INFLATION--here we go again...

Discussion in 'West Mall' started by Chop, Nov 30, 2021.

  1. Chop

    Chop 10,000+ Posts

  2. Chop

    Chop 10,000+ Posts

    • WTF? WTF? x 1
  3. Chop

    Chop 10,000+ Posts

    Don't bet on inflation going away soon

    Unless inflation is controlled—even at the expense of a bad recession, as was required in the early 1980s to stop the inflationary spiral of the late 1970s—"workers will not see meaningful increases in their purchasing power."

    As usual, the root cause of the inflation crisis is an overly loose monetary policy. When there are more dollars chasing the same number of goods, prices will rise.

    And then Harvard economist Jason Furman uttered the forbidden word:

    "Furman believes the economy is headed for a period of "stagflation," which he describes as an "ongoing hard landing" in which unemployment rises and inflation falls, but not to the Fed's desired levels."
  4. Chop

    Chop 10,000+ Posts

    - Diesel Shortage, esp. in the SE

    - Potential Railroad Strike in mid-November

    U.S. faces inflation timebomb poised to explode just before the holidays

    The U.S. Diesel Shortage Is Worsening |

    Fuel company issues diesel shortage warning, says conditions 'rapidly devolving'

    A railroad strike of the size planned for mid-November could bring the supply chain to a halt and cost the U.S. up to $2 billion a day, CNBC reported.

    "We estimated that even though the freight market has softened, a rail strike could result in significant increases in trucking spot rates, and high diesel prices will definitely make that worse," Danaf said.

    The combination of a diesel shortage and a railroad strike would be the worst-case scenario for the economy, with the potential to cause inflation to spike even further right before Thanksgiving and the holiday season.


    Mansfield Energy issued the alert Friday stating there was a developing diesel fuel shortage in the southeastern region of the United States. The company speculated that the shortage could be generated from "poor pipeline shipping economies" and a historically low supply of diesel reserves.

    "Poor pipeline shipping economics and historically low diesel inventories are combining to cause shortages in various markets throughout the Southeast," the company said. "These have been occurring sporadically, with areas like Tennessee seeing particularly acute challenges."
    • poop poop x 1
  5. Chop

    Chop 10,000+ Posts

    Don't worry folks.
    It's gonna be OK.

  6. mchammer

    mchammer 10,000+ Posts

    There is excess inventory in retail goods that are causing actual price decreases. My athletic shoes are 10% cheaper this year than last year.
    • Hot Hot x 1
  7. Chop

    Chop 10,000+ Posts

    That's good to hear, I guess...

    Buzz in the auto markets is that there's a lot of inventory accumulation of both new and used cars now...

    Housing is coming down, and may fall more with rising interest rates.

    Maybe it will all work itself out?

    Then again, diesel shortages, other energy market stuff going on, wages going up, heavy gov't spending, etc. weigh in favor of continued high inflation.
  8. Chop

    Chop 10,000+ Posts

    They're rationing heating oil in the Northeast.
    And winter hasn't even started.

    New England, New York ration heating oil even before peak winter - The Boston Globe

    New York and New England begin rationing heating oil before winter | Daily Mail Online

    Bloomberg - Are you a robot?

    The measure, designed to prevent panic buying, highlights the extreme fuel tightness across the New York Harbor and New England regions that has attracted the attention of the White House. National Economic Council Director Brian Deese told Bloomberg Television earlier this week that diesel inventories are “unacceptably low” and “all options are on the table” to bulk up supply and cut costs to consumers. In New England, where more people burn diesel — the same product as heating oil — to warm their homes than anywhere else in the country, stockpiles are a third of typical levels for this time of year, government data show.

    A main hurdle to replenishing regional fuel supplies has been a steep, sustained backwardation in the diesel market. Backwardation happens when prompt deliveries are priced at a premium over deliveries in the future, which in effect causes product to lose value over time. “There’s just no incentive to store large amount of product,” said Michael Ferrante, president of the Massachusetts Energy Marketers Association.

    In addition to the scarcity, there’s also the cost. Wholesale heating oil in New York Harbor averaged $4.09 a gallon on Thursday, compared with $2.46 at the same time a year ago
  9. Chop

    Chop 10,000+ Posts

    Free suggestion to the Northeast US worried about the cold and energy supply:

    Open up unrestricted drilling in the Marcellus Shale--all of it, including NY State and all of Pennsylvania.
    • Like Like x 2
  10. Pickle_Nuts

    Pickle_Nuts Will travel with tickets.

    Lots of gas in the ground in Southern New York.
    • Agree Agree x 1
  11. mchammer

    mchammer 10,000+ Posts

    It’s not the drilling - it’s the cancellation of pipelines to the east coast. Multiple pipelines cancelled in last 10 years.
  12. Chop

    Chop 10,000+ Posts

    The Southern Tier of NY State is basically an extension of Pennsylvania, geographically speaking. Including the Marcellus Shale.
  13. Chop

    Chop 10,000+ Posts

    Yep. That's been a huge problem. It makes transport more difficult.

    With the Marcellus, the big gas is already there in Pennsylvania and the Southern Tier of NY State --- lots and lots and lots of it. Much more than the Barnett Shale held. I don't know if we're calling Central and Western Pennsylvania the "East Coast," but many pipelines would only need to be around 100-200 miles to get to the heart of the Eastern Seaboard.
  14. mb227

    mb227 de Plorable


    Even for the libtiles about to freeze their collective asses off, that is 100-200 miles too many of pipeline to be constructed. They literally WOULD freeze their noses off to spite the face...
    • Hot Hot x 1
  15. Sangre Naranjada

    Sangre Naranjada 10,000+ Posts

    Then let them.
    • Agree Agree x 2
  16. Pickle_Nuts

    Pickle_Nuts Will travel with tickets.

    Many of the pipes running in the Northeast were turned south with the Marcellus Utica gas. Also, the big line from the Rockies never lived up to potential because of the gas in PA and OH.

    Fracking being banned in New York is what’s holding things up. Aubrey McCelndon and friends did not do anyone any favors when they has casing integrity issues up there. CNX also had some pudding locations from communication.
  17. nashhorn

    nashhorn 5,000+ Posts

    Knew the continued depletion of the Reserves was a problem when it was first announced. What I was not aware of was that included diesel. Stupid
    • Agree Agree x 1
  18. SabreHorn

    SabreHorn 10,000+ Posts


    Keep in mind that the US requires low sulfur diesel only including all ships entering our waters and ports. When Chavez was alive, the Navy was actually buying MDO indirectly from him with THREE "middle men".
    • Hot Hot x 1
    Last edited: Nov 2, 2022
  19. nashhorn

    nashhorn 5,000+ Posts

    Regardless, stupid move to dump our reserves like that History be d******.
    • Agree Agree x 1
  20. Mr. Deez

    Mr. Deez Beer Prophet

    I don't want to hear any of you all ***** about gas prices again. I just paid €2.41 per liter. That is $9.11 per gallon. I don't think I've ever been ripped off harder for anything in my life.
    • WTF? WTF? x 1
  21. nashhorn

    nashhorn 5,000+ Posts

    Wow Deez, what is diesel running there? It must be out of sight.
  22. Mr. Deez

    Mr. Deez Beer Prophet

    I don't remember what they were charging for diesel. It was unusually expensive even for Germany. Most places I'm seeing right now are about €1.85 per liter (about $6.99 per gallon) for E10 (95 octane) unleaded. Diesel is about €2.05 per liter (about $7.75 per gallon).

    Still getting screwed, but they're at least taking you out for drinks and appetizers first
  23. Monahorns

    Monahorns 5,000+ Posts

    • Agree Agree x 1
  24. Chop

    Chop 10,000+ Posts

    Another Fed meeting.
    Another 0.75 rate hike.
  25. mchammer

    mchammer 10,000+ Posts

  26. Monahorns

    Monahorns 5,000+ Posts

    Sure. No one knows what the REAL market rate is. The Fed policy rate has to hit the REAL market rate. We have the Fed shooting in the dark. Instead of central planning, a market based interest rate system would have already adjusted before inflation occurred.
  27. Chop

    Chop 10,000+ Posts


    I just noticed that Ukraine used to own Russia.

    We should go back to this Europe.

    England was just England.
    Northern Scotland and Sweden seem to be ruled by the same family.
    4 kingdoms of Ireland.
    Denmark was a lawless anarchy.
    The Baltic states appear to be ruled by a Game of Thrones family
    Last edited: Nov 6, 2022
  28. mchammer

    mchammer 10,000+ Posts

    How is this possible if corporate profits are down?

  29. mchammer

    mchammer 10,000+ Posts

    Are these guys morons? Prices of raw materials and even goods are falling. Housing prices are falling. I agree labor inflation is the last, remaining factor but it’s not the key factor. The cost of labor is only a small percentage of most goods sold.

    “What today’s report tells you is that you now have two years of high wage growth, and so this cycle keeps building,” said Steven Blitz, chief U.S. economist at TS Lombard.

    The report “was clearly bad news for the Fed’s war on inflation,” said Jan Groen, chief U.S. economic strategist at TD Securities. “The report confirms the labor market remains the key factor keeping up underlying inflationary pressures in the U.S. economy.”
  30. mchammer

    mchammer 10,000+ Posts

    My prediction is that core inflation drops to 5% in Jan-Feb timeframe at the same time the fed rate is 5%. At that point, game over for inflation.
    • Like Like x 1

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