The hottest Inflation Substack posts right now

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BOJ Finally Pulls the Trigger on Rate Policy, But It’s a Low-Caliber Gun

Japan Economy Watch • 259 implied HN points • 20 Mar 24
💰 Finance Inflation
  1. BOJ's interest rate policy tweak is more about changing the mechanism to keep rates low, gradually raising overnight rates from negative to low positive percentages over time.
  2. Ending Yield Curve Control means BOJ stops directly controlling long-term rates but still aims to keep them low by continuing to buy the same amount of long-term bonds.
  3. BOJ remains focused on low inflation and plans to raise interest rates if it rises too high, but for now, it sees current inflation as temporary due to global factors.

3 Ways out of our "Fiscal Death Spiral."

cryptoeconomy • 707 implied HN points • 08 Jul 23
💰 Finance Inflation
  1. There are 3 ways to escape the fiscal crisis: reduce spending, raise taxes heavily, or resort to printing more money.
  2. The increasing debt and interest payments are approaching unsustainable levels, potentially leading to historic inflation rates.
  3. Regardless of the chosen path, the final destination seems to be inflation as the most likely outcome of the fiscal crisis.

​ GDP=C+G+I+NX

Points And Figures • 772 implied HN points • 04 Mar 25
💰 Finance Inflation
  1. GDP is an important measure of how well an economy is doing. When GDP goes up, it usually means people are earning more and living better.
  2. Different economists have different views on government spending. Classical economists often see it as a negative thing for the economy, while Keynesians believe it can be beneficial.
  3. Current economic uncertainty affects business investment decisions, making it tough for the economy to grow. However, there are signs of recovery, like increased merger activity.

Daily Chartbook #278

Daily Chartbook • 3694 implied HN points • 13 Sep 23
💰 Finance Inflation
  1. The median U.S. asking rent in August was just below the record high set a year earlier.
  2. Commercial real estate prices are expected to decrease this cycle, ranging from -15% for apartments to -40% for office spaces.
  3. Small businesses are facing challenges with credit conditions and labor quality.

The US Must Return To A Gold Standard

QTR’s Fringe Finance • 25 implied HN points • 26 Jan 26
💰 Finance Inflation
  1. The dollar has been heavily debased over time because the government and the Fed keep creating money, which erodes purchasing power and risks a currency collapse.
  2. Reinstating a gold standard—by promising future redeemability of dollars for gold at the market price and never suspending that promise—would force strict monetary discipline.
  3. Without a hard money anchor like gold, politicians will keep hiding the real costs of spending and war through inflation, so only a gold-based system can deliver lasting monetary stability.
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Bank of England holds rates, but...

Off to Lunch • 334 implied HN points • 01 Feb 24
💰 Finance Inflation
  1. The Bank of England decided to keep interest rates at 5.25%, despite a split vote among committee members.
  2. Inflation is still high in the UK at 4%, above the Bank's 2% target, but recent data suggests a slowdown in the economy.
  3. The Bank's monetary policy report hints at inflation potentially dropping to 2% in the near future, but interest rates may not be cut until sustained evidence is seen.

All eyes are on the Fed, now more than ever

Stay-At-Home Macro (SAHM) • 648 implied HN points • 21 Mar 23
💰 Finance Inflation
  1. The Fed faces a tough decision on interest rates amidst banking turmoil and high inflation.
  2. Regardless of the rate decision, the Fed will signal that inflation is too high and more rate increases may be needed.
  3. There are signals that inflation may turn down notably by summer, with relief coming in several areas.

Fed Pivots to More Hikes, More Pain

cryptoeconomy • 648 implied HN points • 10 Jun 23
💰 Finance Inflation
  1. The Federal Reserve is planning more interest rate hikes and tightening measures, signaling potential economic pain.
  2. Despite initial expectations of a pause in rate hikes due to economic impacts not yet fully realized, Fed Governor Waller is advocating for further hikes to curb inflation.
  3. Quantitative Tightening, the reversal of money printing, may be the next step for the Fed despite past failures, raising concerns of potential economic disruptions and widespread impacts.

Blaming Capitalists and Workers for Inflation

cryptoeconomy • 628 implied HN points • 29 Jul 23
🇺🇸 U.S. Politics Inflation
  1. Central bankers are blaming capitalists and workers for inflation to divert attention from their own actions.
  2. Corporate profits and worker wages are being scapegoated for causing inflation, but in reality, they are a result of economic uncertainty and money printing.
  3. The evolution from 'greedflation' to 'wageflation' is explained by the Cantillon effect, where trillions of dollars trickle down from government to workers, resulting in lost real wages and potential future economic challenges.

Inflation: it's "complicated"

Stay-At-Home Macro (SAHM) • 628 implied HN points • 25 May 23
💰 Finance Inflation
  1. Inflation is influenced by a variety of factors such as supply disruptions, commodity prices, labor market strength, and demand for goods.
  2. The discussion around workers having the upper hand in the labor market is complex and requires consideration of inflation expectations, wage growth, and job market tightness.
  3. Inflation expectations are stable, showing that markets and consumers anticipate a return to normal inflation levels, which is crucial for combating inflation.

Chartbook 346: Against overcorrection. Yellen's Treasury defends the legacy of Democratic fiscal policy.

Chartbook • 815 implied HN points • 17 Jan 25
🇺🇸 U.S. Politics Inflation
  1. When a political party loses, there’s a temptation to rethink past policies. Critics may blame inflation on spending decisions, but the Democrats didn't do as poorly as expected in recent elections.
  2. Inflation feels different depending on your political views. Partisanship affects how people perceive the economy, making it hard to pin down economic sentiment just to inflation rates.
  3. Despite losing to Trump, the Democratic fiscal policies in recent years were effective. Inflation rates have fallen and job numbers have remained strong, suggesting that bold policy decisions can be successful.

Repost: Armed conflict investor survival guide

Klement on Investing • 6 implied HN points • 19 Feb 26
💰 Finance Inflation
  1. Don’t panic — most geopolitical shocks don’t hurt equity performance beyond a few weeks, so avoid rushing to sell and consider buying risky assets when they dip.
  2. Use a simple checklist before acting: ask whether infrastructure is damaged, whether inflation will stay high, and whether real interest rates will shift, since each outcome calls for different sector decisions.
  3. Only make major portfolio changes if the effects are persistent (more than a year) on inflation, earnings, or rates; short-term market fear is usually noise and a buying opportunity.

2024 Predictions

The Dollar Endgame • 359 implied HN points • 13 Jan 24
💰 Finance Inflation
  1. The Federal Reserve is likely to start cutting rates by Q2 or Q3 and possibly implement quantitative easing, based on recent signals and market predictions.
  2. There is an anticipation that the Fed will eventually restart quantitative easing due to factors like high deficits and pressure from the Monetary Black Hole, impacting financial markets and assets.
  3. Inflation is expected to return in the near future as liquidity programs kick in, fiscal deficits grow, and government spending increases, potentially leading to economic challenges and a recession.

Thoughts on Inflation

America in Crisis • 139 implied HN points • 01 May 24
💰 Finance Inflation
  1. The reduced-price model shows how cycles in prices correspond to inflation, especially during wartime when inflation tends to be higher due to deficit spending.
  2. The quantity theory of money explains the relationship between economic activity, money supply, and inflation, showcasing the importance of monetary factors in historical economic events.
  3. Analyzing the current inflation outlook using the money balance model highlights the potential for continued inflationary pressures and the challenges the Federal Reserve faces in managing inflation through interest rate adjustments.

Europe pays more for banned Russian oil, resold by India - as EU wages fall

Geopolitical Economy Report • 538 implied HN points • 05 May 23
🌍 World Politics Inflation
  1. Europe is indirectly purchasing Russian oil through India at higher prices despite sanctions, contributing to de-dollarization and falling wages.
  2. Russian oil exports to Asia, particularly China and India, have increased significantly due to Western sanctions, shifting away from Europe.
  3. Real wages in the EU have fallen by 6.5% from 2020 to 2022 due to rising energy costs and a severe cost-of-living crisis, impacting poorer households the most.

Corporate profits were biggest driver of inflation in Europe, IMF admits

Geopolitical Economy Report • 538 implied HN points • 27 Jun 23
💰 Finance Inflation
  1. Corporate profits have been a major driver of inflation in Europe since 2021, with companies increasing prices more than the rising costs of imported energy.
  2. The IMF suggests that companies may need to reduce profit margins to help keep inflation in line with targets set by the European Central Bank.
  3. The study challenges the traditional view that inflation is solely caused by demand-pull factors, highlighting how excessive profit increases by corporations can also drive inflation.

Central Banking in the Age of Chaos-Monkey Tariff Threats: It Would Not Be That Hard for Fed Governor Chris Waller to Do His Job Professionally

Brad DeLong's Grasping Reality • 253 implied HN points • 18 Jul 25
💰 Finance Inflation
  1. Fed Governor Christopher Waller should push for an end to tariff chaos, which creates inflation risks. It's important for him to act professionally and prioritize stability.
  2. Current interest rates may need to go down since they could be too high for economic growth. The Fed should be cautious and not cut rates hastily amid ongoing tariff issues.
  3. The Federal Reserve's credibility relies on resisting political pressure. They should remind the Executive that stable economic policies need changes in how the government operates.

After inflation, deflation?

Off to Lunch • 255 implied HN points • 08 Feb 24
💼 Business Inflation
  1. Recent data shows deflation in the Chinese economy, affecting consumer prices and factory goods.
  2. Deflation poses challenges for businesses, as consumers may delay spending anticipating lower prices.
  3. Bank of England aims to maintain 2% inflation, highlighting the negative impacts of deflation on business profits and debt.

Why Did The BOJ Move Despite Conflicting Evidence on Wages and Prices?

Japan Economy Watch • 179 implied HN points • 21 Mar 24
💰 Finance Inflation
  1. The Bank of Japan's decision to make monetary policy changes despite unclear wage and price trends was questioned.
  2. There was no immediate financial market pressure on the BOJ to act, as rates were stable and not pushing past set levels.
  3. Conflicting data on wage trends created uncertainty, with various databases showing contradictory evidence, making predictions difficult.

The Bank of England's Jonathan Haskel on Inflation, Productivity, Brexit, and More

The Overshoot • 511 implied HN points • 13 Feb 23
💰 Finance Inflation
  1. The Bank of England is grappling with the challenges of high inflation, low GDP, and rising unemployment due to tight labor and energy markets.
  2. There is significant uncertainty in economic forecasts, leading to a cautious approach in monetary policy decisions.
  3. Brexit has had a major impact on the UK's productivity growth and economic performance, with factors like weak business investment and health-related inactivity contributing to the situation.

Wages Are Rising Faster than We Thought

The Overshoot • 255 implied HN points • 03 Feb 24
💰 Finance Inflation
  1. Wages in America are increasing more rapidly than previously estimated.
  2. The slowdown in wage growth predicted by the Federal Reserve may take longer to happen than expected.
  3. Revised data shows that wage growth has not slowed down and is persisting at about 5% per year.

"Soft Landing"? More Like "No Landing"

The Overshoot • 471 implied HN points • 18 Feb 23
💰 Finance Inflation
  1. The U.S. economy is showing strong growth despite persistent inflation and may accelerate further.
  2. Inflation is returning for manufactured goods, potentially putting upward pressure on prices.
  3. Interest rates may need to rise more than expected, leading to a disconnect with recent declines in real yields.

An Open Letter To Bill Maher

QTR’s Fringe Finance • 77 implied HN points • 09 Nov 25
💰 Finance Inflation
  1. The gap between rich and poor is getting bigger, which is a major problem that many people are angry about.
  2. Inflation is caused by poor choices in monetary policy, and both political parties share the blame for not fixing this issue.
  3. If we don't address these problems, we could face a serious crisis in the economy or a social revolt from those feeling left behind.

Why the Deep State Loves Tariffs

Common Sense with Bari Weiss • 579 implied HN points • 21 Jan 25
🇺🇸 U.S. Politics Inflation
  1. Tariffs raise prices for consumers, going against the goal of reducing inflation. It's a way for bureaucrats and lobbyists to benefit at the expense of everyday people.
  2. The system of tariffs is controlled by complex bureaucracies that aren't transparent. This means that the true impact and manipulation of tariffs can be hidden from public view.
  3. If someone wants to reduce the power of the government and its administration, getting rid of tariffs would be a good starting point.

Did Wages Really Rise The Fastest In 28 Years?

Japan Economy Watch • 439 implied HN points • 09 Jul 23
💰 Finance Inflation
  1. Wages per hour, not per month, need to be examined to truly understand wage growth
  2. The data showing nominal wages growth doesn't necessarily reflect a true increase in pay, as it may be influenced by other factors like scheduled hours of work
  3. The focus on nominal wages by the Bank of Japan is aimed at achieving a specific inflation target, which may not fully account for the real impact on consumers

Daily Chartbook #279

Daily Chartbook • 2279 implied HN points • 14 Sep 23
💰 Finance Inflation
  1. Mortgage demand at its lowest since 1996.
  2. Home prices near 1970 and 2008 levels, signaling a potential price normalization.
  3. National Financial Conditions Index suggests loosening financial conditions.

Yen’s Short-Term Fluctuations and Long-Term Weakness

Japan Economy Watch • 299 implied HN points • 14 Dec 23
💰 Finance Inflation
  1. Short-term fluctuations of the yen depend on interest rate gaps between Japan and the US, influencing investors to buy/sell yen.
  2. Long-term weakness of the yen is influenced by the competitiveness of Japanese exports, affecting the overall value of the yen.
  3. The purchasing power of the yen relative to its trading partners has decreased significantly over the past 50 years, impacting Japanese households and companies.

Hedging Inflation with Real Assets

In My Tribe • 622 implied HN points • 12 Dec 24
💰 Finance Inflation
  1. Investing in real assets like real estate, gold, and commodities can help protect against inflation. These assets are expected to appreciate more when inflation rises.
  2. Understanding profitability is key when investing. It combines rental income, appreciation, and interest rates to determine if an investment is worth it.
  3. Inflation-indexed bonds (like i-bonds) can be a good hedge but have limits on how much you can buy. They provide some safety against inflation, even though their performance can vary.

Saturday Macro: Fed Independence as Your Screentime-Limit Phone App

Brad DeLong's Grasping Reality • 199 implied HN points • 19 Jul 25
🇺🇸 U.S. Politics Inflation
  1. Legal independence for central banks isn't enough to protect them from political pressure. Even with strong legal backing, central banks can still feel the heat from politicians, affecting their decisions.
  2. Under recent political pressure, inflation expectations have increased, even if central banks don't change their policies. This can lead to higher actual inflation, damaging the credibility of these institutions.
  3. The economic outlook may be shifting downward, with slower growth expected in the future. Keeping inflation rates above 2% is becoming more crucial as the economy faces different challenges.

The Fed's Bullishness Is Pushing Up Rates

The Overshoot • 412 implied HN points • 21 Sep 23
💰 Finance Inflation
  1. The Fed is optimistic about the economy, expecting less need to suppress job market for inflation control.
  2. Fed officials anticipate keeping interest rates relatively stable in the coming years.
  3. There is a shift in Fed officials' projections, showing higher interest rates expected by end of 2024.

All Roads Lead to Inflation

Points And Figures • 746 implied HN points • 28 Oct 24
💰 Finance Inflation
  1. Inflation seems unavoidable and is likely to continue affecting the economy. It doesn't really matter who is in charge politically; the pressure on the markets suggests we're stuck with it.
  2. To manage during inflationary times, investing in commodities and hard assets like real estate may be smart. These investments can help preserve value even when the dollar weakens.
  3. The shift to private markets and sectors like technology and agriculture can offer chances to earn better returns that beat inflation. However, navigating these markets requires skill and good management.

Weekly Wrap

Syncretica • 373 implied HN points • 27 Oct 23
💼 Business Inflation
  1. China's overproduction impacting US semiconductor market
  2. China's surplus of batteries and semiconductors leading to dumping solar products globally
  3. China's improving hydro situation likely to impact coal imports and emissions

Americans' Incomes Are Rising Too Fast for 2% Inflation

The Overshoot • 393 implied HN points • 25 Feb 23
💰 Finance Inflation
  1. Americans' incomes have been rising rapidly, with a 10% increase in disposable income since last summer.
  2. This rise in income is leading to concerns about potential inflation, as increased spending may outpace production.
  3. The surge in employment income is a key factor in driving consumer spending and could impact inflation rates.

Softened Conditions

The Transcript • 379 implied HN points • 30 Oct 23
💰 Finance Inflation
  1. Consumers are spending through their excess savings accumulated during COVID
  2. Economic conditions are softening in several markets
  3. Higher rates are impacting larger ticket item purchases