Kalani o Māui

Or the surge in business formation is due to laid off workers who are forming LLCs to limit liability while they drive for Uber and DoorDash because unemployment insurance payouts are so low.

4/4

The semantics matter because conflating "high prices" with "inflation's cause" leads to bad policy ideas (price controls, caps, blaming greedy corporations) instead of addressing root cause monetary or supply issues.

3/4

I’m not trying to be argumentative over semantics, but the average person doesn’t understand this because the pros keep using the wrong words and terminology.

2/4

High prices are an effect of that scenario of too much money, or an effect of a supply shock (like we’re seeing now), or a combination of both. This specific scenario is called cost-push inflation.

1/4

Inflation isn’t caused by high prices (I know, sounds counterintuitive). It’s usually caused by too much money in the system creating too much artificial demand.

This is unintentionally hilarious.

Agreed. They are all flirting with disaster.

The price spike we’re currently seeing in crude oil is deflationary, and a repeat of what we saw in 2008 (see chart). 👇🏼

My posts from three days ago (scroll down) explains why.

End of week cleanse. Happy Aloha Friday everyone.

Haleʻiwa, O‘ahu, Hawaii 🤙🏼

“BlackRock said on Friday it has put limits on withdrawals from a flagship private credit fund after a surge in redemption requests, amid rising investor worries over the once red-hot asset ‌class.” 👇🏼

As I started saying at the end of November, the Season of Truth™️ has arrived. 👇🏼

Nonfarm Payrolls (NFP): -92k (exp. 59k, prev. 130k, rev. 126k)

Unemployment Rate (UE): 4.4% (exp. 4.3%, prev. 4.3%)

They will go down significantly. And sooner than many think.

Capacity is tight because there are far less trucking/transport companies and CDL drivers than there were a year ago due to bankruptcies and immigration crackdowns.

It’s basic supply and demand.

👇🏼

I’m old enough to remember when the U.S. was funding Osama Bin Laden. 🤦🏻‍♂️

I’m old enough to remember when the U.S. was funding Osama Bin Laden. 🤦🏻‍♂️

Yup. It’s all deflationary.

👇🏼

2/2

When prices surge for essentials that people can't easily cut back on (inelastic demand), households face a squeeze on their real purchasing power. A larger share of income goes to these necessities and consumers reduce overall spending to maintain the basics.

Look beyond first order effects.

1/2

Inflationary price spikes in goods or necessities often lead to weaker aggregate demand. Especially when the spikes stem from supply-side shocks.

“Regime change for USD is upon us.”

Like I said 9 days ago, this post was garbage.

It’s long overdue.

This used to be my generation’s (Gen X) attitude about war.

I’m still here. 👇🏼

👇🏼
bsky.app/profile/maui...

Dutta was always right.

Oops! 👇🏼

Dutta was always right.

Oops! 👇🏼

Agreed. But it doesn’t change what I said about the consumer. You can’t have inflation if the average person is unable to spend more.

If your definition of inflation is that the price of one commodity (albeit essential) goes up, then yeah.

From a broader perspective, this is very deflationary. Consumers are already hurting, so they will cut back wherever they can.

If your definition of inflation is that the price of one commodity (albeit essential) goes up, then yeah.

From a broader perspective, this is very deflationary. Consumers are already hurting, so they will cut back wherever they can.

Respectfully, rents are not “also much higher”. 👇🏼