The Worm Turns

1+ We published our macro narrative Monitors last week (attached here), and something really j
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Rafa Mayer
Member
Rafa Mayer

All of this makes me wonder if the next discussion about Inflation will be around the concept itself as opposed to its level.

My personal view is that Inflation as a concept has diminished greatly in its utility as an indicator of how well an economic system is functioning. Diversity of goods, diversity of consumption patterns, substitution effects on steroids (Amazon), speed of changes, sharing economies, etc, etc. are all meaningfully changed from when the idea of Inflation as it is currently understood was developed.

I mean seriously…in today’s data driven world where we can see the vast complexity of human interactions and we are starting to understand how much we don’t understand about people’s behavior…does anyone really believe that all of that can be reduced to a single target magic number that is supposed to be arrived at with monetary tools of dubious quality and that will make everything right as rain?

I certainly have my doubts.

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Barry Rose
Member
Barry Rose

I don’t believe that Ben was wanting to have a discussion on inflation, but to alert the pack to the media’s new attention to the inflation narrative. Stanley Druckenmiller recently said that there are 14 measures of inflation and 12 of them are over 2%. But if the media believes the Shadowstats CPI number of 10%, that will be the new Inflation! number that everyone knows that everyone knows. Ben’s ‘be careful out these’ is a warning to have clear eyes on what the media feeds us.

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Farmer Don
Member
Farmer Don

This website has been garnering more attention of late: https://chapwoodindex.com/

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Victor K
Member
Victor K

Maybe I can get this neophyte question answered here: if we produce more goods or burn money, that would be deflationary. Inversely, trashing goods or printing money would be inflationary. We produce more garbage (the true tell for wealth) than ever, so since inflation is quasi-steady, production is keeping up with our landfill culture? Right?

0
james stewart
Member
james stewart

Land-fill culture could be caused by the push for production.

0
james stewart
Member
james stewart

The push for production has different qualities at different times. For example, after wars it is so obviously virtuous.

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