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Diesel prices are way up, more than gas & oil, which will soon inflate producer prices; however lower Chinese demand for anything related to infrastructure & housing should offset in time. Regardless, Sticky CPI less food, energy, & shelter shows that this is NOT THE 1970's! fred.stlouisfed.org/gra…
I'm still looking for empirical evidenc…
Diesel prices are way up, more than gas & oil, which will soon inflate producer prices; however lower Chinese demand for anything related to infrastructure & housing should offset in time. Regardless, Sticky CPI less food, energy, & shelter shows that this is NOT THE 1970's! https://fred.stlouisfed.org/graph/?g=18RIq
I'm still looking for empirical evidence that a strong labor market predicts future inflation. It seem more theoretical than empirical, with the huge exception of Quit Rate to Average Weekly Wages or to lagged ECI. And the Quit Rate is plummeting. I've heard businessmen say that wage inflation needs to get down to 2% or below to keep general inflation at 2%. I think this is a widespread misconception, even infecting some economists, and perhaps even FOMC members? That needs to be addressed theoretically and with historical correlations. Right that column!
I keep looking at periods of high US inflation (Revolutionary War, Civil War, WWI + pandemic, WWII, Korean War, Israeli War, Iranian Revolution, pandemic + Ukraine War), but I just can't find the common denominators. If we could get back to that zeal for a balanced budget then we could push the CPI into deflation (once shelter catches up). But this Republican House seems too incompetent to pull off anything.