Measured Inflation in July

A CNN headline notes “A key inflation measure rose at fastest pace in 30 years in July”, with that key inflation measure being the year-on-year (y/y) personal consumption expenditure (PCE) inflation. In point of fact, that headline was actually incorrect as annualized m/m inflation was actually slightly higher in June.  But in any case, by focusing on the y/y rate, they missed the main message In today’s release — that month-on-month (m/m) annualized PCE inflation was down sharply, from 6.6% to 5.1%. Moreover, the core counterpart was also down, from 5.8% to 4.1% (0.3% m/m hitting the Bloomberg consensus on the nose.)

This personal income and expenditures release rounds out the inflation measures for July. Updating the graphs from this August 11th post, we have the following.

Figure 1: Month-on-month annualized inflation from CPI-all urban (blue), from personal consumption expenditure (PCE) deflator (black), chained CPI  (brown), sticky price CPI (green), and 16% trimmed mean CPI (red). Chained CPI inflation seasonally adjusted by author. Source: BLS, Atlanta Fed, Cleveland Fed, via FRED, and author’s calculations.

The general discussion stressing y/y changes is understandable, but frustrating as it really tells almost as much about the past as the present, in the current context.

What about core measures? The core CPI inflation rate was also sharply down, as shown in Figure 2 (no trimmed core shown).

Figure 2: Month-on-month annualized inflation from CPI-all urban (blue), from personal consumption expenditure (PCE) deflator (black), chained CPI  (brown), and sticky price CPI (green). Chained CPI inflation seasonally adjusted by author. Source: BLS, Atlanta Fed, Cleveland Fed, via FRED, NBER, and author’s calculations.

Looking to components of the PCE deflator, every inflation category was down relative to June, except for energy goods and services (rising from 1.5% to 1.6% m/m), and nondurable goods and services, both of which remained constant.

In other words, to repeat the conclusion to my August 14th post, every easily measurable aggregate indicator — CPI, PCE deflator — of m/m inflation  is down.

The 5 year inflation breakeven rose by 3 bps. Nonetheless, the breakeven is still lower than after the July CPI release (and one has to remember that the unadjusted breakeven is a distorted measure of expected inflation, due to inflation and liquidity premia, as discussed in this post).

Figure 3: Five year inflation breakeven calculated as five year Treasury yield minus five year TIPS yield (blue), five year breakeven adjusted by inflation risk premium and liquidity premium per DKW, all in %. Source: FRB via FRED, Treasury, KWW following D’amico, Kim and Wei (DKW) accessed 8/6, and author’s calculations.

Update, 5pm Pacific:

Goldman Sachs shows their trimmed core PCE deflator inflation measure, and forecasts.

Source: Hatzius, Struyven, Bhushan, “Global Economics Comment: July Trimmed Core Inflation: Flat at 1.8% YoY in the US; Sequential Acceleration in UK and Canada,” Goldman Sachs, 27 August 2021.

75 thoughts on “Measured Inflation in July

  1. Moses Herzog

    I wonder how much of this is a, how to say, “knowing ignorance”, “Convenient ignorance”, or I guess the standard expression is “feigning ignorance”. Click bait, headlines. Even NYT participates in this old trick from time to time. You’d think with all the useless people at most of these news organizations they could have at least one credentialed economist to avoid this type thing.

    1. macroduck

      End to end, top to bottom, except for maybe one thing. They’ve been putting up the significance (danced) of what they write for so long that some of them no longer know they’re doing it.

  2. Moses Herzog

    I thought this was interesting.
    https://www.theguardian.com/us-news/2021/aug/27/us-marines-stuart-scheller-video
    Especially the part about evacuating military before evacuating American citizens and Afghani allies. But some on this blog apparently think that the method in which an action is conducted doesn’t matter. I guess pointing that out makes me a Democrat partisan, but beings that I am criticizing a President and National Security apparatus of the political party to which I belong, it’s hard for me to digest that logic of me being “partisan”. I guess only a person who grew up in Atlanta during which (????) years and tells us Atlanta schools are not segregated or stratified can explain how a Democrat criticizing other Democrats is “partisan”. It’s a special kind of logic.

    1. pgl

      Wow – this whole tragedy is nothing more than a chance to hurl pointless partisan insults. It is like you think this is one of your sick jokes. Dude – you are one very sick person.

    2. pgl

      BTW – I hear you were hanging out in the Greenwood District of Tulsa a few months ago plotting with a couple of your comrades a way to redo that tragic event a century ago. Do remember to be discreet about this as Stephen Miller will not be there to bail you out.

    3. Barkley Rosser

      Moses,

      Why are you lying again?

      I looked at your link. There was nothing about military being evacuated before civilians unless you think that leaving Bagram Air Force base before leaving the Kabul airport is “evacuating military before civilians.” There is still miltary in Kabul evacuating civilians.

      This guy Scheller thinks Bagram should have been held onto longer, and there are others that agree with that view, although I have also seen people arguing keeping Bagram would not have helped any. But this is most certainly not what you claim it was: military being evacuated before civilians. As it was State Dept. ordered all Americans to leave as of April 27, and some began leaving then, before Bagram was left. But quite a few seem to be making no effort to be evacuated, although the vast majority have been by now.

      Or maybe you were not consciously lying. Maybe you are unable to comprehend what you read.

      1. pgl

        Did you notice how Lindsey Graham got Moses to move his goal posts. The original dereliction of duty allegation was that we would leave our Afghan allies being. Oh wait – the airlift has gotten 100 thousand of them out and counting. Moses – “Lindsey, Lindsey, what do you want me to complain about now?”

        Be careful with your criticism of neocon Moses lest he remind you that you once talked to a racist.

    4. Ivan

      This soldier clearly didn’t get the strategic and political situation. He broke the rule that during battle the only thing we have time for is that soldiers (like him) do as told and shut the F… up.

      For political reasons Trump had reduced the number of troops to 2500 by x-mas in spite of pleas from many generals. He had also signed what can only be described as surrender papers to the Taliban. Finally he had done nothing to get those Afghan friends back to US (less than 500 had arrived by the time he left the White House (3 months before he had agreed we would be completely out). Given what was handed over to Biden, I think it is a miracle that he managed to get Taliban aboard with postponing the troop withdrawal from May 1’st to Sept. 1’st and avoid the collapse of the Afghan government until just a few weeks before that date.

      Sure the Monday morning quarterbacks can find things that might have been handled better. But much of what they suggest (evacuate millions of Afghans) would have had the Afghan government collapse and surrender to Taliban 3-4 months ago. Anybody seriously prefer that scenario? We would have had to send in a few hundred thousand US troops, build up another surrogate government, and then hope that one could protect us as we left.

  3. Moses Herzog

    Well, this’ll be my last comment tonight. Gonna do some leisure reading, eat some Americanized Chinese take-out, maybe watch a movie. Enough reading economics, or reading about military decisions that ruin families’ entire lives because senile old bastards think everything gets back to themselves. But I thought this was a good article, even the cute little classroom rendition. Hopefully maybe adults who are entrusted with the care of other people’s children can act more mature/wise than the children they are teaching. Not likely, but……
    https://www.yahoo.com/news/unvaccinated-teacher-spread-covid-19-211200944.html

  4. Not Trampis

    annualising monthly figures will always give misleading and volatile figures. Learn from us downunder look at the trimmed mean figure.

    1. Ivan

      I think they are just getting smarter. Presumably if people know a product is going to get cheeper at a later point in time, many postpone their purchases.

  5. pgl

    Kevin Drum noticed the same thing – although your coverage is more extensive. The WSJ needs better reporters.

  6. pgl

    Lindsey Graham got Clinton impeached over a blow job so I guess it is time to impeach another Democrat. Why? The Kabul airlift got only 100 thousand Afghan allies out when Graham insists we should have gotten 1 million out.

    https://nypost.com/2021/08/25/lindsey-graham-says-biden-should-be-impeached-over-afghanistan-withdrawal/

    Let’s put aside the fact that this was triggered by Trump’s Doha Agreement, which of course Graham could not be bothered with criticizing. Never mind Graham defended Trump’s serial treason. Put all these idol worship of Donald Trump aside.

    Trump and people like Tucker Carlson insist we should not accept even a single BROWN MUSLIM in the US so where to put 1 million Afghans? Oh yea – have them all move to the Gaza Strip. I’m sure that will work out well.

    1. paddy kivlin

      heh,

      graham is a never trumper, lincoln project type

      also, glad to see biden and his liberal neocons were smart enough not to change anything triump did!

      trump at doha was biblical!

  7. ltr

    https://news.cgtn.com/news/2021-08-28/Chinese-mainland-reports-21-new-confirmed-COVID-19-cases-135tyru7DJS/index.html

    August 28, 2021

    Chinese mainland reports 21 new COVID-19 cases

    The Chinese mainland recorded 21 new confirmed COVID-19 cases on Friday – 1 local transmission in southwest China’s Yunnan Province and 20 from overseas, the latest data from the National Health Commission showed on Saturday.

    In addition, 10 new asymptomatic cases were recorded, while 453 asymptomatic patients remain under medical observation.

    This brings the number of confirmed COVID-19 cases on the Chinese mainland to 94,786, with the death toll unchanged at 4,636.

    Chinese mainland new locally transmitted cases

    https://news.cgtn.com/news/2021-08-28/Chinese-mainland-reports-21-new-confirmed-COVID-19-cases-135tyru7DJS/img/56486b5742874ea4b53cea8828afde92/56486b5742874ea4b53cea8828afde92.jpeg

    Chinese mainland new imported cases

    https://news.cgtn.com/news/2021-08-28/Chinese-mainland-reports-21-new-confirmed-COVID-19-cases-135tyru7DJS/img/f1b5574beaf54051b8e471bd37c3b7e2/f1b5574beaf54051b8e471bd37c3b7e2.jpeg

    Chinese mainland new asymptomatic cases

    https://news.cgtn.com/news/2021-08-28/Chinese-mainland-reports-21-new-confirmed-COVID-19-cases-135tyru7DJS/img/8a356e1f071449edb0c13727cfad7239/8a356e1f071449edb0c13727cfad7239.jpeg

  8. ltr

    http://www.news.cn/english/2021-08/28/c_1310154207.htm

    August 28, 2021

    Over 2.01 bln doses of COVID-19 vaccines administered in China

    BEIJING — Over 2.01 billion doses of COVID-19 vaccines had been administered in China as of Friday, data from the National Health Commission showed Saturday.

    [ Chinese coronavirus vaccine yearly production capacity is more than 5 billion doses. Along with over 2.019 billion doses of Chinese vaccines administered domestically, another 800 million doses have been distributed to 100 countries internationally. A number of countries are now producing Chinese vaccines from delivered raw materials. ]

    1. ltr

      August 28, 2021

      Coronavirus

      United Kingdom

      Cases ( 6,698,486)
      Deaths ( 132,376)

      Deaths per million ( 1,936)

      China

      Cases ( 94,786)
      Deaths ( 4,636)

      Deaths per million ( 3)

  9. ltr

    https://www.nytimes.com/2021/08/28/upshot/some-say-low-interest-rates-cause-inequality-what-if-its-the-reverse.html

    August 28, 2021

    Some Say Low Interest Rates Cause Inequality. What if It’s the Reverse?
    With an increasing share of the world’s wealth in the hands of its top earners, a savings glut is pushing asset prices up and interest rates down.
    By Neil Irwin

    It’s an article of faith among many in the financial world: The Federal Reserve’s low interest rate policies and other steps meant to boost the economy are driving the value of stocks and other assets to the moon, and thus are a major cause of high wealth inequality.

    That idea can be heard in documentaries, newspaper opinion articles and many segments on cable financial news. It may also be backward.

    New evidence suggests high inequality is the cause, not the result, of the low interest rates and high asset prices evident in recent years. That is a provocative implication of new research * presented on Friday at the Federal Reserve Bank of Kansas City’s annual Jackson Hole economic symposium (which was conducted virtually because of the pandemic).

    Seeing how that new notion connects with the boom in markets — and the risks to financial stability whenever it ends — means grappling with just why interest rates are so low, financial asset prices are so high, and what the Fed has to do with it.

    Advanced economies have experienced low interest rates for more than a decade. These can be viewed as less a result of central bankers’ decisions and more as a consequence of powerful global forces pushing them downward — creating a corresponding surge in asset prices.

    * https://www.kansascityfed.org/documents/8337/JH_paper_Sufi_3.pdf

    1. ltr

      https://www.kansascityfed.org/documents/8337/JH_paper_Sufi_3.pdf

      August, 2021

      What explains the decline in r ∗ ? Rising income inequality versus demographic shiftsBy Atif Mian, Ludwig Straub and Amir Sufi 

      Abstract 

      Downward pressure on the natural rate of interest (r ∗ ) is often attributed to an increase in saving. This study uses microeconomic data from the SCF+ to explore the relative importance of demographic shifts versus rising income inequality on the evolution of saving behavior in the United States from 1950 to 2019. The evidence suggests that rising income inequality is the more important factor explaining the decline in r ∗ . Saving rates are significantly higher for high income households within a given birth cohort relative to middle and low income households in the same birth cohort, and there has been a large rise in income shares for high income households since the 1980s. The result has been a large rise in saving by high income earners since the 1980s, which is the exact same time period during which r ∗ has fallen. Differences in saving rates across the working age distribution are smaller, and there has not been a consistent monotonic shift in income toward any given age group. Both findings challenge the view that demographic shifts due to the aging of the baby boom generation explain the decline in r ∗ .

      1. macroduck

        This sounds like Piketty’s notion that inequality leaves the rich with the need to invest excess wealth, which in turn leads to the infrared offers of credit. Rising indebtedness is, according to Picketty, a result of rising wealth inequality. Here we have research into Picketty’s claim. He was probably not the only one to see things this way when he published. Plenty of room for this sort of research.

          1. Moses Herzog

            I’m sure many readers will view this as a kind of gibberish comment by me, but I actually thought your “mistake” of infrared worked, because the credit that is offered is portrayed as some kind of “favor” or “positive opportunity” when in fact it has much darker underlying intentions–taking away or siphoning off people’s income. Or that you might need visual assistance to see the true reality of what the credit is. Your “mistake” here reminds me of William Burroughs’ “cut-up method”. Which can be interesting if you’ve ever tried it.
            https://www.openculture.com/2016/07/how-to-jumpstart-your-creative-process-with-william-s-burroughs-cut-up-technique.html

            Scissors, newspaper, and a flat surface is all you need, and possibly a pen and small notebook for random thoughts.

        1. macroduck

          While we’re on the subject, there’s this lovely bit: https://voxeu.org/article/inequality-and-us-household-debt-modigliani-meets-minsky

          The gist is that the bulk of new household debt since WWII has been incurred by middle-class households whose income grown was slow. These households relied on housing equity to borrow.

          So, let’s loop back to rising wealth — and income — inequality as a driver an increase in the supply of credit. Increased wealth concentration =≥ increased supply of credit =≥ falling borrowing rates =≥ rising home equity =≥ increased borrowing capacity and indebtedness =≥ increased wealth concentration. The link suggested by these two papers and Picketty is wage suppression. Wage suppression concentrates wealth and creates both the incentive and the capacity to borrow and to lend.

          1. Baffling

            Low inflation and interest also give employers an excuse to not raise wages. This contributes to wage suppression. In my view, low inflation is far more of a hindrance to low wage workers than the media conveys. Now inflation that is too high is a problem, but simply high inflation benefits low wages more than it does high wage earners. Probably one reason the wealthy despise high inflation.
            Inflation that is just high enough to raise mortgage rates enough to control housing price increases will probably be beneficial to the average person, as they should also see an uptick in wages due to the inflation itself. This could make housing a bit more affordable again, in time. Housing is not very affordable right now.

    2. pgl

      Neil Irwin joins the chorus of smart people shooting down the serial nonsense from JohnH.

      Now the research paper talks in terms of the real economy rather than focusing on Federal Reserve actions. Yes there are other causes of rising inequality which ends up having effects on the real economy.

      But shhh – don’t wake JohnH as he is never going to understand this paper.

  10. Moses Herzog

    According to Barkley Junior, here is the Taliban “savior” for Afghani citizens (this includes women and children I’m assuming) against ISIS. If you’re into death and dismemberment, this should be highly “entertaining” to watch, because you know that a man who has complete control of his territory is crouched down in a dark cave with some flickering candles. It’s the traditional global image of flexing your muscle.
    https://www.theguardian.com/world/live/2021/aug/28/afghanistan-live-news-uks-ability-to-process-evacuations-extremely-reduced-as-us-on-alert-for-further-attacks?page=with:block-6129c74d8f08b30431f84767#block-6129c74d8f08b30431f84767

  11. Moses Herzog

    Well, some of these quotes seem awfully “strange”. This doesn’t seem to jive with the narrative of pure Joe Biden genius I’ve been hearing from Barkley Junior and pgl. What’s up with up with that???
    https://www.theguardian.com/world/live/2021/aug/28/afghanistan-live-news-uks-ability-to-process-evacuations-extremely-reduced-as-us-on-alert-for-further-attacks?page=with:block-6129c4338f08b30431f84748#block-6129c4338f08b30431f84748

    “US officials, speaking on condition of anonymity, said the conditions for the attack were set months in advance.

    They told Reuters that weeks before the evacuation from Kabul airport began following the Taliban’s takeover of the capital, the military had been seeking approval to get at-risk Afghans out of the country.

    But the slow tempo of processing and inability to secure housing for the evacuees in third countries slowed down the pace of departures, according to the officials, at one point halting all flights from Kabul for six hours.

    That meant troops were on the frontlines at the airport gates in the face of chaos outside.

    ‘This didn’t need to happen,’ a US military official told Reuters. ‘They didn’t need to die.’ ”

    That’s just weird man, delaying (or just not putting into action) the removal of citizens before a military evacuation. Well, all of this must be “false” because National Security experts Barkley Junior and pgl have assured me that “Middle-Class” Joe Biden, is, like, a genius, and stuff. Weird…… It must be some Sergeant in the field’s fault. Yup, that’s it.

    1. pgl

      Gee the total lack of planning for this before Trump left office and the delays built in by Stephen Miller’s racist agenda do not get any blame from you. Mike Pompeo must be paying you well. When it is Pompeo-Haley 2024 I trust you will be their campaign manager!

  12. Moses Herzog

    I going to presume by some weird dreamworld definition of some commenters here, Leon Panetta is “center-right” politically [ insert ironic chuckle here ] but it appears that he thinks ISIS is going to get a stronghold on the situation in Afghanistan sooner rather than later. I’m not sure if Leon Panetta belongs to “The Blob” or not, but honestly I still think Steve McQueen is king of silent brooding cool.
    https://twitter.com/OutFrontCNN/status/1431039931971997700

    1. pgl

      What Panetta tweeted was a far cry from what you claimed he wrote. Look – we get you want to be the King of Pointless Liars but please relax as you won that award a long time ago. Although your new BFF Lindsey Graham may be giving you some competition!

      1. Moses Herzog

        @ pgl
        It wasn’t something he wrote, it was something he said in the interview, which anyone can listen to and watch for themselves. Maybe Menzie would like to “correct” my near verbatim quote of Panetta’s thoughts on ISIS’ near future status in Afghanistan. I welcome that if Menzie thinks I misled on Panetta’s thoughts in any shape or form.

        “pgl”, Your playground level responses are really a hoot. If you’ve still stuck at grade school level retorts at late middle age, I’m just openly wondering what you were like in grade school years. Did you form the ability to speak around the age of 10??

        1. pgl

          The problem is that I DID listen to his entire interview. Panetta was giving good counsel to President Biden but he was certainly not echoing the stupid crap you have been saying. Now did YOU listen? Maybe you should go back and listen again. Of course you will never admit Panetta was not endorsing your serial crap as you are definitely the most dishonest troll ever. BTW next time you listen – please do not been drunk on cheap wine this time.

          1. pgl

            https://www.newsweek.com/biden-says-drone-strike-isis-k-wont-last-taliban-condemn-action-1624020

            We took out two top ISIS-K terrorists with drones – no boots on the ground needed. We will take out more.

            Of course neocon nitwits like Josh Bolton and drunk Uncle Moses cannot imagine we could do this. No Uncle Moses would have tens of thousands of American soldiers at constant risk forever as he is too stupid to get that our presence helps terrorists recruit.

            Of course drunk Uncle Moses like his BFF Lindsey Graham have never seen combat up front.

          2. Barkley Rosser

            A point on Panetta’s interview that Moses seems not to have caught or ignored is that it was given before US took out those ISIS-K “planners.” He seemed to act like one needed to do that with “troops in there,” but that is pretty clearly not the case, and US is taking out al Qaeda people in Yemen without any troops on the ground. Hard to know whether Moses is consciously lying or just badly drunk and unable to comprehend accurately things he reads or listens to.

          3. Barkley Rosser

            A further oddity of this link to Panetta’s interview that Moses somehow thinks is so brilliant. Indeed, Panetta has generally been a competent and intelligent guy. But along with saying we will need troops on the ground to go after ISIS-K and al Qaeda in Afghanistan, he also calls for US troops on the ground to go after various terrorist groups in Somalia, where the US left over two decades ago and where there is not a stable or functional government, and then also says that we need to send troops into Nigeria to go after Boko Haram.

            This last especially strikes me as completely off-the-wall. What has happened to Panetta? Has he joined Biden and me in the camp of the “half senile”? I mean first of all the US has never had troops there. Second, this is a very large nation in population with overt 100 ethnic groups in it that is extremely complicated, and three while there is a stable central government there I have never heard of them expressing the slightest interest or support for US troops to enter there to fight Boko Haram. So the US is just supposed to show up one day without the support of the central government and charge into a highly complicated situation in a heavily populated country that we have never had anything to do with militarily? Really? And Moses thinks this interview has anything at all remotely worthwhile in it? This is just outright insane. Panetta has completely lost it.

        2. pgl

          BTW – you are very accurately spewing the views of one national security expert. John Bolton would highly endorse your comments here. Hey – have you managed to grow a mustache like his!

  13. Baffling

    I have been arguing for a while now on this blog that high inflation will not be a problem. In fact, i am in the camp of letting inflation flourish for a few years if possible. Asset prices like housing have appreciated too much for the average consumer. A couple of years of higher inflation, followed by higher interest rates, will probably help to make housing a bit more affordable. I dont see house values increasing appreciably while mortgages are over 5% for a few years. That is probably the path that will balance things out, rather than a housing bust. Still too many buyers and too few homes. But higher rates will impact monthly payment limits. There will be limits to how much more housing can appreciate.

  14. 2slugbaits

    This is pretty obvious, but the typical consumer doesn’t think in terms of rates of change. The typical consumer thinks in terms of levels, and even though the rate of change is falling, the price level is still rising. The average person on the street never took calculus. Consumers also tend to anchor their baselines to some point where there was a sharp change in direction. In this case that sharp change was during the depths of the pandemic when price levels were actually falling; i.e., actual deflation as opposed to mere disinflation. Almost half the country voted to re-elect Trump, so we probably shouldn’t be too surprised if measures of consumer sentiment don’t match what’s actually happening in the economy.

  15. Moses Herzog

    Today in Covid comedy:
    https://www.yahoo.com/news/texas-anti-mask-freedom-rally-045722778.html

    https://www.yahoo.com/news/police-captain-refused-vaccine-took-152556970.html <<—-and some people think deep south police are dumb?? Wouldn't you inject a drug used to deworm horses into yourself to treat a respiratory virus?? He's one sharp-minded Georgia police Captain.

    But don't sweat it, it's no big deal. While these brainiacs refuse to take the 2–3 vaccines which are keeping people healthy and out of the hospital discuss their "freedom", others like them are jamming up ICU beds, so that people with other treatable illnesses will die for no reason, because the imbeciles who didn’t take the vaccine make it impossible for others to receive common procedures.
    https://www.yahoo.com/news/u-vet-denied-icu-bed-165528672.html

    1. Moses Herzog

      Also keep in mind, when they make out Daniel Wilkinson’s death certificate, it won’t say “Because idiots who refused to take efficacious vaccine for Covid-19”—-which we can in essence say Covid-19 (and immense human stupidity) was the indirect cause of Daniel Wilkinson’s death. The death certificate will simply say something to the effect of “death from gallstone pancreatitis”.

      There will be, and have already been MANY deaths indirectly caused by Covid-19, and lugheads who refuse to take the vaccine, who never in fact had the virus transmitted to their lungs at all. Most likely thousands, if you sat down and did the math—and that’s only regarding America. Internationally what does that number then become?? This, AGAIN is why some mentally handicapped people out there labeling themselves journalists, need to use the excess deaths measure.

  16. macroduck

    One change hat is obvious in the charts is that the variability of inflation has increased sharply. A sudden, brief acceleration or deceleration in price change has become common when it was uncommon before the pandemic. Howls of agony over a higher (or lower) inflation reading are (what’s the polite term?) misguided.

    If one were to build one of those volatility cone thingies around inflation data, one might find that deflation is inside a reasonably constructed cone, right along with excess inflation. Well, maybe not if he cone were constructed around a sticky-price series. In that case, we’d likely see that deflation and excess inflation are both pretty unlikely.

    2slugbaits point about rates of change applies to volatility measures. We can’t expect the uninitiated to think in these terms. It would be nice, though, if people who make strong claims about the data had some idea about the math needed to validate strong claims.

    1. Moses Herzog

      What is the deal with Gita Gopinath saying yesterday that she doesn’t care if Chairman Powell has his PhD in Economics!?!?!?!? This is an outrage!!!! (said the goof with only his Bachelor’s) Damned people.

      1. Barkley Rosser

        Well, Moses, you have informed us on numerous occasions about the high temperature level of Gita Gopinath in your view. So, of course she can say anything she wants to.

        1. pgl

          I guess old Uncle Moses forgot that Volcker did not have a Ph.D. in economics. Cheap wine does that to one.

          1. Moses Herzog

            @ pgl
            Interesting you would say that:
            https://econbrowser.com/archives/2021/08/guest-contribution-inflation-prospects-a-difficult-transition-for-policymakers#comment-258258

            I keep thinking even you have to get bored with yourself eventually, beings the only one entertained by you is a washed up doctorate who got thrown for a loop when he found out SAAR is always part of the computation of headline quarterly GDP. He was insulting regional federal reserve Banks, private forecasters like Goldman Sachs, IHS-Markit and everyone under the sun before he pieced together that well-known fact.

            Now you’re on here, telling us that 13 deaths of U.S. military, which were very unavoidable is a wonderful thing, because it happened under a Democrat president. Then in the same comment or adjoining one, telling other they are partisan. I think now we all know now how you fell in love with Andrew “What 12,000 nursing home deaths??” in April of 2020.
            http://econbrowser.com/archives/2020/04/the-council-to-re-open-the-economy#comment-235838
            pgl said: “Cuomo hosted a conference call with the governors of the Northeast Region which expressed some smart ideas including the need for testing. Cuomo is basically our national leader given we still have a pack of clowns occupying the White House.”

            pgl, I’m sure the families of the 12,000 dead that Andrew Cuomo ignored agree with your very “rational” view.

          2. Moses Herzog

            *very avoidable, excuse. The two village idiots have me doing it now.

            The bottom line here, that the one idiot who loves Andrew Cuomo, and the other idiot who thinks Covid-19 came out of a science lab don’t “get” is that you don’t do a mass citizen evacuation after a military withdrawal. You do the evacuation first, then withdraw the military. For a half-senile president, half-senile Doctorate in Virginia, and a white Georgian trying to convince everyone he’s a “New Yorker”, that may be a tough one to grasp. I promise you for probably about 19 out of 20 military advisers to senile Biden, that was not “a tough one to grasp”.

          3. Menzie Chinn Post author

            Moses Herzog: Seriously, will you stop it with senile, in re: commentators (public figures are open targets by virtue of being public figures). Just because people make errors of fact occasionally, or do not understand a particular convention, does not make them senile.

          4. Moses Herzog

            Yes Menzie, Lip service about some issues when one President is in office, vs our attitude about the same thing when one’s own party is in office, are “well-informed”. Or when a Democrat governor abuses/molests women, denies Covid-19 vs a Republican doing those same two things. I’m touched by all of pgl’s lip-service on these things that concern him and Barkley so deeply:
            https://twitter.com/FullerProject/status/1426922810035867652

            Well, “it doesn’t count” when an increase in women’s suffering happens under a Democrat leader, does it Menzie??

          5. Menzie Chinn Post author

            Moses Herzog: I haven’t weighed in on former Governor Cuomo on this weblog. If I had known then what I know now about his treatment of nursing home fatalities, I would’ve certainly criticized, had I had a post on policies in NY state. I think that is applicable to many people’s comments. If I had weighed in on the matters regarding Governor Cuomo’s behavior with respect the allegations, I would’ve mentioned them (I don’t believe I mentioned the various cases facing Mr. Trump).

          6. Moses Herzog

            Frankly Menzie, this reminds me a little about the excitement on this blog over Neera Tanden while state level legislators and Governors across this nation were stealing minorities’ and elderly people’s right to vote. It’s sometimes fascinating where people choose to pick their battles.

          7. Menzie Chinn Post author

            Moses Herzog: Every day I read the comments on this weblog, and I too share your wonderment at what excites people’s passions. Many times the comments aren’t even distantly related to the blog’s topic.

          8. Moses Herzog

            I’d love to see pgl’s and even your reaction Menzie, over a Republican Governor denying 12,000 deaths of nearly all elderly people, which by the way, some people thought was related to how they were transported in-between New York State health institutions for Covid-19 care. Well, other than the fact we do actually have such a world and the reaction here, DEFENSE OF or “see no evil, hear no evil” (difference being??) I guess “we’ll never know” will we??

          9. pgl

            “Now you’re on here, telling us that 13 deaths of U.S. military, which were very unavoidable is a wonderful thing, because it happened under a Democrat president.”

            As Barkley often notes – Moses has to lie to make a “point”. I never said that and I never would. But I’m not the one making political hay of a tragic situation. That would be Uncle Moses. Truly disgusting but he thinks he can cleverly lie out of his neocon stance.

          10. pgl

            ‘Moses Herzog: I haven’t weighed in on former Governor Cuomo on this weblog.’

            I have. I condemned Cuomo on this sexual harassment issue and Moses knows this. But Moses has to resort to the most disgusting lies to make some sort of warped point.

            As far as my neighbors who died from COVID-19, Moses it makes like I delighted in this suffering. I did challenged this warped lying troll to show where I ever used any governor’s death count over CDC reports. He can’t. But don’t expect to slow down this sick parade of lies. That is who he is.

          11. Barkley Rosser

            Now now now, Menzie. Moses has only said that I and the president are “half senile.” That means that maybe about half the time we are sort of functional.

            Of course regarding the two things Moses provides for evidence of my half senility, one of them, my admittedly shocking ignorance about SAAR, well, I did not know about it back in my 20s or 30s, so I guess I was half senile back than as well. Or maybe I did know back than and have forgotten, which would count for indicating half senility, or at least some proportion of it.

            And then we have his claim that I “thinks Covid-19 came out of a science lab,” well, I fear this is another case of Moses not telling the truth. I never said any such thing. I said it could have. Now over a year ago lots of scientists were running around saying this was not possible, despite some evidence that it was possible, and Moses jumped up and down on me quoting some of these people. But then some months ago some of those same scientists changed their minds and said that indeed maybe it could have, and actually Moses at that time even noticed that and admitted he had overdone it in criticizing me on that. But now he seems to have forgotten that. As it is, we have just had a major US intel report on this matter that confirms that we do not know. This confirms what I said a year ago in the spring that not only did we not know then but that we shall probably never know because too much data has been destroyed by the Chinese. But, of course, this is clearly strong evidence of my half senility.

            But on a more serious note WaPo today had a long front page story about what happened two weeks ago in Kabul. It looks like a black swan event that could not possibly have been forecast, and nobody did, not even the Taliban. The sudden collapse of the Afghan government and resistance to the Taliban, who were sitting outside the gates of Kabul awaiting the outcome of an ongoing negotiation in Doha, came about due to the sudden departure without warning or even information to others in the government beyond a handful of aides of President Ashraf Ghani. Just the day before he was dismissing concerns expressed by US military leaders about planning for how to keep the Taliban out of Kabul and was planning to give a talk on digitizing the economy. Really. So what made him leave suddenly? Apparently certain of his guards falsely told him that there were Taliban in the palace already and searching room to room to find him. There were not even any Taliban inside the city at that time. Why these guards did this remains a complete mystery. But given what happened to President Najibullah when the Taliban took over when he was president, he was gutted and hanged, it is understandable that Ghani suddenly fled the coop. But there was absolutely no way anybody could have foreseen such a bizarre event happening, and nobody did, although about a million columnists have been huffing and puffing about how Biden should have known what was going to happen.

            Given that any major move to get either US citizens or especially Afghan allies out before US troops left would have probably triggered a collapse of the government right then, as the US was warned, it now looks like probably the worst criticism one can make of Biden and his policies is that they did not move sooner to gather information on the location of Americans (of whom apparently about 250 are still there who want out) as well as speeding up the processing of paperwork for the Afghan allies in anticipation of them leaving suddenly. This error on his part certainly confirms the half senility of the president, along with me, and probably that ice cream eating House speaker as well.

            Oh, and as for me being “washed-up,” well at least that means that I am clean, :-).

        2. pgl

          I did see a recent interview with Gita Gopinath on the role of vaccinations and economic recovery around the world. She is very bullish on the US economy and had good things about the Biden infrastructure proposal. A rather smart interview even if she did not dwell on Jay Powell’s academic background. And why should she as the chief economist of the IMF. Maybe old drunk Uncle Moses has nothing better to do – but this is one busy lady.

  17. pgl

    Moses Herzog
    August 29, 2021 at 9:32 am

    Nothing but more of the pointless lies that seem to consume this pathetically warped person’s little mind. Look – I can take the constant lying from this troll as he can’t even follow a simple game like basketball. But so much pointless hate is beginning to dominate an otherwise excellent economist blog.

    Moses needs serious professional help. But the rest of us should just ignore his crazed waste of space.

  18. joseph

    Moses: “you don’t do a mass citizen evacuation after a military withdrawal. You do the evacuation first, then withdraw the military.”

    Apparently you don’t know what you are talking about. The withdrawal occurred under the Trump administration. Biden increased the number of troops to provide security for the evacuations. This is exactly the opposite of your accusation.

    In February 2020, a year before Biden took office, there were 13,000 U.S. troops in Afghanistan. At that time Trump cut a deal with the Taliban to withdraw all U.S. troops. As part of the deal, Trump ordered the Afghan government to release 5,000 Taliban prisoners, including the current leader of the Taliban. By May of 2020, 8 months before Biden took office, Trump had reduced troops in Afghanistan from 13,000 to 8,500. By January 15, 2021, a week before Biden took office, Trump had reduced troops to 2,500. A withdrawal from 13,000 to 2,500 troops occurred before Biden took office.

    Under Trump’s deal with the Taliban, all remaining troops were to be withdrawn by May 1, 2021. Biden realizing that his deadline would be inadequate to safely complete evacuations renegotiated with the Taliban to extend the deadline to September.

    Trump in a publicly released statement criticized Biden’s extension saying, “we can and should get out earlier. Getting out of Afghanistan is a wonderful and positive thing to do. I planned to withdraw on May 1st, and we should keep as close to that schedule as possible.” Fortunately Biden did not follow Trump’s rushed and hasty withdrawal.

    To facilitate the orderly withdrawal, Biden didn’t withdraw early but instead sent 3,000 more troops to provide security. There are more troops in Afghanistan today than there were when Biden took office, the opposite of your accusation.

    The evacuation has gone as well as can be expected from a combat zone. About 120,000 have been safely evacuated, which is much more than the so-called experts thought was possible a couple of weeks ago.

    Biden knew the withdrawal would be dangerous. As I pointed out in a previous thread, there have been continuous suicide bombings in Kabul for the last four years, about one every week or two. Biden stated publicly that it was likely that there would be a suicide attack attempts during the withdrawal but there is no way to prevent them if you are going to allow evacuation of Afghan citizens as well as U.S. citizens in the crowds seeking asylum.

    1. baffling

      this appears to be in contradiction with another commenter indicating the us military withdrew before the evacuation of civilian personnel. since we have had thousands of civilians evacuated in the past week, i am inclined to believe the timeline presented by joseph on this issue.

    2. joseph

      “i am inclined to believe …”

      You state this as if there is some debatable ambiguity about actual facts. There are a lot of ignorant people who haven’t given a damn about Afghanistan for years, yet that doesn’t keep them from opining on something they have absolutely no understanding about.

      Every single item in my post above is documented fact. There were 13,000 troops in Afghanistan before Trump’s withdrawal. Trump’s own Defense Secretary crowed about the fact that there were only 2,500 troops left in Afghanistan a week before Biden took office. Trump did negotiate the release of 5,000 Taliban prisoners. Biden did negotiate more time for withdrawal from May to September. Biden did send 3,000 more troops to Afghanistan to provide security for the withdrawal. Biden did successfully evacuate 120,000 people.

      I don’t know what you think is controversial about these documented facts.

      1. baffling

        “You state this as if there is some debatable ambiguity about actual facts.”
        not at all. just a little sarcasm. not sure where the anger is coming from.

  19. joseph

    And it would not be out of line to speculate why Trump would cut a deal with the Taliban that involved twisting the arm of the Afghan president to release 5,000 Taliban prisoners including the present leader of the Taliban.

    One not unreasonable possibility is that Trump’s deal was that if the Tailiban did not kill any U.S. soldiers in the months leading up to Trump’s re-election which might embarrass him, he would free their prisoners immediately as a show of good faith and then turn over the country to them after the election.

    This would not be out of character for Republicans as they did something similar in the lead up to the 1968 Nixon election and again in the 1980 Reagan election.

    1. pgl

      “This would not be out of character for Republicans as they did something similar in the lead up to the 1968 Nixon election”

      Nixon had his allies in the State Department undermine the LBJ efforts in 1968 to strike a peace deal in Vietnam.
      LBJ considered this betrayal by Nixon to be treason. LBJ was right.

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