Spiffy. :/
Have the day you voted for Muricans!!
Trump would take more if he could. And he will.
Inflation is always a distribution issue. If all the prices and wages went up at the same rate, the only thing being eroded is stockpiled wealth, and this would make the rich less rich. But that’s not how inflation works in a price shock like this.
The article says prices rose 3.8% and wages 3.6%. If that doesn’t sound like much difference it’s because it isn’t. The real issue is that the prices of gas and food have risen far more than other goods (and will continue to do so, probably). People with lower incomes spend a much bigger fraction of their income on those consumer goods.
Also, those 3.6% wage growth aren’t universal. The very lowest incomes haven’t all been lifted by that number.
One way to combat this is to raise minimum wage and strengthen unions so they can negotiate better wages. Of course, that would increase overall inflation a little more, so the rich don’t want that to happen.
Another way to combat this is to make heavy regulations such that US domestic oil production covers most needs, but the oil companies don’t want to miss out on record prices, and people have been taught that the government should never do things, and to let the market regulate instead.
Welcome to the market.
the “market” and its invisible hands are not a real phenomenon; they are directed by the owning classes and purpose built to keep that “just one more week and it’ll be ok when i get paid” feeling in millions of americans. it is, literally, all made up.
If only the actions of Trump affected Americans…
I don’t like being pessimistic, but…
The full impact of the oil shock from the Iran war won’t hit for a while yet.
Good job, well done, Trump.
The second half of this year is gonna be rough
Also, the suspending of the gas tax is a purposefully ticking time bomb to fuck over any Democrat that dares to bring it back because our infrastructure is crumbling.
“See, Democrats are the ones who raise gas prices!”
And sadly, it will work.
Is that inflation in the month of April, i.e. inflation for one month rather than an annual rate?
Yes, I know what the article says. It just doesn’t match real-world observations. Lies, damn lies, and statistics.
Usually inflation is calculated per month but over a full year. So this is inflation since april 2025
And the president isn’t worried about Americans’ financial situation. He said as much just today.
It’s actually ridiculous how Republican leaders are held to COMPLETELY different (aka NO) standards.
Meanwhile they were frothing at the mouth when Obama put mustard on hotdogs or wore tan suits lmfao
Republican leaderscapitalists.
Reminder that inflation isn’t a natural thing
It’s something intentional to discourage people from having savings accounts and make them feel like they need to invest to “beat inflation”.
We could 100% have zero inflation, it just wouldn’t benefit the wealthy.
Inflation is just a tax on trying to save money.
Partially true. It’s also an attempt to run away from deflation, which destroys economies. Holding a stable position with no inflation or deflation is not really possible in the real world.
Important to distinguish two types of deflation from each other.
Type one is the deflation that is caused by contraction of the money supply. In the current system if the M2 aggregate shrinks it causes deflation. Slowing economy causes bankruptcies which cause shrinking of M2 which looks as a deflation and forces more slowing down of economy as money gets scarce. Central banks inflate money supply to fight this kind of deflation. If you are not rich already, you will never see any money from these money bags.
Type two deflation is natural and happens organically with progress. We saw natural deflation for years in electronics, where it beated the inflation targets by central banks. And prices of electronics were going down in the whole sector without disturbance. Savings allows you to eventually buy more efficient products.
Type 2 in this case is not an overall deflation in the economy, just for one sector. It also seems hard to me to measure the inflation/deflation there since the sector doesn’t have the same products over time, constantly innovating. Are people spending less money on electronics now than they used to? I find that hard to believe.
M2?
M2 is one way to measure the total amount of money in the economy. M0 is all cash money in circulation. M1 is M0 plus all money that can be spent at will, for instance in checking and savings accounts. M2 includes M0 and M1, plus stuff like short term deposits and money market funds.
When M2 shrinks it means there’s less spendable money in the economy, so people spend less. Businesses tend to have to lower their prices to get people to buy. The value of a dollar (or a yen or whatever) goes up, which sounds awesome except for a few huge catches. Now it’s always better to hang on to money rather than exchange it for goods and services. It also weirdly increases the value of debt, so anyone who borrowed anything going into this is screwed. If you’re still reading there’s other stuff that happens like it becomes almost impossible to avoid mass layoffs and monetary policy basically implodes but this shit is boring and I want to go back to getting high and watching the Simpsons
Dunno, maybe some other agregate. Long time no see the economic theory. One of the Mx…
Money buying more goods/services than it did 2 years ago is called “progress” and is literally the entire point of human civilization…
Money being worth more than it was 2 years ago also means any debt you carry is suddenly worth more than it was when you borrowed it…
Exactly. Nobody is gonna say “I won’t buy food today because it will be cheaper tomorrow.” A man’s gotta eat.
Exactly, which is why poor people go bankrupt during deflation, while the rich can just save their money and get richer and richer without even taking risks or investing (no investment, no jobs)
The core of the problem is that deflation encourages and enables wealth hoarding. The rich get richer by doing nothing but sitting on the wealth they already have.
Got some bad news for you, inflation does this too given that the rich have access to investment vehicles that the poor don’t.
I would argue this is better for poor people, cause they can’t just keep all their money as investments
it will change what you eat and how you eat and how frequently you do it.
There is a balance though or else the system feedback breaks the economy. Too much deflation and the “progress” stops because it starts making more and more sense for people to hold off on spending their money as much as they can. As an extreme example, if you know you can buy twice as much of something for the same dollar tomorrow, you must really need that thing right now to justify not waiting for a day. Scale that behavior across the entire population and it can start producing real problems.
It would break the economy if people stopped buying shit they didn’t need. I really wish these numbers didn’t correlate to whether or not people had food or housing or healthcare, otherwise that sounds like a wonderful way to slow the erosion of the natural world at the hands of overconsumption
Sorry but the beliefs you’re expressing are deeply neoliberal (and false).
First of all, NOTHING is natural about money.
If people are saving in cash, then more and more money is removed from circulation, which leads to economic downturn (see any example of deflation in history). This is among the reasons why most countries aim for 2% inflation target.
Also, investment is important actually (shocker). If you don’t want to invest in business or anything you can invest in government bonds. That’s right, the entity that creates the money in the first place also gives you a tool to save your money and mostly beat inflation.
“We could have 0% inflation if we wanted” - No we can’t? If a raw material becomes scarce and the price goes up, the products have to increase in price too. These prices don’t go back down on their own, thats unfortunately not how markets work. That’s literally what this whole post is about.
markets and money are entirely human creations. Nothing about them is natural. Stop worshipping them.
If you’d have asked questions, you could have learned things…
Sure.
- What is the “natural” state of money?
- How could we in theory achieve 0% inflation and what do you estimate would be the side effects?
- You say that the wealthy create inflation to encourage people to invest. How does this benefit them?
It is natural. It’s something that is suppose to happen in a healthy economy. When businesses do well, they should increase wages, when wages increases demand for goods and services increases and supply decreases, when supply decreases cost goes up. That is inflation. It is normal when things are going correctly.
Currently everything is shitty and the Fed is throwing money at the economy to keep us out of a recession. They’ve been doing that since trumps first term and it’s the reason our debt is out of control.
It is natural. It’s something that is suppose to happen in a healthy economy. When businesses do well, they should increase wages, when wages increases demand for goods and services increases and supply decreases, when supply decreases cost goes up. That is inflation. It is normal when things are going correctly.
…
All of what you just said relies on an ever growing economy…
Something that on a (not even really consider how long humans have been around) long timeline isn’t possible.
It’s just not.
It’s like if Newton saw an apple fall from a tree, and immediately looked away before it hit the ground so he said that means gravity always accelerates a dropped item faster and faster and it will never stop even when the ground shows up it will just barrel thru the entire planet and out the other side…
The reason you think it can go on growing forever, is youre thinking on way too small of a timeline.
Like, that’s the main problem with today’s economy…
It doesn’t rely on ever growing economy. Again it’s normal. Ups and downs are normal. When demand pulls back due to high prices the economy is suppose to shrink, thereby going through something like a reset. The government tries to prevent that because people get mad when they lose their jobs and vote out whoever is in power at the time.
It is basic economics it has nothing to do with my ideology or ideas. You should check your ego because you think that every single country is dumber than you and hasn’t figured out how to balance their economies. Trust me you are not the first person on the planet to think about how to minimize or eliminate inflation.
when wages increases demand for goods and services increases
You slipped it in right there yourself. This consumerist mindset can only exist with infinite growth. It seems natural but that’s only because we’ve been immersed in growth for hundreds of years.
If I make $1 today and that dollar covers every necessity and basic luxury I could expect then there’s no reason I need to spend more. $2 can only provide diminishing returns on quality of life. I don’t need a second house because I get less than the X¢ of value from my primary residence for the cost of 2*X¢.
It’s reasonable for me to give that excess back in taxes/charity (allowing someone else the full $1 value) or even stash it in my mattress for a rainy day (deflationary pressure). The only reason for me to spend a portion on a second house [I’ll rarely use] or car [I won’t drive] or new hobby [I don’t have time for] is if advertising convinces me I’ll get $1+ QoL value from the purchase. But that’s a flat lie, as any study on happiness will tell you.
I don’t know where you’re getting this infinite growth idea. No one believes that or actually thinks that’s possible. You’re alluding to the fact that each CEO of a company cuts and cuts so that each quarter they can show growth but that has nothing to do with macroeconomics.
When people have money, they spend it. There are hundreds of years of consumer data to support that. The discovery of oil, the gold rush, the industrial revolution and countless other examples of periods of excess wealth that creates lots of jobs and lots of spending. You are also mentioning buying houses and multiple cars and stuff; that represents like 3% of the world population and shouldn’t even be brought up.
Also keep in mind we’re talking about real human beings. People with families and parents they need to take care of. It is only natural for a government to do what it can to minimize the effects of inflation so that people don’t go hungry or lose their jobs.
The discovery of oil, the gold rush, the industrial revolution and countless other examples of periods of excess wealth
These are all factors that drove down the value of goods & services via finite windfalls, negative externalities and production optimizations. Tapping an oil well is basically finding consumer goods in the ground and passing them around, with a bit of value sapped via supply chain inefficiency.
Currency is only a tool for distributing those goods & services, no more no less. You can’t give people “more money” unless there’s surplus goods to be had and a demand for them. If there’s not you’re just devaluing your currency.
A day of labor is worth a day of labor, full stop. In 0 BCE that produced 1/4 of a shirt and today, through complex supply chains and efficient tools, it can produce 4000. But there’s a hard ceiling on the market for shirts (scaling with the number of backs). Unless you grow that market (more shirts per back or more backs), there’s no reason for the labor. This applies to every good and service. [Fun fact, there are something like 100 billion garments made every year. Those tailors should already be out of work for 5+ generations ]
I bring up excess houses and cars because they’re the most obvious and extravagant examples of inflating consumption for no benefit. 50 people can ride one bus or you can burn more resources to build 50 cars to marginally improve their lives. We should be thinking critically about the opportunity cost of 8 billion cars vs 160k busses.
It is only natural for a government to do what it can to minimize the effects of inflation
It should be the government’s job to ensure goods and services are fairly and humanely distributed and that labor is being directed toward that goal. Tailors shouldn’t be punished for working themselves out of a job, but we also shouldn’t be artificially inflating consumption just to keep their factories running. That path can only be sustained by irresponsible growth and aiming for X% inflation is a tool to encourage that.
Ive already explained it as simply as I can and have nothing to gain from trying any harder. Whether or not you understand this, or anything else… just doesn’t matter.
Congrats, you “win”. I’ll never explain anything to your account again.
It would be foolish not to invest even if inflation were always 0. Present-day consumption is worth more than future consumption, but hoarding (as opposed to investing) in the absence of inflation trades present-day consumption for future consumption 1 to 1.
You can make very low-risk investments (effectively no more risky than just holding dollars) and still beat inflation (not by much) to end up with more real purchasing power than you had before. No one is being forced to spend money now or lose its value.
What kind of Republican leadership would we have if they weren’t buttfucking our economy like every other time they’ve had control in my lifetime?
Yeah, it’s crazy.
The only times we ever have balanced budgets/close to balanced budgets is under democrat leadership, and businesses consistently thrive under them too, with good economic indicators consistently.
Yet so many people still think republicans are “good on economy” and “good for fiscal responsibility”.
Poor one out for every person who justified electing him the first time despite the grab-them-by-the-pussy controversy with “He’s a good businessman”
Actually, don’t. I’m sure beer’s getting expensive over there lol
currently they are throwing out elections, purging voters, and stripping DNC state house privileges.
It’s death by a thousand cuts.
I’m seeing more people take public transit (I always have), more people at WinCo (low price store in pnw), I can’t imagine how turbulent/abundant the seas have been with streaming.
Our apartment has hook ups for washers and dryers, and I was putting that off/we’ve been content to use the communal washer/dryer space, but uhhh, I’m gonna get on that soon.
With all the money I’ll be saving with making changes I’ll be… right back to where I was at the start of this administration 😔
Its wild to me watching the prices that Winco has held steady for years start to creep up, so much credit to that store cause 100 dollars at Winco gets you so many more healthy calories than any other store I know of.
Best wishes from a fellow west coaster <3
It’s death by a thousand cuts.
Most likely the story of the remainder of our lives since Americans can’t get their shit together, do their homework, and elect better representatives.
On the clothes washing try seeing about organizing with everyone in the building to make the domestic labor be a communal endeavor. Much more affordable than getting an individual machine and you make friends and comrades
WinCo (low price store in pnw)
Shame they’re non-union, though.
They are employee owned, though, and having worked at one of their competitors who is union the UFCW is ass. Winco might also be terrible to work at, idk, I just gotta say that union did not help me at all.
I was kind of predicting this. The rise of oil price certainly put a dent to consumer power.
The plutocrats’ war on the poor. Make America Great Again?
Rose “to” 3.8%? Does the author of this article think the inflation rate is set at some fixed amount like an interest rate?
it rose compared to last month, when it was 3.3
that’s almost a 15% jump
