Global Inflation
Global Inflation Interesting chart showing that inflation is largely a global phenomenon. Picture Source: J.P. Morgan Asset Management
Civilian Labor Force Growth vs. Inflation since 1962
Civilian Labor Force Growth vs. Inflation since 1962 This chart suggests that civilian labor force growth leads CPI by four years. Image: Bank of America Merrill Lynch
Labor Costs Lead Core Inflation by 6 Months
Labor Costs Lead Core Inflation by 6 Months Historically, U.S. labor costs have been a good leading indicator of core inflation, because when labor costs rise, companies tend to increase their prices. Image: Legg Mason
Eurozone Inflation and Brent Oil Prices
Eurozone Inflation and Brent Oil Prices This interesting chart shows the direct effect of brent oil prices (YoY % change) on euro area inflation. Image: Jeroen Blokland
U.S. 10-Year Breakeven Inflation Rate vs. Russell 2000 Index
U.S. 10-Year Breakeven Inflation Rate vs. Russell 2000 Index Could this interesting correlation persist over time? Image: Hayek and Keynes
How to Get Inflation?
How to Get Inflation? Mainly, inflation comes from excess money supply growth. There is too much money in the system chasing too few goods and services. Nominal GDP = M x V = P x T M = quantity of money V = velocity of circulation of money P = level of prices T =…
Why the Fed Can’t Raise Interest Rates Above Inflation Rate, Today?
Why the Fed Can’t Raise Interest Rates Above Inflation Rate, Today? The Federal Reserve can’t raise the Fed funds rate above the inflation rate because the US productivity growth is too weak.Net Domestic Investment to GDP is in a long-term downtrend and reduces productivity.This makes it difficult to see the Fed funds rate exceed the…
Where Does Inflation Come From?
Where Does Inflation Come From? Mainly inflation comes from excess money supply growth. There is too much money in the system chasing too few goods and services. Over the long term, Nominal GDP = Money Supply x Velocity of Money = Inflation + Real Economic Growth “Inflation is always and everywhere a monetary phenomenon.” –Milton Friedman. You…
Why Is Core Inflation So Low Compared to Previous Business Cycles?
Why Is Core Inflation So Low Compared To Previous Business Cycles? The Consumer Price Index Less Food & Energy (Core CPI) is very low compared to previous business cycles in the US, for several reasons: – not fast-rising money supply – globalization: inflation is a global phenomenon – lack of wage acceleration – increase in…
Is Inflation Dead?
Is Inflation Dead? Is this cover of Bloomberg Businessweek a contrarian indicator? Remember that dinosaurs evolved into birds over 50 million years. Do you think we will have to wait 50 million years for inflation to return? You may also like “How to Get Inflation?” and “Where Does Inflation Come From?“ Image: Bloomberg