stock market was up today...

[Thunder Good-Oil]

Have to deal with CPI reports with calculation of Tax LIFO inventory for work. For the categories that I have to track, I can unequivocally say the reported CPI figures are BS..

So….

Companies that have lots of unsold inventory built up AND use LIFO for their tax P&Ls are going to be more profitable (after tax P/L) on their other set of books with the higher COGS. Will Biden be taking credit for knocking it out of the park?

 

[lawgator1]

Biden would have spent even more too. Build back broke was going to cost about 4 trillion. Was even trying to sell being able to bring down inflation by spending trillions more. What a loser. At the end of the day though, both parties are to blame. Sure, democrats wanted more money like they always do, but many republicans went along with these COVID packages and past "stimulus" packages. Washington spending money like this is equivalent to staying up and shooting tequila all night and then never expecting a hang over the next day.

Which is having the larger inflationary impact:

A) oil prices
B) stimulus spending
C) war in Ukraine
D) supply chain disruptions

I think it's A, D, and B and C tied for third.

 

[norrislakevol]

Which is having the larger inflationary impact:

A) oil prices
B) stimulus spending
C) war in Ukraine
D) supply chain disruptions

I think it's A, D, and B and C tied for third.

That's a really good question. I think A is number 1, maybe B is number 2. Everything goes up when energy prices are high....everything. However, it can depend on the what we are talking about specifically. A huge rise in cost for fertilizer and wheat would be the war, and not just oil prices. Some other individual items may just be because of a shortage, coupled with everything else. They all work hand in hand of course. You just laid out a quadruple whammy.

 

[Velo Vol]

 

[Thunder Good-Oil]

Which is having the larger inflationary impact:

A) oil prices
B) stimulus spending
C) war in Ukraine
D) supply chain disruptions

I think it's A, D, and B and C tied for third.

You left out rising labor costs. I think that and A-Oil is behind most of it. B and D are old news.

 

[lawgator1]

You left out rising labor costs. I think that and A-Oil is behind most of it. B and D are old news.

Yes but what is spurring wage inflation besides the tight labor market?

Things are so wacky. You go anywhere and it seems like the business is struggling to have personnel to handle anything. Restaurants are half empty but on a wait because they don;t have staff. Can't get a landscaper to even answer the phone. Where is everybody? Its weird.

 

[Orangeburst]

Yes but what is spurring wage inflation besides the tight labor market?

Things are so wacky. You go anywhere and it seems like the business is struggling to have personnel to handle anything. Restaurants are half empty but on a wait because they don;t have staff. Can't get a landscaper to even answer the phone. Where is everybody? Its weird.

Maybe the Rapture happened

 

[MurphyVol]

Which is having the larger inflationary impact:

A) oil prices
B) stimulus spending
C) war in Ukraine
D) supply chain disruptions

I think it's A, D, and B and C tied for third.

It's a lot of things but #1 might be the massive creation of new money in since 2020.

 

[hog88]

It's a lot of things but #1 might be the massive creation of new money in since 2020.

Yep, you can't shut production down AND pump money into the system to encourage consumerism.

 

[Thunder Good-Oil]

Yes but what is spurring wage inflation besides the tight labor market?

Things are so wacky. You go anywhere and it seems like the business is struggling to have personnel to handle anything. Restaurants are half empty but on a wait because they don;t have staff. Can't get a landscaper to even answer the phone. Where is everybody? Its weird.

IMO the huge payouts spoiled the entry level workers and disincentivized them to find work. $30k to sit at home was far better than $32k to work full time. Hopefully they’ll be running out of beer and pizza money soon and will have to start filling the crappy jobs. Or maybe the leaking southern border will continue to provide enough dishwashers and roofers and hotel room housekeepers.

 

[lawgator1]

IMO the huge payouts spoiled the entry level workers and disincentivized them to find work. $30k to sit at home was far better than $32k to work full time. Hopefully they’ll be running out of beer and pizza money soon and will have to start filling the crappy jobs. Or maybe the leaking southern border will continue to provide enough dishwashers and roofers and hotel room housekeepers.

I would agree with you perhaps 6 months ago but even that stimulus would not keep the lowest income workers solvent and lazy on their couches for this long.

 

[Vol737]

Which is having the larger inflationary impact:

A) oil prices
B) stimulus spending
C) war in Ukraine
D) supply chain disruptions

I think it's A, D, and B and C tied for third.

Stimulus spending on the aggregate for the last 15 or so years is prime culprit. $30T in debt and no end in sight, the Nanny state has quite likely hit the tipping point of no return. The other are simply responses to the inflationary spending spree.

 

[Thunder Good-Oil]

I would agree with you perhaps 6 months ago but even that stimulus would not keep the lowest income workers solvent and lazy on their couches for this long.

Those that are living with their parents.

 

[DC_Vol]

Yep, you can't shut production down AND pump money into the system to encourage consumerism.

That’s right. Inflation is about money supply and productivity. The primary reason we haven’t seen this already in the last 40 years are the consistent productivity gains.

Anyone thinking about the drivers of inflation saw this coming immediately: shutdowns (productivity drop) coupled with government checks (increased money supply) = inflation

 

[Thunder Good-Oil]

The bigger labor squeeze is from late 1950s and 1960s boomers as well as early GenXers taking early retirement after sitting out the pandemic rather than jumping back into the workforce. The numbers just don’t support replacing them and will continue for nearly 2 more decades. Companies that invest in or sell automation are in a favorable position IMO.

Maybe high wages will draw lots more retirees into the part-time openings.

 

[Velo Vol]

I would agree with you perhaps 6 months ago but even that stimulus would not keep the lowest income workers solvent and lazy on their couches for this long.

The drop off in the supply of migrant workers is certainly driving up labor costs.

 

[Thunder Good-Oil]

Food and energy. Bring on the fully documented workers from south if the border. Get the oil moving again - lease out that land. Get that pipeline construction cranked up. Build a few refineries. Fire up more nuke plants.

Doing nothing on the energy front will turn this into a massive, long term problem.

 

[volinbham]

The drop off in the supply of migrant workers is certainly driving up labor costs.

more people than ever are coming across the border - how do we have a drop off?

 

[Caculator]

more people than ever are coming across the border - how do we have a drop off?

They ain't commin' to work

 

[volinbham]

I would agree with you perhaps 6 months ago but even that stimulus would not keep the lowest income workers solvent and lazy on their couches for this long.

I'd argue that the shutdowns along with extended payments have changed behavior of enough people so that now they find ways to "work from home" and along with lifestyle changes they are not motivated to return to the traditional workplace.

So some is independent of extended payments but those payments enabled the new behavior long enough that it stuck for some. It doesn't take much of the work force to opt out to cause the labor shortage we see.

 

[volinbham]

They ain't commin' to work

my point is that overall migrant worker flow should be increasing given the large growth in migrants.

 

[Velo Vol]

more people than ever are coming across the border - how do we have a drop off?

It was depressed for almost two years.

 

[volinbham]

It was depressed for almost two years.

View attachment 462820

was, not is

 

[NorthDallas40]

The drop off in the supply of migrant workers is certainly driving up labor costs.

Given the very high usage rate of eVerify by employers in high paying industries I’d guess the illegal workforce angle is a red herring.

 

[allvol123]

Yes but what is spurring wage inflation besides the tight labor market?

Things are so wacky. You go anywhere and it seems like the business is struggling to have personnel to handle anything. Restaurants are half empty but on a wait because they don;t have staff. Can't get a landscaper to even answer the phone. Where is everybody? Its weird.

I believe anger comes after denial.

Try not to lash out at forum members.