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| -Signs, Portents, and the Weather- |
| 'Inflation Storm' Looms as Expectations Hit 13-Year High, Consumer Sentiment Sinks |
| 2021-07-31 |
| [BREITBART] Americans expect more inflation this year and remain uneasy about the direction of the economy, the University of Michigan’s survey of consumers showed Friday. Expected inflation over the next year rose to 4.7 percent from 4.2 percent in June. That’s the highest level in over a decade. At least for now, however, Americans still believe that inflation will remain tame over the long term. Expected inflation over the next five years is just 2.8 percent, down from 3 percent in May. "While most consumers still expect inflation to be transitory, there is growing evidence that an inflation storm is likely to develop on the not too distant horizon. The improved finances of consumers have greatly reduced consumers’ resistance to price increases," said Richard Curtin, the chief economist of the survey. Curtin explained the possible dynamic for inflation lasting longer than thought: Consumers and firms currently justify their actions as temporary adjustments due to the pandemic. However justified, such changes act to generate an upward spiral in prices and wages. Moreover, the fiscal and monetary policies already in place, and the likely increases and continued accommodation now contemplated, will only increase the willingness of consumers and firms to act in ways that accelerate the upward spiral in prices and wages. The second and final reading of the University of Michigan’s consumer sentiment index showed a sharp decline to 81.2 in July from a reading of 85.5 in June. The current conditions component declined 4.6 percent and the expectations component fell 5.4 percent. In his analysis, Curtin says the falling income inequality will mean more spending power in the hands of the less well off. Because the propensity to spend is greater for the less wealthy, rising incomes will result in more spending, more growth, and more inflation, according to Curtin. "The booms will end in the same way as usual: rising prices will eventually outdistance wage gains, lowering living standards, and cause an economy-wide retrenchment in spending," Curtin said. |
| Posted by:Fred |
| #5 well put P2K |
| Posted by: Chris 2021-07-31 20:46 |
| #4 It's only a "transitory" price increase. You'll see. |
| Posted by: Besoeker 2021-07-31 19:27 |
| #3 Diesel is up $1.00 from two weeks ago. |
| Posted by: Skidmark 2021-07-31 19:07 |
| #2 Talk? They see it every time they fill up or go to the grocery store. It's the 'ruling' caste who have others do it for them that don't personally experience that enlightening. It's easy for them to shift from Whole Foods to Kroger. For those using Walmart there often is no shifting. It's easy for them to put off facing the impact once a month when the credit card bill comes. It's another when all you have is what treasury notes remaining in your wallet each an every time you make a purchase. |
| Posted by: Procopius2k 2021-07-31 11:39 |
| #1 Keep up with the inflation talk, people will not buy what they don't need; required - food, shelter, clothing, fuel for homes/transport, water and electricity. After that, its all elective or emergency (medical) spending. Good Luck trying to 'revive' the economy. |
| Posted by: Ebbirt Snore7983 2021-07-31 11:11 |