The hottest Inflation Substack posts right now

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"A Year of Moderation" Begins for the Construction Sector

The Sunday Morning Post • 58 implied HN points • 21 May 23
💼 Business Construction Economy Inflation Consumer spending
  1. Home Depot reported a 4.2% decline in sales for Q1 2023, marking the start of a period of moderation in the construction sector.
  2. Lower home construction numbers are impacting sales of materials like lumber and affecting big-ticket item purchases.
  3. Factors like higher interest rates, inflation, and economic uncertainty are contributing to the slowdown in the construction market.

January 2024 CPI Update

Erdmann Housing Tracker • 63 implied HN points • 14 Feb 24
💰 Finance Economic Analysis Monetary Policy Inflation Federal Reserve
  1. Reaction to monthly CPI updates often fails to consider the lag affecting the shelter component, leading to surprises in news interpretation.
  2. Market expectations of a Fed rate cut were influenced by the latest report, shifting them further in the future.
  3. Monetary measures like currency in circulation and M2 trended down post-Covid scare, while the Fed's balance sheet shrinks without obvious disruption.
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Deflation Nation?

Diane Francis • 339 implied HN points • 13 Dec 21
💰 Finance Inflation Economics Monetary Policy Market Trends Consumer behavior
  1. Inflation worries are often exaggerated due to flawed measurements like the Consumer Price Index (CPI). People react strongly to these numbers, but they might not tell the full story.
  2. The reported inflation rate in America is at a high of 6.8%, causing a lot of concern and discussion. It's important to look at the bigger picture and the methods used to calculate this figure.
  3. Traditional metrics may not accurately represent the current economic situation. Understanding the limits of these measurements can help in better navigating economic discussions.

¥/$ May Be Heading to ¥125

Japan Economy Watch • 239 implied HN points • 24 Mar 22
💰 Finance Currency Economy Trade Interest Rates Inflation
  1. The yen may be heading towards ¥125, which would be its weakest level in 20 years, mainly due to factors like interest rate gaps between US and Japan.
  2. The ongoing Russia-Ukraine conflict and supply chain disruptions are contributing to yen weakening, despite historical perceptions of yen as a safe-haven currency during crises.
  3. Japan's shift from trade surpluses to deficits impacts its currency, and a weak yen may no longer be seen as entirely beneficial, especially if oil prices keep rising.

Hitting Pause

The Last Bear Standing • 152 implied HN points • 14 Apr 23
💰 Finance Inflation Financial Stability Implications
  1. The Federal Reserve is likely to pause interest rate hikes soon, signaling a shift in monetary policy.
  2. Inflation has been influenced by significant increases in money supply during the pandemic, impacting consumer behavior and economic growth.
  3. Financial stability is a top concern for the Fed, potentially outweighing traditional inflation targets and leading to a pause in rate hikes.

The "New Normal" Mortgage Rate Range

CalculatedRisk Newsletter • 105 implied HN points • 15 Aug 23
💰 Finance Mortgage Rates Real Estate Federal Reserve Inflation Economy
  1. Real estate agents suggest that mortgage rates may decrease to around 5% or lower once inflation is back to the 2% target.
  2. Current 30-year mortgage rates are at 7.26%, significantly higher than the 3.5% to 5% range prior to the pandemic.
  3. Expectations do not foresee a return to 3% mortgage rates unless there is another crisis.

March 2024 Fed Meeting Preview

Erdmann Housing Tracker • 42 implied HN points • 19 Mar 24
💰 Finance Monetary Policy Interest Rates Economic Growth Inflation Housing Market
  1. Consider using NGDP growth to communicate monetary policy instead of targeting inflation with short term interest rates.
  2. The yield curve's dynamics indicate recessionary signals and potential rate cuts by the Fed.
  3. Economic growth predictions for 2024 suggest low inflation, steady GDP growth, and a possible decrease in target rates by the Fed.

Does A Weak Yen Really Help Japan?

Japan Economy Watch • 199 implied HN points • 12 Feb 22
💰 Finance Economics Currency Trade Income Inflation
  1. A weak yen has atrophied Japan's economic muscles as it relies on it like a crutch, impacting household income and overall economic growth negatively.
  2. Japan's export-driven growth fueled by a weak yen contrasts with Korea's growth driven by innovative products and efficiency improvements, leading to a significant difference in economic performance.
  3. The weak yen raises import prices and benefits big companies over consumers, showing how it indirectly transfers income and highlights the impact on inflation and household spending.

Forward Guidance

The Last Bear Standing • 133 implied HN points • 03 Mar 23
💰 Finance Monetary Policy Central Banks Inflation Interest Rates
  1. The Dot Plot is the Fed's way of showing where they think interest rates will go in the future.
  2. Yield Curve Control is when central banks adjust short-term and long-term rates to tackle inflation and maintain financial stability.
  3. The Fed's Dilemma involves trying to raise rates to tackle inflation while avoiding destabilizing long-duration assets and maintaining financial stability.

Path-Breaking Research Explains the Low U.S. Consumer Gallup Poll Readings

The People's Economist with Anthony Chan • 19 implied HN points • 09 Feb 24
🇺🇸 U.S. Politics Economy Inflation Interest Rates
  1. Consumers in the U.S. are feeling pessimistic despite strong economic indicators like GDP growth, low unemployment rates, and declining Misery Index, mainly due to concerns about inflation viewed as a severe economic hardship.
  2. Recent data suggests that Americans usually lag in incorporating the effects of inflation, with sentiment influenced by inflation readings observed 6 to 12 months prior, leading to a risk-averse approach among consumers.
  3. Consumer dissatisfaction might also stem from the rising prices of dining out compared to cooking at home, affecting restaurant spending and consumer sentiment.

The Start of Inflation As We Know It

Informer • 39 implied HN points • 16 Feb 23
💾 History Economics Inflation
  1. In the 1930s, Keynes developed a new theory of inflation linked to the proletariat's impact on history.
  2. Economic laws are foundational and apply universally, impacting real-world situations.
  3. Changes in wage dynamics, influenced by trade unions and economic factors, played a key role in reshaping inflation patterns.

Federal Reserve Policymakers Meet This Week and Ask: “Are We There Yet?”

The People's Economist with Anthony Chan • 19 implied HN points • 29 Jan 24
💰 Finance Economy Monetary Policy Inflation GDP History
  1. The Federal Reserve may lower policy rates due to a significant difference between core PCE and core CPI.
  2. The Fed might not need to act as the economy is thriving with high growth rates.
  3. Fed's caution is influenced by past inflation battles and current inflation metrics compared to historical data.

Feelin’ Fine

The Transcript • 79 implied HN points • 20 Feb 23
💰 Finance Economy Inflation Markets Consumers
  1. The economy seems fine despite initial concerns of it being worse.
  2. Consumers are still spending, and capital markets are beginning to overlook inflation.
  3. There are doubts about the Fed tightening aggressively without causing a recession, but signs are not showing any current recession threats.