de-risks investment mostly because debt is in nominal terms. Now you cannot have rabid inflation but its not just as though anything above 0% inflation is bad.
But the way "the markets" have behaved so far, I expect a full turnaround and record S&P500 numbers by close today.
The amazing thing to me is that markets aren't tanking on this news. Are they just pricing in that prices will go up, so revenue with go up, and if margin maintains, profit will go up by a similar amount?
vdupras•1h ago
Something in July made the prices jack up in a really serious way.
jjgreen•1h ago
treetalker•1h ago
PaulHoule•1h ago
mlinhares•1h ago
isbwkisbakadqv•1h ago
vdupras•1h ago
marcosdumay•1h ago
The 3.3% figure is annual, normally called "last 12 months" to avoid confusion with a fixed year.
LargeWu•35m ago
"Prices increased 0.9% in July, which would translate to an annual inflation rate of 11.3%" is one way to say it with more clarity.
Also, Trump has a habit of picking numbers out of context when they suit his personal narrative. For example, not long ago he said something like "The price of gas is down to $1.98 per gallon" when in fact that that number was something along of the lines of the wholesale price. So it's no wonder people are misinformed when they get misleading economic information.
marcosdumay•33m ago