The Fed and the media played up the transitory term to try to cover Joe Biden's ass. We all know that if Donald Trump were President and inflation was that bad there is no way in hell they would call it transitory. The whole point of this thread was to point out that they were trying to sugar coat inflation so Biden didnt look bad. It was a complete lie. Then again, when has the media ever been truthful?
People use the media as an excuse for having a lame brain. Trying reading corporate earnings reports, one after the other is telling you and all of us that supply is still disrupted and they are unable to produce at normal levels. It’s a complicated issue and right wing people who use bad news sources are not willing to consider the massive impact Covid has had on the global economy. I see a lot of people lost in this mess trying to blame fiscal policy and spending and they are just totally missing what is actually happening. However, there is a legitimate argument that I and many others underestimated the length of time Covid would impact the economy as the world reopened. And that only means the situation will be worse than expected. So yes inflation is running longer than anticipated but that doesn’t change the root cause. edit to add to the point:
Ah, really. What would it be sitting at with an expanding balance sheet (which I know, just stopped as of yesterday)? The word "transitory" can be manipulated any way you want because of its subjectivity and relativity. Life is transitory. The sun is transitory. Nothing not absolutely permanent is transitory. Stop playing with words to fit a narrative. The Fed and Yellen thought inflation would be gone in a matter of months. Now they don't. Since they coined "transitory", and are saying it isn't now, we should probably go with their definition.
The inflation caused by the demand and supply chain limitations is structural now and here to stay no matter what Biden or the Fed declares. People need to realize that strong demand still exists and is driving product price inflation while supply chain inflation is still way above pre COVID levels. That will not drop because why should logistics companies drop costs when demand for their services is still high and capacity is almost fully utilized? For example freight rates from Asia to Mexico for a container was most likely $800-$1500 pre COVID. In March 2022 it hit $12,000 - $14,000. Right now probably closer to $8000 - $9000. This is just one of many examples. Those freight rates will not see $1,200 again unless we have a global recession like 2009. So the paradigm has shifted for logsitics costs to higher levels even when they settled down a bit next year. This inflation is here to stay. As someone dealing with logistics for years, it does not change on a dime.... it is a large dinosaur and logsitics operators making record profits like never before who always have to fight for business are not going to drop their rates until equipment is sitting dead and that aint happening in 2022.... probably not in 2023. Product demand is still strong and we are not even in busiest time of the year. That will kick in July - Sept and then into Xmas season. Gas is higher but so are earnings so we would have to do some complicated math to see what the REAL INFLATION effect truly is. No way to isolate it. 2022 is more of the same with some slow down due to rising prices. Until the bubble pops momentarily though it will continue. The Fed nor a president can do anything about it.... economies will have to settle towards the new equilibrium on their own. Increasing rates just puts artificial breaks that people overreact to. That is why rate hikes take a while to have any effect and then cause problems when they finally catch up. Presidents always get blamed for what is happening in the country at the time. Clinton during an economic boom; Bush during housing crisis, Obama during economic recovery, trump during continuation as well as COVID economy, Biden during aftermath of closing and rapid reopening.
I just explained it....using economics and finance. You just want to explain it as trump good biden bad. Notice how you did not mention inflation under Obama on a downward trend into 2016 election but that's how you see it rather than unbiased. Inflation maintains trends regardless of elections which are artificial. So inflation was out of control and trump suddenly magically reigned it in? If that is your argument then I will wait for your glowing Obama but both are bullshit. Inflation was starting to go up due to the reopening of markets globally and supply chain/demand crunch. Inflation was already hitting 4% in Jan 2021... nothing to do with trump or biden. 2021 was the main year for demand spikes and surge in freight rates, trucking rates, and logsitics cost. I can spend time showing you all the earnings reports from companies in 2021 who reported higher costs from increased logsitics from COSTCO to car makers importing chips from Asia. Notice how inflation was increasing in markets all over the world... but yeah Biden runs Brazil and Russia... this is nothing to do with trump but yet you believe it has something to do with Biden and he was not even president yet.. If you want to discuss this then use economics and finance, not biden bad... trump god. Sorry but there is no intelligent argument relating to either man. Global economies don't work that way. Was the below trump or the logsitics crisis in post covid economic reopening
May 2021 COSTCO: “Inflationary factors abound,” CFO Richard Galanti said on the company’s fiscal third-quarter earnings call Thursday. “These include higher labor costs, higher freight costs, higher transportation demand, along with the container shortage and port delays … increased demand in various product categories some shortages, various shortages of everything from chips to oils and chemical supplies by facilities hit by the Gulf freeze and storms and, in some cases, higher commodity prices,” he added
Automakers for more than a year now have been battling through a semiconductor chip shortage that has sporadically halted production of new vehicles, causing record-low inventories of vehicles and higher prices. The circumstances have pushed many buyers into the used-car market.