There is a common belief that a company can arbitrarily pick any price it wants for its products and then make obscene profits. And while it is true that a company is certainly free to set its prices, that doesn’t mean that consumers have to pay them. There are a variety of other factors at play. Does the company have a monopoly? How long would it take for the competition to gear up and start producing a competing product? How much demand is there for this product? How desperately does the consumer want/need this product? How expensive is it for the competition to get started? Is the monopoly due to a patent, government fiat, or temporary supply disruption? And many others. In the … [Read more...]
Annual Inflation Retreats in October
The Bureau of Labor Statistics reported that Annual Inflation for October 2022, fell from 8.20% to 7.75% Monthly inflation at 0.41% was still very high for a month in the fourth quarter, which is traditionally negative or at least very close to zero. But although high, October 2022 monthly inflation was still lower than in October 2021. So… Annual inflation for the 12 months ending in October 2022 fell to 7.75%. This was down from 8.20% in September 2022. Inflation Summary: Annual Inflation fell from 8.20% to 7.75% CPI Index rose from 296.808 to 298.012 Monthly Inflation for October was 0.41% Next release is December 13th October Annual Inflation was 7.75%. Jan. … [Read more...]
August 2022 is Actually Disinflationary
The Bureau of Labor Statistics reported that in August, Annual Inflation fell from 8.52% to 8.26% Inflation Summary: Annual Inflation fell to 8.26% from a peak of 9.06% in June CPI Index fell from 296.276 to 296.171. Monthly Inflation for August was -0.04% Next release October 13th August 2022, Annual Inflation was 8.26%. Jan. 2021 -- 1.40% | Jan. 2022 -- 7.48% | Feb. 2022 -- 7.87% | March 8.54% | Apr. 2022 --8.26% May 2022 -- 8.58% | June 2022 -- 9.06% | July 2022 -- 8.56%% | August 2022 -- 8.26% BLS Inflation Report: According to the BLS Commissioner: "The Consumer Price Index for All Urban Consumers (CPI-U) rose 0.1 percent in August on a seasonally adjusted basis … [Read more...]
Everything They Tell You About Inflation is Wrong
In today's article, J.R. MacLeod looks at the effects of inflation, the fraud it perpetrates on the population, and who benefits and who loses from inflation. He also shows that "Inflation is not necessary for real wealth and real growth... inflation is completely unnecessary for a growing and prosperous economy". ~Tim McMahon, editor Inflation, the Price Level, and Economic Growth: Everything the Elites Tell You about It Is Wrong Fundamentally, inflation is fraud. The central government or bank printing more money lessens the value of the money already in circulation. A truckload of sand isn’t particularly valuable in Saudi Arabia. An increased supply of money means that ultimately prices … [Read more...]
Two Ways to Destroy the Economy: Hyperinflation and Central Planning
In the following video, Professor Engelhardt says that if he were a "Super Villain" and wanted to destroy an economy, there are two ways that seem obvious to him. The first is "Central Planning", aka. "Socialism" and the Second is Hyperinflation. Since he would be a lazy super villain, he says Central Planning is "too much work", so he would choose hyperinflation. He goes on to say that hyperinflation is difficult to define; even Economists like Murray Rothbard and Ludwig Von Mises used different definitions of plain inflation depending on the context. Generally, inflation was originally defined as an "increase in the money supply in excess of the increase in the demand for money". More … [Read more...]
Gas Prices Fall, Bringing Down July 2022 Inflation
The Bureau of Labor Statistics reported that in July 2022, Annual Inflation fell from 9.1% to 8.52% Inflation Summary: July 2022 Annual Inflation fell to 8.52% CPI Index declined slightly from 296.311 to 296.276 Monthly Inflation for July was -0.01% down from 1.37% in June. The next release is on September 13th July 2022, Annual Inflation was 8.52%. Jan. 2021 -- 1.40% ** Jan. 2022 -- 7.48% ** Feb. 2022 -- 7.87% ** March 8.54% Apr. 2022 --8.26% ** May 2022 -- 8.58% ** June 2022 -- 9.06% ** July 2022 -- 8.56%% Crude Oil prices averaged over $107.10 per barrel for June and averaged $93.12 in July. While according to the AAA, Regular Gasoline prices averaged $4.99 … [Read more...]
Total U.S. Cumulative Inflation
How Much Inflation have we had since 1913? Just like compound interest, "compound inflation" grows faster and faster. So, even though the average annual inflation since 1913 has been "only" 3.24% PER YEAR. After over 100 years, the total cumulative inflation becomes astronomical. See Average Annual Inflation Rates by Decade to see how each decade stacked up. As you can see from the chart below, compounding something for over 100 years at 3.24% will result in well over 2000% inflation. The Consumer Price index (CPI-U) for January 1913 was 9.8. The CPI-U for July 2022 was 296.276. This means that something that cost $9.80 in January 1913 would cost $296.28 in July of … [Read more...]
2022: Highest June Inflation Since 1941
The Bureau of Labor Statistics reported that in June 2022, Annual Inflation rose to 9.1% Inflation Summary: Annual Inflation Rose from 8.58% in May to 9.06% in June CPI Index rose from 292.296 to 296.311 Monthly Inflation for June was 1.37%, the highest June since 1941 The next release is on August 10th June 2022, Annual Inflation was 9.06%. Jan. 2021 -- 1.40% ** Jan. 2022 -- 7.48% ** Feb. 2022 -- 7.87% ** March 8.54% Apr. 2022 --8.26% ** May 2022 -- 8.58% ** June 2022 -- 9.06% Crude Oil prices averaged over $100 per barrel for June. While according to the AAA, Regular Gasoline prices averaged $5.016 in mid-June. Monthly Inflation At 0.84% (January), 0.91% … [Read more...]
The Many Evils of Inflation
I grew up reading the works of Hans Sennholz, one of the leading thinkers of the Austrian Economics movement. The following article although originally published in 2005 is as timely now as it was then. He was the author and co-author of many books including Money and Freedom, Gold, Freedom, and Free Markets, The Politics of Unemployment, and Man Must Work (an idea that is certainly out of fashion now). Many of his works are out of print and difficult to locate now like Age of Inflation and Debts and Deficits. In 1972, the Congressional Record recorded his wild projection of the federal debt reaching $4 trillion by 1993, when the federal debt was less than $450 billion. The actual figure … [Read more...]
Inflation Takes a Bite Out of Your Food Budget
The Bureau of Labor Statistics reported that in May 2022, Annual Inflation Rose. May Food Inflation Breaks Record: The combined food index (at home and away) increased 10.1 percent for the 12-months ending May, the first annual increase of 10 percent or more since the period ending March 1981. Food at home rose even more... 11.9% over the last 12 months... while food away from home "only" rose 7.4% over the last year. All six major grocery store food group indexes rose in May. The index for dairy and related products rose 2.9 percent, its largest monthly increase since July 2007. The index for nonalcoholic beverages increased 1.7 percent, and the index for other food at home rose … [Read more...]
