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Money, Banking and the Economy
Sunoverbeach Offline
#351 Posted:
Joined: 08-11-2017
Posts: 10,089
What do you get when you cross a snowman and a vampire?
Frostbite
rfenst Offline
#352 Posted:
Joined: 06-23-2007
Posts: 36,329
Bubble? Which bubble?
rfenst Offline
#353 Posted:
Joined: 06-23-2007
Posts: 36,329
Fed officials note US job market near full recovery

But concerns over inflation’s spread, duration remain, meeting minutes show

Associated Press

WASHINGTON — The U.S. job market is nearly at levels healthy enough that the central bank’s low-interest rate policies are no longer needed, Federal Reserve officials concluded last month, according to minutes of the meeting released Wednesday.

Fed officials also expressed concerns that surging inflation was spreading into more areas of the economy and would last longer than they previously expected, the minutes said.

“Many (policymakers) saw the U.S. economy making rapid progress” toward the Fed’s goal of “maximum employment,” the minutes said. “Several” officials said they felt the goal had already been reached.

The minutes underscored the Fed’s sharp pivot from what had been its policy through most of the pandemic, shifting from keeping interest rates very low to encourage more hiring, to moving quickly toward raising rates to rein in inflation, which has surged to four-decade highs.

Fed officials also voiced heightened concerns about inflation, a development that pushed down stock prices after the minutes were released. Bond yields also rose in response. The yield on the 10-year Treasury note, a benchmark for setting rates on mortgages and many other kinds of loans, increased to 1.7% soon after the minutes were released, from 1.68% just before.

“Inflation readings had been higher and were more persistent and widespread than previously anticipated,” the minutes said. “Some participants noted that ... the percentage of product categories with substantial price increases continued to climb.”

With inflation worsening and unemployment falling more quickly than many economists expected, Fed Chair Jerome Powell said after the Dec. 14-15 meeting that the central bank was accelerating the reduction of its ultra-low interest rate policies.

The Fed said last month that it would reduce the monthly bond purchases it has made since the spring of 2020 — which are intended to lower long-term rates — at twice the pace it had previously set and will likely end those purchases in March. That accelerated timetable puts the Fed on a path to start hiking its benchmark short-term interest rate as early as the first half of this year.

Fed policymakers also suggested they could hike the Fed’s short-term benchmark interest rate three times this year. That signaled a significant pickup from their September meeting, when the 18 policymakers split over whether to lift rates a single time in 2022.

Even Fed officials who have long been focused on keeping rates low to combat unemployment — such as San Francisco Federal Reserve Bank President Mary Daly and Minneapolis Fed President Neel Kashkari — now cite concerns about high inflation as a reason for raising interest rates this year.

The Fed’s key rate, which has been near zero for nearly two years, influences many consumer and business loans, including mortgages, credit cards and auto loans.
rfenst Offline
#354 Posted:
Joined: 06-23-2007
Posts: 36,329
$29K for an average used car? Would-be buyers left shocked

Prices for used cars have soared so high that buyers are being priced out of the market.

Associated Press

DETROIT — A couple of months ago, a woman paid a visit to Jeff Schrier’s used car lot in Omaha, Nebraska. She was on a tight budget, she said, and was desperate for a vehicle to commute to work.

She was shown three cars priced at her limit, roughly $7,500. Schrier said the woman was stunned.
“ ‘That’s what I get for $7,500?’ ” he recalled her saying.

The vehicles had far more age or mileage on them than she had expected for something to replace a car that had been totaled in a crash.

The woman eventually settled on a 2013 Toyota Scion with a whopping 160,000 miles on it. Schrier isn’t sure he made any profit on the deal.

“We just helped her out,” he said.

As prices for used vehicles blow past any seemingly rational level, it is the kind of scenario playing out at many auto dealerships across the country. Prices have soared so high, so fast, that buyers are being increasingly priced out of the market.

Consider that the average price of a used vehicle in the United States in November, according to Edmunds.com, was $29,011 — a dizzying 39% more than just 12 months earlier. And for the first time that anyone can recall, more than half of America’s households have less income than is considered necessary to buy the average-priced used vehicle.

The days when just about anyone with a steady income could wander onto an auto lot and snag a reliable late-model car or buy their kid’s first vehicle for a few thousand dollars have essentially vanished.

The blame can be traced directly to the pandemic’s eruption in March 2020. Auto plants suspended production to try to slow the virus’s spread. As sales of new vehicles sank, fewer people traded in used cars and trucks. At the same time, demand for laptops and monitors from people stuck at home led semiconductor makers to shift production from autos, which depend on such chips, to consumer electronics.

When a swifter-than-expected economic rebound boosted demand for vehicles, auto plants tried to restore full production. But chip makers couldn’t respond fast enough.

And rental car companies and other fleet buyers, unable to acquire new vehicles, stopped off-loading older ones, thereby compounding the shortage of used vehicles.

Bleak as the market is for used-car buyers, the computer chip shortage has also driven new-vehicle prices higher. The average new vehicle, Edmunds.com says, is edging toward $46,000.

Even so, prices of used cars are likely to edge closer to new ones. Since the pandemic started, used vehicle prices have jumped 42% — more than double the increase for new ones. Last month, the average used vehicle price was 63% of the average new vehicle cost. Before the pandemic, it was 54%.

Including taxes, fees, a 10% down payment, and an interest rate of around 7.5%, the average used vehicle now costs $520 a month, even when financed for the average of nearly six years, Edmunds calculated.

David Paris, a senior manager at J.D. Power, noted that used vehicle prices are directly tied to the cost of new ones. Though some automakers report that the computer chip supply is gradually improving, prices paid by dealers at used vehicle auctions kept rising through November, Paris said.

Among the few consumers who stand to benefit are those who want to sell a used car and don’t necessarily need to replace it. The average trade-in value in October, Paris said, was $9,000 — twice what it was a year earlier.

Some people may have to pay for repairs to keep a current vehicle running as long as possible. But even that option can become prohibitively expensive.
RayR Offline
#355 Posted:
Joined: 07-20-2020
Posts: 5,140
rfenst wrote:
Bubble? Which bubble?


The Debt Bubble, The Real Estate Bubble, the Inflation Bubble, the Equities Bubble...
We got more bubbles than Lawrence Welk!
rfenst Offline
#356 Posted:
Joined: 06-23-2007
Posts: 36,329
RayR wrote:
The Debt Bubble, The Real Estate Bubble, the Inflation Bubble, the Equities Bubble...
We got more bubbles than Lawrence Welk!

Recessions are followed by prosperity/booms and economic bubbles, which are followed by recessions et al. They are to be expected. If you are certain one is about to burst and think you know exactly when, you should short sell everything you own.
RayR Offline
#357 Posted:
Joined: 07-20-2020
Posts: 5,140
rfenst wrote:
Recessions are followed by prosperity/booms and economic bubbles, which are followed by recessions et al. They are to be expected. If you are certain one is about to burst and think you know exactly when, you should short sell everything you own.


You are not going to tell me that economic bubbles and busts are a natural or supernatural occurrence, are you?
When each has been man-made, the result of retarded monetary policy, retarded government legislation, and spending? They have all become even more frequent since we've been cursed with the central planning of the Federal Reserve cartel and its monopolies of creating fiat money and artificially set interest rates. They are no more normal than inflation is normal in a free market capitalist system.
HockeyDad Offline
#358 Posted:
Joined: 09-20-2000
Posts: 42,828
The problem with trying to time a bubble popping is you are betting against the government. Letting it ride during a bubble is betting on the government to ease things down into a soft landing.
Sunoverbeach Offline
#359 Posted:
Joined: 08-11-2017
Posts: 10,089
What do you call someone with no body and no nose?
Nobody knows
RayR Offline
#360 Posted:
Joined: 07-20-2020
Posts: 5,140
HockeyDad wrote:
The problem with trying to time a bubble popping is you are betting against the government. Letting it ride during a bubble is betting on the government to ease things down into a soft landing.


The problem with betting on the government is that is the geniuses in government are ofttimes in denial there is a bubble to begin with, until it's too late.
Sunoverbeach Offline
#361 Posted:
Joined: 08-11-2017
Posts: 10,089
Want to hear a joke about paper?
Never mind. It's tearable
rfenst Offline
#362 Posted:
Joined: 06-23-2007
Posts: 36,329
2021 shattered job market records, but it’s not as good as it looks

When placed in proper context, the massive job and wage gains of 2021 start to come back down to earth


WAPO

While the labor market began 2021 in a deep hole, huge numbers of Americans found work amid the pandemic, with a record-breaking 6.4 million jobs added over the course of last year, eclipsing all expectations.

Rank-and-file workers’ hourly paychecks rose by $1.46 an hour, another record-breaking number. Gains were especially pronounced for those in lower-paying industries.

It was, by these measures and many others, the best year in labor-market history, ignited in part by aggressive stimulus spending that pushed consumer spending to stratospheric levels. But the numbers on their own can be downright misleading.

The 6.4 million jobs gained this year, while a record in absolute terms, represents only a 4.5 percent increase in the workforce. That’s smaller than the 5.0 percent growth seen in 1978, when a much smaller labor force added 4.3 million jobs. In fact, relative to the size of the workforce, it’s only the 11th best calendar year since record-keeping began in 1939.

This year’s numbers are also distorted because the recovery isn’t complete. As a rule, the labor market has a much easier time regaining lost jobs than it does creating new ones. The economy lost 22.4 million jobs at the height of coronavirus lockdowns. When you account for the 12.3 million jobs regained in 2020 as businesses reopened, plus the 6.4 million added in 2021, the economy is still missing 3.6 million jobs (the numbers may not match perfectly due to rounding). And that would just bring it back to pre-recession levels.

To catch up with population growth, the economy needs 5 million more jobs, according to economist Elise Gould of the Economic Policy Institute, a left-leaning think tank. Before the recession, jobs were growing faster than population. To reach levels where employment would have been, had pre-pandemic job growth trends continued, the U.S. would have to add 8 million jobs, Gould says. And that will only get harder as federal stimulus programs run out.

The easiest gains that propelled eye-popping months like million-job-July are now off the table. Last December, there were still 3.1 million workers on temporary layoff who could be called back to their employers. This December, that pool of temporarily laid off workers had fallen to 812,000. That’s below its 2019 average and dropping at a steady clip. Employers who still need workers will have to cast a wider net and look at workers with less-relevant experience or try to woo workers with flexibility, like opportunities for remote work or more control of their schedules.

As a result, Americans are experiencing a surge in job security. There are more job openings per jobseeker than there have been at any other time since the government started keeping track in 2000, said University of Minnesota economist Aaron Sojourner, who worked in the White House during the Obama and Trump administrations. The number of part-time workers who want full-time work continues to fall rapidly, as employers are asking staff to work longer hours.

One common thread between worker leverage and the slowing job growth in recent months? The number of available workers remains low. More than 1.5 million Americans have retired earlier than expected during the pandemic, and hundreds of thousands more have left the labor force for other reasons, including child care and health worries.


The share of Americans working or looking for work plunged during the pandemic and remains near levels not seen since the 1970s, when many women were still working at home and had yet to join the official labor force.

Employers who can’t find workers may look to automation to fill the gap. Ohio pipemaker Advanced Drainage Systems saw record sales in the most recent quarter but couldn’t keep its production lines running full time due to labor shortages, said CEO Donald Scott Barbour on a recent earnings call. Barbour mentioned the company was pursing “all kinds of other projects of automation” at a manufacturing facility in Kentucky, so they could meet demand without big increases in hiring.

Even the most careful headline numbers hide that not all groups of Americans have recovered equally. Asian workers have already regained all the jobs they lost during the downturn, and their Hispanic peers are close, but White and Black workers remain farther behind. Black women, in particular, still have 4.5 percent fewer workers than they did before the pandemic began. White women have 2.3 percent fewer.

“The pandemic exacerbated existing labor market inequities,” wrote Nela Richardson, ADP’s chief economist, in a recent blog post. “Low-skilled workers took the brunt of job losses. The recovery has been slowest for people of color and women. Women also are disproportionately shouldering added family responsibility and suffering bigger pay gaps.”


Like the jobs numbers, the wage gains of 2021 also tend to wilt under scrutiny. A record $1.46-an-hour raise brought pay for the average rank-and-file worker to $26.61.

That 5.8 percent increase is still the biggest annual raise workers have seen in 40 years, since the last big (7.2 percent) bump in 1981. Relative to the size of their paychecks, workers saw a bigger raise every year from 1971 to 1981 than they did in 2021.

As in the 1970s, workers’ raises look even worse this year after accounting for inflation. Prices grew 6.8 percent in the year ending in November, the most recent data out. To put it another way, workers’ earnings have actually lost ground as supply-chain issues, the pandemic and swollen savings accounts drive up the cost of living at a pace not seen in decades.

The highest wage gains tended to go to workers in the lowest-paid industries, according to a Washington Post analysis of Labor Department data. For workers in those industries, like nonmanagerial gas station workers who saw pay jump 14.1 percent to $14.72 an hour, wage gains have stayed ahead of rising prices. The fastest gains of any subsector went to nonmanagerial hotel workers, who saw pay climb 22.5 percent to $18.90 an hour, as employers were forced to pay more for some jobs that leave workers exposed to the still-virulent coronavirus.


The global pandemic, of course, stalked the 2021 labor market from start to finish. The numbers in December’s report were measured in the middle of the month, before the Omicron variant ignited a record-breaking acceleration in covid-19 cases. If the latest affected the labor market like the Delta variant did — an impact that’s far from guaranteed — it likely won’t show up until next month’s numbers.

So, as we etch 2021 into the record books, remember that we do so with a big, spiky coronavirus-shaped asterisk. It was a year in which everything moved fast, but nothing was ever as simple as it seemed.
Sunoverbeach Offline
#363 Posted:
Joined: 08-11-2017
Posts: 10,089
What do you call a deer with no eyes?
No eyed deer
tonygraz Offline
#364 Posted:
Joined: 08-11-2008
Posts: 18,026
Seems clear to me that Sunoverbeach knows more about Money, banking and the economy than Ray(Ray).
Sunoverbeach Offline
#365 Posted:
Joined: 08-11-2017
Posts: 10,089
How many bugs do you need to rent out an apartment?
Tenants
rfenst Offline
#366 Posted:
Joined: 06-23-2007
Posts: 36,329
Bond Selloff Rattles Markets

A slide in bond prices has pushed the 10-year Treasury yield to 1.769%, its highest since early 2020

WSJ

A year-opening bond rout has pushed longer-term interest rates to new pandemic-era highs, sending shock waves across financial markets.

U.S. traders had barely switched on their computers last Monday for the first trading session of the year when bond prices started tumbling. The yield on the benchmark 10-year Treasury note, which rises when bond prices fall, jumped in just one day from its year-end close of 1.496% to 1.628%. By Friday, it had settled at 1.769%, smashing through its 2021 closing high of 1.749% to reach its highest level since January 2020, before officials reported the first Covid-19 case in the U.S.

The worst week for 10-year notes since 2019 wasn’t a disaster for stocks—the S&P declined 1.9%—and didn’t come as a complete surprise. Investors widely expected yields to rise this year as the Federal Reserve starts raising short-term interest rates. Stock indexes have generally performed well in years when the central bank was in the early stages of tightening monetary policy, and many analysts anticipate a repeat this year, thanks in part to continued growth in corporate earnings.

Still, the jump in yields happened faster than most had anticipated and sparked significant volatility. The Nasdaq Composite lost 4.5% in its worst week in more than 10 months, as rising yields hit shares of technology companies and other businesses that derive much of their value from profits expected further in the future. Salesforce.com dropped 10% for the week. The ARK Innovation ETF lost 11%.

Rising interest rates can hurt stocks in several ways, from increasing corporate borrowing costs to offering investors an alternative means of earning decent returns. The impact tends to be larger on so-called growth stocks because investors deem uncertain future profits less valuable when they can get more guaranteed income from Treasurys. Higher yields also push up borrowing costs for consumers, highlighted last week by the average 30-year mortgage rate reaching a nearly two-year high at 3.22%.

Rising yields aren’t all bad news. On short-term bonds, they reflect expectations for Fed rate increases. But on longer-term bonds, they signal confidence that those rate increases won’t cause a recession. Shares of businesses in economically sensitive sectors, such as banking, industrials and energy, generally rose last week, with the S&P 500 financial sector gaining 5.4% in its best five-day start to a year since 2010.

Last summer, when Covid-19 cases surged due to the Delta variant, investors piled into bonds and technology stocks at the expense of some cyclical stocks. Now, during another Covid-19 wave driven by the more contagious but seemingly less severe Omicron variant, investors are doing the opposite, a sign that they think “the economy is still pretty strong once we can get past the surge in cases,” said Michael Arone, chief investment strategist at State Street Global Advisors.

Even so, last week served as a stark reminder that momentum can shift quickly even in the staid Treasurys market, denying investors the gradual climb that many say would be more easily weathered by other assets. Monday’s selling in particular stemmed from no fundamental catalyst, traders said. Rather, investors such as hedge funds that had slowed trading late in 2021 simply started betting again on higher interest rates.

The next day, the selling was spurred by a report in The Wall Street Journal that detailed how Fed officials were starting to think about reducing the size of the Fed’s $8.76 trillion portfolio of Treasury and mortgage securities—possibly not long after the Fed stops adding to that portfolio around the end of March.

Minutes from the Fed’s December meeting released Wednesday further increased expectations that the central bank could start raising interest rates at its March meeting—earlier than many investors had previously anticipated.

Selling then continued Friday after the release of data showing that employers added fewer-than-expected jobs in December, with investors seizing on a decline in the unemployment rate and an increase in worker earnings as evidence of a very tight labor market.

Investors and analysts point to one simple reason why yields could keep climbing this year: Despite the recent selloff, bond yields still reflect investors’ expectations that the Fed won’t raise rates as high as central-bank officials have indicated they think is likely.

Interest-rate derivatives suggested Friday that investors think short-term rates will reach around 1.7% in four years and then hang around close to that level for the rest of the next decade. By contrast, most Fed officials at their last meeting indicated that they think the rates will average 2.5% over the longer run. That estimate doesn’t account for the possibility that the central bank could raise rates above that so-called neutral level to slow the economy and curb inflation.

SHARE YOUR THOUGHTS
Do you expect U.S. Treasury yields to rise in 2022? Join the conversation below.

Still, many investors are skeptical that the Fed will be able to raise rates to 2.5%. Some point to the last economic expansion, when the central bank did raise rates that high only to quickly retreat when growth started to falter and stocks fell sharply. Many investors also think that last year’s surge in inflation would largely abate this year even without much help from the Fed.

Zhiwei Ren, a fixed-income portfolio manager at Penn Mutual Asset Management, said his team was positioned for yields to rise this year across almost all Treasury maturities. Still, yields on longer-term Treasurys will only continue to climb if Fed officials hew a careful middle road, keeping investors confident that short-term rates will rise but still optimistic about the economy, he said.

“If you want rates to go higher,” he said, “you want the Fed to be the right amount of hawkish.”
Speyside2 Offline
#367 Posted:
Joined: 11-11-2021
Posts: 1,620
Personally I prefer money, guns, and lawyers.
rfenst Offline
#368 Posted:
Joined: 06-23-2007
Posts: 36,329
Four reasons you’re seeing empty grocery store shelves

The omicron surge, extreme weather and record December sales are among the reasons that toilet paper aisle is looking shaky again

WAPO

It’s barely 2022 and already social media is swamped with pictures of empty grocery shelves — from cream cheese to paper towels, children’s juice boxes and cat food.

Some of the culprits for this round of shortfalls are the same as in the early days of the pandemic, and some can be chalked up to new problems bumping up against old ones.

Here are some of the reasons an array of your favorite items may be out of stock at grocery stores.

Omicron’s surge
The omicron variant surge has meant more work for stores — more deep cleaning, a return to masking and social distancing — just as more employees can’t work and are calling out due to illness or quarantine.

In a Monday call with 27 food industry chief executives, Geoff Freeman, CEO of the industry organization Consumer Brands Association, said more employee absences were reported in the past two weeks than in all of 2020.

“That’s remarkable,” he said. “Throw on top of that being down 80,000 truck drivers nationally, and another 10 percent of workers being absent at food manufacturing facilities, and you’re putting a lot of pressure on the system all at one time.”

Covid has swept through supermarket chain Stew Leonard’s, which has stores in Connecticut, New York and New Jersey. Some 200 of its 2,500 employees are out sick or in quarantine, said owner Stew Leonard Jr.

“It puts a challenge, for example, on making every kind of pizza you want: The pineapple and ham pizza, we’ve decided not to make,” Leonard said. “And most manufacturers out here have done the same thing. Everyone is hit with a shortage of labor. Some because of the Great Resignation, but a lot of it is the omicron surge.”

Access to rapid coronavirus tests is also making it challenging to get employees back to work swiftly, he added.

“Two weeks ago, our No. 1 selling item at Stew Leonard’s was filet mignon. Right now, the No. 1 seller is the rapid tests. We have a warehouse in New Jersey where we pick them up. We sent a tractor trailer and asked them to load them up. They said, ‘Not so fast. How much do you want to pay for them?’ It was a bidding war right there on the loading dock.”

The National Grocers Association has requested its grocers be prioritized for testing supplies from federal and state governments, and they’ve also asked for flexibility with new federal vaccination and testing mandates with the aim of minimizing further workforce disruptions, said Jim Dudlicek, the trade group’s communications director. With the prevalence of the omicron variant, even among vaccinated workers, many grocery chains are operating stores with less than half of their normal workforce, which makes it harder to stock and display grocery items or to prepare foods made on-site.

“While there is plenty of food in the supply chain, we anticipate consumers will continue to experience sporadic disruptions in certain product categories as we have seen over the past year and a half due to the ongoing supply and labor challenges,” Dudlicek said.

Where's the beef? How the coronavirus pandemic is disrupting the meat supply chain
Coronavirus outbreaks among workers at meat processing plants are disrupting the supply chain. (Sarah Hashemi, Jayne Orenstein/The Washington Post)
Hot economy collides with huge virus surge in pandemic’s latest twist

Winter weather

Winter storms dumped more than a foot of snow across parts of the Mid-Atlantic just after the New Year, and sweeping weather systems have made road conditions difficult in many parts of the country in the past two weeks.

For example, the 20-plus-hour traffic jam last week on I-95 near Stafford, Va., paralyzed a fair number of grocery delivery semi trucks.

“The winter months are always challenging,” said Doug Baker, vice president of industry relations for FMI, a food industry organization. “But we’ve seen weather patterns that we’re not used to in terms of frequency and magnitude, from the West Coast to the East Coast.”

In addition to weather delaying the delivery to grocery stores around the country, Baker said bad weather also influences consumer psychology, which played into some items getting sold out.

“There are certain products people ritually buy when there is an impending weather event,” Baker said. “And then when people see images of stores low on stock, it’s not out of the ordinary for people to buy two of something instead of one, just in case.”

And with more than 5,000 schools delaying their reopening this month due to the omicron surge and storms, families are feeling a greater urgency to lay in supplies of bread, milk, meat and cereal to make up for meals not eaten at school.

Canceled buses and a superintendent in the classroom: How omicron has thrown schools into crisis

Supply chain snarls
Supply chain problems are no longer just about shipping containers sitting in ports or out at sea, waiting to be unloaded. They are also about the slowing of the production of goods that the United States imports.

In China and the United Kingdom, some municipalities have once again shut down factories and thus slowed orders for certain ingredients and food products for U.S. imports.

“A lot of our ingredients and products come from countries that have had their own spikes,” Baker said. “Some countries have taken a very strict approach and shut down manufacturing, so that slows the whole process down. It’s not just a domestic issue, it’s about how other countries are dealing with omicron.”

Still, at the nation’s busiest port, the Port of Los Angeles, cargo volume fell sharply in November compared with a year earlier, according to the port’s own figures.

Fruits and vegetables have seen fewer instances of shortfalls and supply problems than other food categories, but currently there are some empty shelves that are more about food safety. The Food and Drug Administration last week issued a voluntary recall on certain bagged salads and other vegetables due to possible listeria contamination. In general, though, there have been fewer food recalls during the pandemic.

More people eating at home
A combination of factors from rising inflation to surging omicron cases are prompting households to eat at home more — meaning grocery stores are being inundated with shoppers once again.

Grocery sales climbed more than 8 percent in December, according to national retail sales tracker Mastercard SpendingPulse. Stores are still restocking from that surge and have been struggling to keep shelves fully stocked in several categories since the beginning of this year, according to data firm IRI’s consumer packaged goods supply index.

“We’re seeing a lot of restocking and replenishment going on,” said Jessica Dankert, vice president of supply chain for Retail Leaders Industry Association. The heavy shopping season has come at a particularly difficult time, coming out of the holiday period, when families traditionally cook more at home anyway.

Widespread storms and the increased hesitancy around dining out because of the omicron surge have contributed to more demand at grocers.

Also, in some cities, restaurants and other food service establishments had to close temporarily due to covid outbreaks among workers, which sent even more families to dine at home in December.

“You’ll see that replenishment build back up,” Dankert predicted, “but we’ll see these disruptions for months to come.” Inflation has also been influencing consumer behavior, driving them to eat more at home and travel and eat out less.

Grocery prices rose 6.4 percent over the past 12 months ending in December, the largest increase since 2008, according to a Bureau of Labor Statistics index of prices. And for subcategories such as beef, prices rose a staggering 20.9 percent.

Datassential’s analysts say consumers turn away from restaurants and back to home dining when food prices surge. Restaurant-going becomes more of a splurge. Couple that with consumer hesitancy due to omicron, and consumers are swinging back to eating more grocery store food.
rfenst Offline
#369 Posted:
Joined: 06-23-2007
Posts: 36,329
Only big government can tame big meat industry

Bloomberg Opinion

The Biden administration desperately needs a win on inflation, and cutting the price Americans pay for beef would have an immediate impact on most families.

Yet the prescription unveiled by the White House last week to boost competition in the highly concentrated meat sector, while prudent, won’t make much of a dent on meat prices, at least not for a while. It isn’t likely to help fight inflation, either.

Meat prices have been soaring — accounting for more than half the increase in grocery costs for American families. The blame for this, according to the administration, belongs with the four companies that together control more than 80% of the meatpacking market. The White House has been focused on this industry for months, arguing that excessive concentration is hurting consumers, who are paying more for their steaks and burgers, as well as small ranchers and farmers, who have struggled to stay profitable.

The push to inject competition into meatpacking is part of a broader effort by the Biden administration to challenge concentrations of power in business, in industries ranging from technology to railroads to health care. Under the plan, the administration will spend $1 billion to help independent meat processing companies expand their operations and hire additional workers

Yet it will take a while before the promised funds have any impact. For one thing, like much of the U.S. economy, the meat industry is dealing with a shortage of workers, which will make it challenging for smaller competitors to scale up without raising wages.


“You have 4 (million) to 5 million people missing from the workforce, and working in a slaughterhouse is not exactly a desirable job,’’ said Rodrigo Almeida, a Santander Bank analyst who follows meatpackers. “You can put as much money as you want to work, but if there’s no labor it’s hard to make these plans work.”

It also is up for debate whether fighting monopolies is the best way to tame inflation. Former Treasury Secretary Lawrence Summers took to Twitter recently to say that the administration’s efforts could have the opposite effect, by discouraging investment that could boost supply. A better approach to keep prices in check, Summers suggests, would be to open up the market to international competition.

This is not to say that the meat market isn’t due for an overhaul. In 1977, the largest four beef-packing firms controlled just 25% of the market, compared with 82% today. The market share of the big four — JBS SA, Cargill, National Beef and Tyson — has given them outsize power in setting beef prices.

Indeed, while the big meatpackers point to the increasing cost of everything from labor to trucks as the culprits for m[]It’s something of a paradox that prices of packaged beef have skyrocketed even as cattle prices have fallen. [/h]ore expensive beef, their profit margins have risen substantially, too. In other words, all those costs, and then some, are being passed along to consumers.[/h]

This suggests that funneling money to smaller producers won’t help on its own. Tougher enforcement is needed too.
There are signs that more oversight is coming. The Biden administration is now working to issue stronger rules under the Packers and Stockyards Act, a law designed to combat abuses by meatpackers and processors. In 2019, R Calf USA, a group representing ranchers, sued the four big meatpackers, accusing them of engaging in price-fixing, a charge the companies deny. The case is still working its way through the courts. Meanwhile, the Justice Department has been looking into industry practices since 2020. The U.S. Department of Agriculture also has started publishing prices that beef processors pay.

All these small steps could chip away at the big four. They might even slow the climb in meat prices. Just know you’ll still be paying more for burgers for some time to come.
rfenst Offline
#370 Posted:
Joined: 06-23-2007
Posts: 36,329
Global growth expected to slow

WASHINGTON — The World Bank is downgrading its outlook for the global economy, blaming continuing outbreaks of COVID-19, a reduction in government economic support and ongoing bottlenecks in global supply chains.

The 189-country, anti-poverty agency forecasts worldwide economic growth of 4.1% this year, down from the 4.3% growth it was forecasting last June. It’s also down from the 5.5% expansion it estimates the global economy tallied in 2021.

In its Global Economic Prospects report out Tuesday, the World Bank projects that the U.S. economy will grow 3.7% this year, down from 5.6% in 2021. It expects China, the world’s second-biggest economy, to see growth slow to 5.1% in 2022 from 8% in 2021.
RayR Offline
#371 Posted:
Joined: 07-20-2020
Posts: 5,140
rfenst wrote:
Only big government can tame big meat industry

Bloomberg Opinion

The Biden administration desperately needs a win on inflation, and cutting the price Americans pay for beef would have an immediate impact on most families.


Big Government Biden is a MEATHEAD.
HockeyDad Offline
#372 Posted:
Joined: 09-20-2000
Posts: 42,828
When they start distributing/selling “government beef” it won’t really be beef. I guarantee it!
DrMaddVibe Offline
#373 Posted:
Joined: 10-21-2000
Posts: 51,951
HockeyDad wrote:
When they start distributing/selling “government beef” it won’t really be beef. I guarantee it!



Soylent Green was set in 2022.
Speyside2 Offline
#374 Posted:
Joined: 11-11-2021
Posts: 1,620
OMG! It is.
RayR Offline
#375 Posted:
Joined: 07-20-2020
Posts: 5,140
Soylent Green + Government Cheese will be dubbed the Biden Burger.
Sunoverbeach Offline
#376 Posted:
Joined: 08-11-2017
Posts: 10,089
What did the Buddhist say to the hot dog vendor?
Make me one with everything
rfenst Offline
#377 Posted:
Joined: 06-23-2007
Posts: 36,329
Inflation at 40-year high pressures consumers, Fed and Biden

AP


WASHINGTON (AP) — Inflation jumped at its fastest pace in nearly 40 years last month, a 7% spike from a year earlier that is increasing household expenses, eating into wage gains and heaping pressure on President Joe Biden and the Federal Reserve to address what has become the biggest threat to the U.S. economy.

Prices rose sharply in 2021 for cars, gas, food and furniture as part of a rapid recovery from the pandemic recession. Vast infusions of government aid and ultra-low interest rates helped spur demand for goods, while vaccinations gave people confidence to dine out and travel.

The Labor Department reported Wednesday that a measure of inflation that excludes volatile food and gas prices jumped 5.5% in December, also the highest in decades. Overall inflation rose 0.5% from November, down from 0.8% the previous month.

Price gains could slow further as snags in supply chains ease, but most economists say inflation won’t fall back to pre-pandemic levels anytime soon.

“U.S. inflation pressures show no sign of easing,” said James Knightley, chief international economist at the financial services company ING. “It hasn’t been this high since the days of Thatcher and Reagan. We could be close to the peak, but the risk is that inflation stays higher for longer.’’

High inflation isn’t only a problem for the U.S. In the 19 European countries that use the euro currency, inflation rose 5% in December compared with a year earlier, the biggest increase on record.

Companies large and small are adapting as best they can.

Nicole Pomije, a bakery owner in the Minneapolis area, said she plans to raise prices for cookies because of surging ingredient costs.

Her basic cookies were priced at 99 cents each, while premium versions were selling for $1.50 each. But Pomije said she will have to jack up the prices of her basic cookies to the premium price.

“We have to make money,” she said. “We don’t want to lose our customers. But I think we might.”

Businesses struggling to hire have hiked pay, but rising prices for goods and services have eroded those income gains for many Americans. Lower-income families have felt it the most, and polls show that inflation has started displacing even the coronavirus as a public concern.

The United States hasn’t seen anything like it since the early 1980s. Back then, Fed Chair Paul Volcker responded by pushing interest rates to painful levels — the prime rate for banks’ best customers hit 20% in 1980 — and sent the economy into a deep recession. But Volcker succeeded in taming inflation that had been running at double-digit year-over-year levels for much of 1979-1981.

High inflation has put President Biden on the defensive. His administration, echoing officials at the Fed, initially suggested that price increases would be temporary. Now that inflation has persisted, Biden and some congressional Democrats have begun to blame large corporations. They say meat producers and other industries are taking advantage of pandemic-induced shortages to drive up prices and profits. But even some left-of-center economists disagree with that diagnosis.

On Wednesday, the president issued a statement arguing that the drop in gas prices in December and a smaller increase in food costs showed progress.

One trend experts fear is a wage-price spiral. That happens when workers seek more pay to offset higher costs, and then companies raise costs further to cover that higher pay. On Tuesday, Federal Reserve Chair Jerome Powell told a Senate panel that he has yet to see evidence that wages are broadly driving up prices across the economy.

The biggest driver of inflation, according to economists, are mismatches between supply and demand. Used car prices have soared more than 37% over the past year because a shortage of semiconductors has prevented auto companies from making enough new cars. Supply-chain constraints have driven furniture prices nearly 14% higher over the past year.

Shoppers are feeling the pinch all around them, from the gas station to the grocery store.

Vicki Bernardo Hill, 65, an occupational therapist in Gaithersburg, Maryland, says she no longer throws extra canned food, boxes of cereal or bakery items into her shopping cart at the Giant Food store.

“I am trying to stick to my list and buying things that are on sale, ” said Hill.

Because she couldn’t find a good deal on a used car, Hill recently bought a new Mazda, spending $5,000 more than she had planned.

Inflation could ease as the omicron wave fades and as Americans shift more of their spending to services such as travel, eating out and movie-going. That would reduce the demand for goods and help clear supply chains.

But some higher prices, such as rents, could prove to be stickier. Rental costs, which have accelerated since summer, rose 0.4% in December, the third consecutive monthly increase. That’s significant because housing costs make up one-third of the government’s consumer price index.

Powell told Congress that if it becomes necessary to fight high inflation more aggressively, the Federal Reserve is prepared to accelerate the interest rate hikes it plans to begin this year. The Fed’s benchmark short-term rate, now pegged near zero, is expected to be bumped up at least three times this year.

Rate increases would make borrowing for a home or car more expensive, and therefore help to cool off the economy.

Some economists and members of Congress fear the Fed has acted too slowly to head off inflation and that this could eventually force even sharper rate increases that could damage the economy.

Republicans in Congress and even some liberal economists say Biden deserves at least some of the blame for high inflation, arguing that the financial rescue package he pushed through Congress last March added significant stimulus to an already strengthening economy.

______

AP Writers Paul Wiseman and Josh Boak in Washington, Dee-Ann Durbin in Detroit and Anne D’Innocenzio in New York contributed to this report.
Sunoverbeach Offline
#378 Posted:
Joined: 08-11-2017
Posts: 10,089
I was digging a hole and found a chest of gold coins. I wanted to run and tell my wife about it. Then I remembered why I was digging the hole
DrMaddVibe Offline
#379 Posted:
Joined: 10-21-2000
Posts: 51,951
RayR wrote:
Soylent Green + Government Cheese will be dubbed the Biden Burger.


A Bidenflation whopper with.
rfenst Offline
#380 Posted:
Joined: 06-23-2007
Posts: 36,329
Fed’s Christopher Waller Says High Inflation Caught Central Bank Off Guard

Central bank official says three interest-rate increases this year are an appropriate baseline

WSJ

A Federal Reserve official warned that the central bank would have to move interest rates up more aggressively this year if inflation stays high through the first half of the year.

Fed governor Christopher Waller said he still thought it was reasonable to pencil in three rate increases this year, but that the rate path would ultimately depend on “what inflation looks like in the second half of the year. If it continues to be high, the case will be made for four, maybe five hikes,” he said in an interview on Bloomberg TV. “But if inflation falls back in the second half of the year, as many of us think it will…then you could actually pause and not even go the full three.”

Mr. Waller said he thought it would be appropriate to begin raising the Fed’s benchmark rate by a quarter percentage point at the central bank’s policy meeting in March, by which time the Fed will have ended its bond-buying stimulus program.

Brisk demand for goods, disrupted supply chains and various shortages have pushed 12-month inflation to its highest readings in decades. Core consumer prices, which exclude volatile food and energy categories, were up 4.7% in November from a year earlier, according to the Fed’s preferred gauge. That is well above the Fed’s 2% target.

The Fed official also said that the large increase in inflation last year had complicated the central bank’s new framework, which seeks to target 2% inflation over time by taking into account prior deviations from that target. The framework was designed to address the environment that prevailed before the Covid-19 pandemic, in which the Fed and other central banks had struggled to boost inflation.

“This kind of caught us off guard, these high numbers and what it implies for our policy and our policy framework,” he said.

The pandemic is “really throwing a wrench into how we want to think about things going forward, and so there might come a time” when the Fed would have to reconsider its new framework if inflation stayed high.

Mr. Waller dismissed a question about whether the central bank should consider a larger, half-percentage-point increase. “One of our key themes has been not to surprise markets,” he said. Even though a large rate increase could be “in the tool kit” he said, “it would take a lot for us to move in that direction.”
rfenst Offline
#381 Posted:
Joined: 06-23-2007
Posts: 36,329
Fed’s Christopher Waller Says High Inflation Caught Central Bank Off Guard

Central bank official says three interest-rate increases this year are an appropriate baseline

WSJ

A Federal Reserve official warned that the central bank would have to move interest rates up more aggressively this year if inflation stays high through the first half of the year.

Fed governor Christopher Waller said he still thought it was reasonable to pencil in three rate increases this year, but that the rate path would ultimately depend on “what inflation looks like in the second half of the year. If it continues to be high, the case will be made for four, maybe five hikes,” he said in an interview on Bloomberg TV. “But if inflation falls back in the second half of the year, as many of us think it will…then you could actually pause and not even go the full three.”

Mr. Waller said he thought it would be appropriate to begin raising the Fed’s benchmark rate by a quarter percentage point at the central bank’s policy meeting in March, by which time the Fed will have ended its bond-buying stimulus program.

Brisk demand for goods, disrupted supply chains and various shortages have pushed 12-month inflation to its highest readings in decades. Core consumer prices, which exclude volatile food and energy categories, were up 4.7% in November from a year earlier, according to the Fed’s preferred gauge. That is well above the Fed’s 2% target.

The Fed official also said that the large increase in inflation last year had complicated the central bank’s new framework, which seeks to target 2% inflation over time by taking into account prior deviations from that target. The framework was designed to address the environment that prevailed before the Covid-19 pandemic, in which the Fed and other central banks had struggled to boost inflation.

“This kind of caught us off guard, these high numbers and what it implies for our policy and our policy framework,” he said.

The pandemic is “really throwing a wrench into how we want to think about things going forward, and so there might come a time” when the Fed would have to reconsider its new framework if inflation stayed high.

Mr. Waller dismissed a question about whether the central bank should consider a larger, half-percentage-point increase. “One of our key themes has been not to surprise markets,” he said. Even though a large rate increase could be “in the tool kit” he said, “it would take a lot for us to move in that direction.”



Residential real estate loan rates have already gone up a bit in anticipation of this and will not go back down IMO. That should drive the value of homes downward in most cases. So, the housing "bubble" has begun to "leak" on it's way to an eventual "burst," over the next three to six months IMO. Sell now, if you plan too. Don't buy for at least six months. If you have ever considered refinancing your home or taking out loans for whatever other reason, now is the last best chance for currently near-record low interest rates IMO. Even if you are just thinking about borrowing or doing a refi, lock your rate in ASAP and then decide whether to proceed or not!
RayR Offline
#382 Posted:
Joined: 07-20-2020
Posts: 5,140
Who could have seen that coming? Transitory inflation is really now entrenched inflation. Laugh
The Wall Street junkies are going to have severe withdrawal symptoms with only a teensy increase in interest rates.
rfenst Offline
#383 Posted:
Joined: 06-23-2007
Posts: 36,329
RayR wrote:
Who could have seen that coming? Transitory inflation is really now entrenched inflation. Laugh
The Wall Street junkies are going to have severe withdrawal symptoms with only a teensy increase in interest rates.

No. Wall Street will still profit no matter what occurs.
Speyside2 Offline
#384 Posted:
Joined: 11-11-2021
Posts: 1,620
Ray, how do you invest your discretionary income?
tonygraz Offline
#385 Posted:
Joined: 08-11-2008
Posts: 18,026
I heard Ray is investing in non-binary activities.
HockeyDad Offline
#386 Posted:
Joined: 09-20-2000
Posts: 42,828
Speyside2 wrote:
Ray, how do you invest your discretionary income?


Scratch offs!
rfenst Offline
#387 Posted:
Joined: 06-23-2007
Posts: 36,329
Speyside2 wrote:
Ray, how do you invest your discretionary income?

Land, slaves, agricultural supplies, tobacco seeds, construction materials, furnishings and such,just like his hero Thomas Jefferson. Wouldn't it be ironic (and sad) if RayR were broke, perpetually in debt and had to sell his home off, just like Jefferson had to sell off Monticello?
RayR Offline
#388 Posted:
Joined: 07-20-2020
Posts: 5,140
rfenst wrote:
Land, slaves, agricultural supplies, tobacco seeds, construction materials, furnishings and such,just like his hero Thomas Jefferson. Wouldn't it be ironic (and sad) if RayR were broke, perpetually in debt and had to sell his home off, just like Jefferson had to sell off Monticello?


Hey! Don't you talk chit about Tommy man! ram27bat
Sunoverbeach Offline
#389 Posted:
Joined: 08-11-2017
Posts: 10,089
My wife was upset that I have no sense of direction. So I packed up my bags and right
rfenst Offline
#390 Posted:
Joined: 06-23-2007
Posts: 36,329
RayR wrote:
Hey! Don't you talk chit about Tommy man! ram27bat

Oh, so now you are on a first name basis with a dead guy?
Sunoverbeach Offline
#391 Posted:
Joined: 08-11-2017
Posts: 10,089
^^ All the best lunatics are
frankj1 Offline
#392 Posted:
Joined: 02-08-2007
Posts: 41,266
Sunoverbeach wrote:
My wife was upset that I have no sense of direction. So I packed up my bags and right

today may be your best batch
Speyside2 Offline
#393 Posted:
Joined: 11-11-2021
Posts: 1,620
Funny that, ask Ray a direct question, either no reply, or a reply so convoluted it brushes off your question and runs to his dogma.
Sunoverbeach Offline
#394 Posted:
Joined: 08-11-2017
Posts: 10,089
frankj1 wrote:
today may be your best batch

Thanks!

*Disclaimer* current entries are no guarantee of future quality
frankj1 Offline
#395 Posted:
Joined: 02-08-2007
Posts: 41,266
that's what dogma do
RayR Offline
#396 Posted:
Joined: 07-20-2020
Posts: 5,140
Speyside2 wrote:
Funny that, ask Ray a direct question, either no reply, or a reply so convoluted it brushes off your question and runs to his dogma.


Is NONE OF YOUR FRANKING BUSINESS a good enough answer for ya? ram27bat
frankj1 Offline
#397 Posted:
Joined: 02-08-2007
Posts: 41,266
plastics
rfenst Offline
#398 Posted:
Joined: 06-23-2007
Posts: 36,329
How full is the U.S. recovery? Inflation’s impact obscures the answer.

The nation’s G.D.P. has outpaced the growth rate that preceded the pandemic, until you take higher prices into account.


NYT

Here’s a notable fact about the U.S. economic recovery: Inflation-adjusted output last quarter was just 1 percent below where it would have been if the pandemic had never happened.

Here’s another one: Ignoring inflation, output is 1.7 percent above where it would have been absent the coronavirus.

Those two facts help explain the confusing, contradictory nature of the late-pandemic economy. On the one hand, the recovery has been remarkably swift by both historical standards and compared with what forecasters expected when the crisis began. On the other hand, a surprising surge in inflation is preventing the economy from rebounding more quickly, or feeling more normal. And to some extent, the same forces — the remarkable levels of aid provided by the government, and the unusual nature of the pandemic recession itself — are responsible for both trends.

The chart below helps tell the story. Inflation-adjusted gross domestic product (the dark blue line) has rebounded sharply since the early months of the crisis, but has yet to return to its prepandemic trend. That might not seem too surprising; businesses have mostly reopened, but the pandemic is still restraining daily activities, at least for many people.

But the second line on the chart, in light blue, shows that the story is a bit more complicated than that. In non-inflation-adjusted terms, gross domestic product — in simple terms, everything we make and spend in a given three-month period — has surged significantly beyond its pre-Covid trend. In dollar terms, we are producing and spending as much as ever. But because of inflation, those dollars are worth less than before.

In nominal terms, economic output has surpassed its prepandemic trend. But adjusted for inflation, it still hasn’t caught up.

The basic story here is simple. The reopening of the economy after the initial lockdowns brought a surge in demand, which was bolstered by the trillions of dollars in aid that the federal government provided to households and businesses. But supply chain bottlenecks, labor shortages and other issues meant that businesses could not fully meet that demand. Strong demand plus limited supply is a recipe for inflation.

What happens next is less clear. If companies are able to hire more workers and pick up production, then supply will be able to meet demand. In that scenario, the dark blue line would start to look more like the light blue one — growth would be strong in terms of real output, not just nominal dollars.

But if supplies can’t rebound, then either we will continue to burn off excess demand in the form of inflation, or demand will have to fall. Either scenario would make it harder for the economy to rebound fully from the shock of the pandemic.
Sunoverbeach Offline
#399 Posted:
Joined: 08-11-2017
Posts: 10,089
Son: Dad, if I told you I was gay, would you still love me?
Dad: Don't be silly, son. You were an accident. I never loved you in the first place
Dg west deptford Offline
#400 Posted:
Joined: 05-25-2019
Posts: 2,560
I always open this thread hoping for a stock pick, fund, etf, high dividend to P/E ratio, even a short put option but

Noooooooo

Scratch-offs is it I guess
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