Transitory Eh? Uh, No


by Karl Denninger, Market Ticker:


The all items index rose 6.2 percent for the 12 months ending October, the largest 12-month increase since the period ending November 1990. The index for all items less food and energy rose 4.6 percent over the last 12 months, the largest 12-month increase since the period ending August 1991. The energy index rose 30.0 percent over the last 12 months, and the food index increased 5.3 percent.

Note the graph.  Note also that the start of this was roughly March of this year.  What have I said for over a decade: Policy changes require about a year to 18 months to show up in the CPI.

When did we start throwing money at the problem?  In March of 2020 and who did that?



When did the problem show up?

Almost exactly one year later.

What else does this tell us?

If we stop today, and we’re not with one big spending bill already passed and another on deck, it will be another year, at least, from the time we stop until the stupid begins to subside.

Of particular harm to consumers in the tables are:

  • Piped gas, up 26% from last year.  You don’t heat your house with natural gas, do you?
  • Fuel oil, up 59% (!!!!!) from last year.  God help you if you need heating oil.
  • Gasoline, up 49.5% from last year.  You don’t use that, do you?

Food was a “piker” by comparison, up “only” 5.4%.  Of course if you’re not well-off you spend a wildly-disproportionate amount of your money on food.  Between that and trying to stay warm this winter you’re screwed.

Food inflation was particularly bad this month, up 1% on the month alone.  That’s a 13% run rate annualized.

Don’t think you get away from this with the power bill — it’s up 6.5% from 12 months ago and a huge part of that is the demand to keep going toward “green” energy sources, which are wildly more-expensive and less-reliable.  Thanks Joe.

Healthy (that is, protein and fat based foods) were up double-digits almost without exception.  Ham and Chicken managed to remain under 10%, but not by a lot.  Obesogenic foods such as potatoes were only up 1.7% and candy was up 1.6%.  Have some more dieeeeeebetus peasants!

Propane is a monster kick in the nuts as well, up 34.7%, along with firewood and kerosene.  Who uses those?  Rural people, mostly.  Congratulations to Brandon there, along with the rest, but don’t feel singled-out as the city and suburban dwellers got bent over the table on natural gas also.  We must spread the love, you know, whether you want it or not.

Hope you don’t need appliances; they’re up big too, especially minor little things like a washing machine (14.9%.)  Laundromat owners rejoice — and add another slot to the coin drop.

One bit of good news: If you drown your sorrows and remorse for cheering on all this stupidity in the bottle that’s only up 2.2%.  A bargain, up until it destroys your liver of course.

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