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Edited: Feb 12

2/12/2025 Guess what Day It is: inflation report day

Not good news today for those expecting lower grocery prices.

Today’s reading is troubling. Inflation is up and it increased at the highest pace since August 2023. Oh oh.

Egg prices up 15%. The highest one month increase in eggs since June 2015. That’s almost 10 years for those bad at mathing. By the way, how and why did egg prices become the barometer of inflation? In any case, at these prices nobody’s house is getting egged any time soon.

If you are looking for good news, January in recent years has had a hot reading and subsequent months are better. So there is that.

Looks like we may only see one rate cut this year. Bad news. The only way the Fed knows how to fight inflation is by raising interest rates. It’s been that way forever. If any of you were alive in the 70’s and early 80’s you remember.

“There's no sugarcoating this. This is not a good print," Claudia Sahm, chief economist at New Century Advisors and former Federal Reserve economist, told Yahoo Finance's Morning Brief program.”

“We're back in the case of last year where we're going to have to see months and months — getting out of the first quarter — of better inflation data before the Fed gets comfortable with it. So it really does push the timeline probably into the second half of the year [if] this ends up being the outlier."

https://finance.yahoo.com/news/january-inflation-data-complicates-fed-plans-as-soaring-egg-energy-costs-push-consumer-prices-higher-153042150.html

10 comments

10 Comments

Daystalker

Feb 12

Let them eat eggs.

BigBallss

Feb 13

Replying to

yep. I like that. Would be great on a T shirt

Onikoroshi

Feb 12

two things drive inflation harder than anything else: Fed Rate and Money Supply

yet the Fed keeps promoting the nonsense that higher rates lead to lower inflation

am I wrong?

if the cost of money goes up, how is it not inflationary?

if the supply of money goes up, how is it not inflationary?

BigBallss

Feb 13

Replying to

Sir, since you ask, yes you are very wrong. There is a difference between M1 and M2

M1 measures the most liquid of cash available including that cash in circulation.

M2 is a broader term that includes "near" money such as money invested in short term assets.

Both are measured closely but M1 has a a direct effect on inflation because it is money in circulation that directly drives up the price of goods and services.

Reducing M1 takes cash out of consumers pockets which reduces the purchasing power of the consumer.

When interest rates go up it drives down M1 because consumers find that putting money into higher yielding savings accounts or other investment vehicles is more attractive than holding onto cash. So that's how higher rates suck cash (M1) out of the economy and thereby reducing inflation

Disclaimer I'm not an expert in economics beyond taking a few classes in business school. But this is something I watch closely and read about frequently.

Edited

Pasadena Trojan

Feb 12

Geraldo, could you please show us all your posts concerning inflation during Bidens 4 year disaster??? Or just Trump after 3 weeks???

I actually hope to be corrected here.

I’ll think higher of you.

SanClemente

Feb 12

Replying to

It’s laghable how desperate woketards are Trump to fail at anything. sc

BigBallss

Feb 13

Replying to

PT, I wrote on this board extensively about inflation, interest rates, the stock market and the Fed for as long as this board has been here. And I did it while trying to keep politics out of it. My original post says nothing about politics. Read it again, or better yet, see if you can find someone that can read it to you. I'm not trying to make this a Politics board, we already have one of those.

As far as the three weeks, I'm not the one that promised the end of wars, taxes, high groceries, tariffs and mass deportations on day one. Orange Jesus did and you believed it. i called bullshet on all of it. Don't get mad when I turn out to be right and you turn out to be gullible and deceived. Not my fault.

Edited

BigBallss

Feb 12

Java

Feb 12

Joe Biden's parting gift to America. Nice big middle finger. Problem is, he is completely unaware. Just wants that ice cream and watch his cartoons

BigBallss

Feb 12

Replying to

If only we had elected the guy who promised to bring down prices on day one we wouldn’t be in this position. /s

Mortgage rates boomed up 43 basis points the 10 year yield up 11 basis points.

As of 2 hours ago:

Edited