Cents and Sensibility: the Inflation Guy Podcast Michael Ashton - the Inflation Guy

The economists were mostly on-target with today's CPI report, at least with the headline and core figures. But that doesn't mean that there was nothing going on underneath the surface. Below the big headlines, some things are getting better and some things...aren't. What does it all mean, and does the Fed have some cover to cut rates? Listen to this episode to hear the Inflation Guy's take on those questions!
 
NOTES
Blog for this month’s CPI: Inflation Guy’s CPI Summary (April 2024)
Important article: “The Inflation Management Opportunities In The Insurance Industry Today”
To Subscribe to Quarterly Inflation Outlook: https://inflationguy.blog/shop/
To Subscribe for free to the blog: https://inflationguy.blog/
Check out the website! https://www.EnduringInvestments.com/

"They couldn't hit an elephant at this distance!"
- General John Sedgewick, Union, US Civil War, moments before he was struck by a bullet in the eye.
The tradition of 'famous last words' is alive and well, especially at the Federal Reserve and Treasury. From Bernanke saying the subprime crisis would be contained, to Yellen and Powell describing inflation as 'transitory,' and far beyond - the track record of overly-confident predictions that ultimately turn out to be hilariously wrong is alive and well. In this episode, the Inflation Guy discusses the most-recent candidate, from last week...
NOTES
Blog Callback: “You Cannot Inflate the Debt Away”
Important article: “The Inflation Management Opportunities In The Insurance Industry Today”
Blog for last month’s CPI: Inflation Guy’s CPI Summary (March 2024)
Interesting Interactive CPI Chart the IG Didn't Even Mention But is Worth Looking At
To Subscribe to Quarterly Inflation Outlook: https://inflationguy.blog/shop/
To Subscribe for free to the blog: https://inflationguy.blog/
Check out the website! https://www.EnduringInvestments.com/

There are several pernicious myths about the velocity of money that seem to never die. "Friedman said velocity is stable." "Velocity is just a plug number, so it is random." "Velocity is permanently impaired and only declines over time." These drive the Inflation Guy bananas, and from time to time he feels the need to talk about velocity. In this episode, the IG describes the main inputs into his model of velocity, and what the model currently implies about the future path of velocity from here. And, to be fair, he also kvetches some, and that's unseemly. We apologize for him.
NOTES
Blog Callback: “Enough With Interest Rates Already”
Podcast Callback: “Ep. 50: What the Money Velocity Comeback Means for Inflation, and Investors”
Important article: “The Inflation Management Opportunities In The Insurance Industry Today”
Blog for this month’s CPI: Inflation Guy’s CPI Summary (March 2024)
To Subscribe to Quarterly Inflation Outlook: https://inflationguy.blog/shop/
To Subscribe for free to the blog: https://inflationguy.blog/
Check out the website! https://www.EnduringInvestments.com/

We don't know if the origin of the 'ten most dangerous words in the English language' was Ronald Reagan, or if the story predates him. But those words, "I'm from the government, and I'm here to help you," are the theme to today's podcast. The Inflation Guy interprets some recent news stories, but ties it all together with a crucial observation about what happens if the 'scarce resource' in a particular economy turns out to not be 'labor.'
NOTES
Dan Bongino Show from April 18 (https://megaphone.link/WWO9433765103 ). Listen from the 47 minute mark.
Forbes “Medical Analysis by Milton Friedman” (2009)
Washington Post “Biden administration to cap rent increases for some affordable housing units”
Blog Callback: “Inflation and Insurance Companies, with Bill Poutsiaka”
Important article: “The Inflation Management Opportunities In The Insurance Industry Today”
Blog for this month’s CPI: Inflation Guy’s CPI Summary (March 2024)
To Subscribe to Quarterly Inflation Outlook: https://inflationguy.blog/shop/
To Subscribe for free to the blog: https://inflationguy.blog/
Check out the website! https://www.EnduringInvestments.com/

On this month's CPI report, the Inflation Guy addresses yet another high-side surprise and discusses the details, along with how this fits into the continuing narrative. Curious about how this concerns ponies? You'll have to listen to the episode!
 
NOTES
Blog for this month’s CPI: Inflation Guy’s CPI Summary (March 2024)
To Subscribe to Quarterly Inflation Outlook: https://inflationguy.blog/shop/
To Subscribe for free to the blog: https://inflationguy.blog/
Check out the website! https://www.EnduringInvestments.com/

Okay, buckle up because the Inflation Guy here is going to cover some big-time concepts. Wayyyy back in 2003, some guys named Jarrow and Yildirim explained how inflation acts just like foreign exchange, except not foreign and not on an exchange. No, no, stay with me here. Turns out they were right, and a lot of what is happening today - and the mistakes in interpretation that are being made - can be understood if you understand that the 'inflation FX market' has just changed in important ways. This is an important episode!
 
NOTES
Jarrow R, Yildirim Y (2003) Pricing treasury inflation protected securities and related derivatives using an HJM model. Journal of Financial and Quantitative Analysis 38(2):337–359. https://papers.ssrn.com/sol3/papers.cfm?abstract_id=585828
Unidad de Fomento (Wikipedia entry): https://en.wikipedia.org/wiki/Unidad_de_Fomento
Chart: Nominal and inflation-adjusted Case-Shiller 10-City index, normalized to end of 2019
Chart: Nominal and Real S&P 500 Earnings, normalized to end of 2019
To Subscribe to Quarterly Inflation Outlook: https://inflationguy.blog/shop/
To Subscribe for free to the blog: https://inflationguy.blog/
Check out the website! https://www.EnduringInvestments.com/