Inflation Erased U.S. Income Gains Last Year

https://www.wsj.com/economy/consumers/census-income-insurance-poverty-2024-31d82ad0

140•JumpCrisscross•4h ago

Comments

pavlov•2h ago

This year both inflation and unemployment are going up, so it’s only getting worse.

deepsun•2h ago

And debt is going up as well.

estearum•2h ago

On the plus side so is energy costs

themafia•1h ago

Which would all be fine if wages were being adjusted at the same rate inflation is. The American worker class and the ownership class drift further and further apart.

msandford•1h ago

I can't wrap my head around anyone being happy about this who isn't extremely rich. Would love to understand.

teachrdan•1h ago

I believe that comment was meant to be sarcastic.

throwawaymaths•1h ago

opec just announced production hikes

tzs•47m ago

At least /r/leopardsatemyface has plenty of material.

nickthegreek•2h ago

i got bad news about health insurance costs…

esseph•1h ago

I'm hearing higher than 25%+ all-in...

newfriend•1h ago

Inflation is lower than it was at the beginning of the year. Which means inflation is actually going down this year.

toasterlovin•1h ago

Tariffs are just starting to work their way inoto consumer prices now.

chrisco255•15m ago

Tariffs are deflationary, actually. They are a form of taxation and act to inhibit demand.

Anyways inflation is actually declining and is well below 2022 levels.

https://www.bls.gov/charts/consumer-price-index/consumer-pri...

Retric•30m ago

We don’t have accurate data for most of 2025. The second half of 2024 was much better than the first half of 2024 which is really helping those year long moving averages, but the monthly inflation numbers have been increasing recently so it’s far to early to say what 2024 vs 2025 will actually look like.

chrisco255•14m ago

Yes we do, price data is very reliable on a monthly basis:

https://www.bls.gov/charts/consumer-price-index/consumer-pri...

Employment figures are different and have had lots of problems in recent years.

Retric•12m ago

You linked July which covers 7 out of 12 months. However, pricing data isn’t quite inflation data as that includes housing data which is sampled every 6 months.

Now if you’re happy comparing 12 month averages ending in July then sure 2025’s July was 0.2% lower than 2024’s July. But I’m assuming you’re talking Jan-Dec 2024 which we have vs Jan-Dec 2025 which IMO is to early to call.

zzzeek•16m ago

Why is everyone complaining? Wokeness is dead, and you can use all kinds of ethnic and ableist slurs again. Isn't that worth global economic collapse ?

cyanydeez•15m ago

Its obviously not dead until you kill reddit, timblr, etc.

FirmwareBurner•2h ago

Me as an European with this issue for 3+ years: "first time?" /meme

jus3sixty•2h ago

Const economy = [ “People living check to check”, “Landlords living month to month”, “Corporations living bailout to bailout”, “Governments living war to war” ];

argentinian•2h ago

Do people in the U.S. have a good understanding of the causes of inflation?

OgsyedIE•2h ago

Not even most economists do, by analogy to how opaque the questions of lifting bodies and rayleigh scattering are to physicists.

Eddy_Viscosity2•2h ago

Yeah no, economists and a lot of people understand the the causes of inflation. There are economists who are paid very well to not understand it though, and such positions are often high in the government and financial sector hierarchies.

OgsyedIE•1h ago

No really, transonic flow and turbulence are less complicated than what's really going on underneath the quantity theory of money. If it was easy there would be fewer economists.

ajross•8m ago

The only people certain about economics are the kind of folks who run around on HN talking about "printing money". Too lazy to look up your post history to see which camp you belong in.

But no, macroeconomics is understood from sound general principles, but it is not a robust predictive theory. The analogy upthread to Navier-Stokes is apt.

chrisco255•5m ago

Are these the same Fed economists that claimed the elevated inflation levels were transitory in 2021?

There are multiple schools of thought on causes of inflation, but generally I agree with late Milton Friedman that it is "everywhere and always a monetary phenomenon". Money supply expansion growing faster than GDP expansion causes inflation.

dennis_jeeves2•1h ago

No.

To me the answer is very simple, the primary (not sole) driver is govt printing currency indiscriminately.

throwawaymaths•1h ago

It's more complicated than that (lending also increases the money supply) though you're right that "printing money" loosely speaking is the primary irreversible driver.

dennis_jeeves2•1h ago

Of course the printed money has to be put into circulation ( either lending or spending by the gov)

somewhereoutth•1h ago

In modern economies, banks create money by originating loans. The government controls this process with various policy levers.

orwin•1h ago

Depends on the default rate, and I'm pretty sure the past year in the US, default created more money than what was printed (even taking QE into account).

Basically why everybody decided to go with money printing during COVID btw, people realised in 2008 that a 2B default is the equivalent to printing 2B, so if that's the case, why not print money instead (that's a bad calculation imho, in my opinion in a capitalist market economy you need defaults for the market to work, and I would say, you need defaults that pierce the corporate veil).

bryanlarsen•1h ago

We've had a dozen instances of massive money printing since the 80s but no significant inflation until we had the COVID supply side shock. Now we're getting inflation because of tariff uncertainty, also a supply side shock.

Friedman is wrong, inflation is primarily caused by supply side shocks.

kattagarian•1h ago

This is something being debated across the world. I'm not american and in my country economists wages war over the "inflation is the result of monetary expansion". I know nothing about it, the only thing i know is that inflation is getting worse (almost) everywhere.

throw__away7391•1h ago

People in the US believe that if inflation eases, for example from 4% to 3%, that means that prices are going to go back down to what they used to be before inflation started rising. They furthermore believe that if that does not happen it is proof that the media is lying.

_--__--__•1h ago

Politicians love communicating about 2nd and 3rd derivatives of prices and debt in ways that even mathematically literate people have trouble immediately interpreting. There's a famous quote about Nixon doing it but it's honestly the current standard mode from all sides trying to avoid blame for the state of the deficit and monetary supply.

bithive123•1h ago

"Inflation" simply refers to a rise in general price levels. The cause of inflation is known: someone sets a price.

There isn't a single reason why someone might raise a price. It could be that they have some ideology about the size of the money supply (i.e. "printing money") or it could be that the costs of their inputs went up ("inflation") due to tariffs, or other supply chain problems. Or it could be a cynical bet that the market would bear a higher price ("using inflation as an excuse").

Blaming inflation on this-or-that cause is most definitely a political rather than theoretical exercise.

esseph•1h ago

Absolutely not, as a rule.

Esophagus4•1h ago

I’m nervous Trump seems to be pushing so hard for rate cuts given this reality of what seems like uneasy inflation.

That will likely benefit hard assets like real estate and those with big stock portfolios, as top blue chips generally have some pricing power to offset increased cost, but I think real income will drop and you’ll get all sorts of weird second order consequences.

If I had enough confidence in it, an interesting bet might be borrowing to invest in big tech blue chips. You’re betting that Trump gets his way with the Fed politically, tech benefits from low rates, tech has power to raise prices, and that Trump will inflate away your debt.

Won’t be good for most Americans, but if you can’t beat em, join em?

{not financial advice}

hiddencost•1h ago

Relatively benefit. Everyone will be poorer in real terms but they'll lose less quality of life.

NewJazz•1h ago

Debt is usually one of the best hedges against inflation. Instead of buying stocks on margin, though, people usually buy more price inelastic assets like homes.

Esophagus4•1h ago

Yeah, I’ve just never really liked the carry costs of a house… taxes, maintenance, utilities, transaction costs, etc. and never wanted to deal with being a landlord.

Plus, while the real estate market on a whole might go up, I have a hunch the chances of one individual house appreciating are more varied than the chances of one of the big tech stocks appreciating… as they are the market at this point.

Edit to add: I think for the average American, real estate is the only plausible way to invest on margin, as you’ll never get 5:1 leverage at your brokerage, if you even have a brokerage.

ajross•11m ago

That's because the median person qualifies for a vastly larger mortgage than margin limit.

Margin trading is for the already-wealthy. You can get a home with near-zero assets.

bradleyjg•28m ago

The Fed only controls the overnight rate, the shortest term rate. If it loses its reputation for independence we may well see higher long term rates even if they cut the overnight rate to zero. That would be quite bad for real estate.

The next step if that happened could well be the puppetized Fed expanding the balance sheet to buy long term bonds. That would probably be bad for everything. Except perhaps gold.

cramcgrab•22m ago

Time to cut interest rates. I’m tired of paying high mortgage interest and loan interest.

PieTime•7m ago

When I see sub 40 percent approval rate for both parties in congress… we’ve almost reached the moment where a majority of people believe both democrats and republicans have a negative view yet the 3rd parties will remain elusive due to gerrymandering districts.

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