Market Watch

[Hay Dude]

This inflation conversation is exactly like the frustrating discussions going on in C*ngress right now about men portraying themselves as women so they can beat up on a bunch of women in sports.

You know they are wrong, but they just keep denying it.

Look, we had massive, empiracly proven inflation over the last 2 years, now built–into almost all prices going forward. Meaning we ain’t going back.

Americans are losing trillions in wealth beacause of higher interest rates and staggering inflation. That money is ALL GONE. POOF!

This trashed economy, even on the verge of collapse along with record inflation rates and it’s defenders keep saying “yeah, well sonny well I remember back in ‘79 it was worse”

 

[Torvy]

This is definitely sub-regional, because we’re seeing prices reported all over the place. I know that in my area $2.49 is about what we were paying pre-covid and certainly don’t remember any prices below $2 for the last ten years except for when there was oversupply during the COVID shutdown.

These are the averages for Texas. Not expecting you to remember the same prices in NM. Since they are average, it also means some people were paying even less.

Focus on the key information. The prices prior to 2020 were lower than they have been since March of 2021. 2020 was an anomaly because of very low demand. The exact number will vary by location, but those are the facts.

 

[jyoutz]

These are the averages for Texas. Not expecting you to remember the same prices in NM. Since they are average, it also means some people were paying even less.

Focus on the key information. The prices prior to 2020 were lower than they have been since March of 2021. 2020 was an anomaly because of very low demand. The exact number will vary by location, but those are the facts.

True for many places. The current prices I’m paying are on par with 2019 for my location. They have been higher for the past 2 years, but are now about the same. We have been seeing price drops weekly for the past 2 months. And that’s surprising considering that world market prices are still high.

 

[Torvy]

True for many places. The current prices I’m paying are on par with 2019 for my location. They have been higher for the past 2 years, but are now about the same. We have been seeing price drops weekly for the past 2 months. And that’s surprising considering that world market prices are still high.

Ok, here's the same chart for NM with lines for Alb and SF overlayed as well. The current prices are just about at the peak for 2019. Still higher, but close.

 

[jyoutz]

Ok, here's the same chart for NM with lines for Alb and SF overlayed as well. The current prices are just about at the peak for 2019. Still higher, but close.

View attachment 835837

Thank you. That is what I remembered. We are currently back to the 2019 prices (after higher prices in 21-mid 23).

 

[Torvy]

I don't think you are seeing what I am seeing. We are almost back to the peak of 2019 not the average or the low

" And that’s surprising considering that world market prices are still high."

Not sure what you mean here... in the last week prices have dropped about $10/bbl.

 

[two_bit_score]

 

[jyoutz]

It's costing us all more under the Bidenconomy.

Prices for most products will never be the same as in 2019, no matter who or what party is in leadership. Wages are now much higher and wages never decline. Current prices are a new normal. Maybe commodities that are priced on the world market will decline some, but wages are baked into most consumer products, even those products manufactured in other countries. US middlemen and other labor costs are part of retail prices.

 

[Torvy]

Wages have very little to do with gas price fluctuations. It is almost entirely oil price. Most of the other factors are essentially fixed costs. Economically speaking, Gas is inelastic, meaning there are few alternatives, so demand doesn't change much other than seasonally. Supply (oil prices and refining capacity) is far and away the biggest factor.

As for other goods...it is true, though that wage inflation is relatively permanent. That just means the coming recession will result in more layoffs. The wages are both a symptom and an accelerator of inflation. This really only matters if wage increases are artificial. For instance, if you get 10% more pay for a corresponding 10% increase in productivity, it is not inflationary. If, on the other hand, you get a 10% raise and produce the same output, it is 100% inflationary. This type happens most when min wages are boosted above equilibrium. Also happens when union wages go up due to contracts. Both of those types of increase happen irrespective of productivity and are inherently inflationary. Ultimately, money supply will ways be the primary driver of inflation.

 

[jyoutz]

Wages have very little to do with gas price fluctuations. It is almost entirely oil price. Most of the other factors are essentially fixed costs. Economically speaking, Gas is inelastic, meaning there are few alternatives, so demand doesn't change much other than seasonally. Supply (oil prices and refining capacity) is far and away the biggest factor.

As for other goods...it is true, though that wage inflation is relatively permanent. That just means the coming recession will result in more layoffs. The wages are both a symptom and an accelerator of inflation. This really only matters if wage increases are artificial. For instance, if you get 10% more pay for a corresponding 10% increase in productivity, it is not inflationary. If, on the other hand, you get a 10% raise and produce the same output, it is 100% inflationary. This type happens most when min wages are boosted above equilibrium. Also happens when union wages go up due to contracts. Both of those types of increase happen irrespective of productivity and are inherently inflationary. Ultimately, money supply will ways be the primary driver of inflation.

I said that traded commodities (petroleum and more) are not included in my statement that prices are at a new normal, and this applies primarily to consumer products. Yes wage increases can be inflationary and this has been one of the causes for the recent price increases. But higher wages and prices are now established, and since wages aren’t going to decrease, neither will most prices. A recession has always been around the corner periodically and no doubt we will experience another one. But with most sectors of the economy still recruiting employees, this doesn’t indicate an imminent recession.