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Sun Jun 9, 2019, 12:08 PM

If we consumers are paying the tariffs, shouldn't inflation be through the roof?

I mean, I know we are ... there's no mechanism to make Gyna and Canader pay the tariffs, and corporations aren't just going to entirely eat the losses, so ...

Yet, AFAIK, there's been no increase in inflation as a result of the tariffs. What's up with that? Are the government bean-counters fudging the numbers? Secretly applying an 'offset' value, under some sketchy auspices?

Or ... is inflation actually way up, but the media won't report it?

I just don't see how it's possible that inflation has not risen given the tariffs that have been put in place?

31 replies, 1283 views

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Reply If we consumers are paying the tariffs, shouldn't inflation be through the roof? (Original post)
mr_lebowski Jun 2019 OP
hlthe2b Jun 2019 #1
mr_lebowski Jun 2019 #3
Salviati Jun 2019 #9
Igel Jun 2019 #14
Salviati Jun 2019 #15
NutmegYankee Jun 2019 #30
tblue37 Jun 2019 #26
gopiscrap Jun 2019 #2
SWBTATTReg Jun 2019 #4
mr_lebowski Jun 2019 #8
SWBTATTReg Jun 2019 #10
The Velveteen Ocelot Jun 2019 #5
smirkymonkey Jun 2019 #25
roamer65 Jun 2019 #6
Wellstone ruled Jun 2019 #7
onecaliberal Jun 2019 #11
mr_lebowski Jun 2019 #12
onecaliberal Jun 2019 #20
AJT Jun 2019 #27
MarvinGardens Jun 2019 #13
Jim__ Jun 2019 #16
mr_lebowski Jun 2019 #17
Mosby Jun 2019 #18
dumbcat Jun 2019 #23
Farmer-Rick Jun 2019 #28
Voltaire2 Jun 2019 #19
Kid Berwyn Jun 2019 #21
mr_lebowski Jun 2019 #22
Laura PourMeADrink Jun 2019 #24
Skittles Jun 2019 #29
NCjack Jun 2019 #31

Response to mr_lebowski (Original post)

Sun Jun 9, 2019, 12:12 PM

1. Walked into a grocery store lately? Food prices are definitely up

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Response to hlthe2b (Reply #1)

Sun Jun 9, 2019, 12:17 PM

3. HELL YEAH I have, I grocery shop all the time, and prices are WAY THE HELL UP ...

That is actually EXACTLY what prompted this post

How the hell are inflation numbers not going through the roof?

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Response to mr_lebowski (Reply #3)

Sun Jun 9, 2019, 12:54 PM

9. Because the inflation numbers are designed in a way to not include the costs that affect most people

https://www.investopedia.com/terms/c/coreinflation.asp

What is Core Inflation
Core inflation is the change in costs of goods and services, but does not include those from the food and energy sectors. This measure of inflation excludes these items because their prices are much more volatile. It is most often calculated using the consumer price index (CPI).

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Response to Salviati (Reply #9)

Sun Jun 9, 2019, 01:42 PM

14. And we get most of our food and energy from China?

There are other explanations.

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Response to Igel (Reply #14)

Sun Jun 9, 2019, 01:44 PM

15. This is an explanation to the post that I responded to.

Why are inflation numbers not going up when it's clear that food prices are going way up.

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Response to Salviati (Reply #15)


Response to hlthe2b (Reply #1)

Sun Jun 9, 2019, 05:35 PM

26. +a brazillion! nt

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Response to mr_lebowski (Original post)

Sun Jun 9, 2019, 12:13 PM

2. interesting point

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Response to mr_lebowski (Original post)

Sun Jun 9, 2019, 12:21 PM

4. I suspect that when they changed the measurements used to measure inflation, they ...

actually deflated the impact of inflation ... this was done years and years ago, and I recall people griping at the time about it. I imagine if there were a 'bigger' measurement of inflation available, we'd be seeing more inflation.

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Response to SWBTATTReg (Reply #4)

Sun Jun 9, 2019, 12:30 PM

8. That's my suspicion as well ... somehow the impact of the inflation these tariffs are causing

are being hidden from the public at large ... even though all of us are seeing the increased prices on goods, somehow the 'official indicators' are saying it's not happening.

Something is clearly amiss.

I think this is an opportunity for Democrats ... every time IQ45 crows on the economy, multiple Congressional Dems should reply 'If the economy is so great, why are prices rising on EVERYTHING we buy? When was the last RAISE you got?', etc.

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Response to mr_lebowski (Reply #8)

Sun Jun 9, 2019, 12:56 PM

10. Many different indicators out there too...just that someone has got to tie it all together and ...

make common sense for the average Jack and Jill on the streets. Statistics are out there already that the 2017 tax cut and jobs bill failed miserably. A good number of people can't even come up with $400 in savings if they need it. The average price of a new car (loan) is now over $32K. Job demand crawled to a miserably 75K the latest reading of this index. Any gains in job pay have been swallowed up by these tariffs, so Americans really haven't seen any major increases in pay. Do you know who has? The 1%ers and their ilk have seen major gains in net income, and the federal debt has exploded in size.

I am sure I can come up w/ more, but you are right, a well put together white paper by an economist would be able to do this and most if not all of our 2020 presidential candidates are pretty well up to the task of hammering this tidbits of information in.

Hammer rump on the cost of everyday living (us vs. the 1%ers (Sanders and Warren I think have been hammering away using this as issues, and perhaps the others too)). I don't think it's going to take too much because like you and I, all of us are suffering these little cuts and nicks against our income.

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Response to mr_lebowski (Original post)

Sun Jun 9, 2019, 12:21 PM

5. It takes awhile for those things to start having an impact.

It doesn't happen overnight. Grocery prices are up, but the effects of that will be felt over time and not immediately. The extent to which people will change their purchasing habits depends on a lot of things. Maybe they don't buy as many tomatoes or avocadoes but they buy more of something else. Maybe farmers will grow less of one thing and more of another thing. It will take months before the larger economy is affected.

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Response to The Velveteen Ocelot (Reply #5)

Sun Jun 9, 2019, 05:30 PM

25. I have definitely noticed the increase in the price of avocados.

Sky high! I have had to eliminate them. They are just too expensive. I love them in my salads and in guacamole, but I can't afford them until the prices go down, if they ever do.

I just moved into a new apartment and it's $250 more than my old apartment so I am having to tighten the belt even more. I am noticing all these little price increases everywhere. I am going to ask for a raise, but don't know if I will get one.

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Response to mr_lebowski (Original post)

Sun Jun 9, 2019, 12:21 PM

6. Some will get absorbed in lower profit margins.

Also through cost cutting, discontinuance of low profit product lines and staff reductions.
My company was affected by the first round of Chinese tariffs and that is how they reacted.

We also increased prices. You will definitely see inflation pick up pace.

The two winners in this trade war will be Vietnam and South Korea. We have a FTA with the ROK.

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Response to mr_lebowski (Original post)

Sun Jun 9, 2019, 12:25 PM

7. Point,in the Mid Seventies,

we had a mega inflation go around with Nixon and his wage price freeze bullcrap. It was a gradual increase do to disparities by Regions and the number of Union Jobs that were affected. Being in the Food Grocery Wholesale and Sales Business at that time. Yes,prices were escalated on a daily basis,my price book was literally up dated over night some weeks. And we dealt with this for three years.

How many remember what they paid interest wise at that time. Pure ugly brutal and that was one of the drivers as well as the freeze on Wages. The so called price controls only suck with certain US manufactured goods. Food stuffs not so much.

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Response to mr_lebowski (Original post)

Sun Jun 9, 2019, 01:04 PM

11. The price of everything is rising rapidly. Do you buy food, clothing or gas?

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Response to onecaliberal (Reply #11)

Sun Jun 9, 2019, 01:08 PM

12. Of course, hence the post ...

I don't understand how 'official' inflation numbers are not rising dramatically based on what I see when I'm buying stuff

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Response to mr_lebowski (Reply #12)

Sun Jun 9, 2019, 03:20 PM

20. No one is actually trying to give us accurate information from this criminal squatter administration

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Response to mr_lebowski (Reply #12)

Sun Jun 9, 2019, 05:41 PM

27. Official inflation numbers don't unclude gas or food.

They haven't for quite some time.

Why Food and Energy Aren't Included in Core Inflation. Food and energy prices are exempt from this calculation because their prices are too volatile. Because food and energy are necessary staples, demand doesn't change much even though prices may rise.

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Response to mr_lebowski (Original post)

Sun Jun 9, 2019, 01:14 PM

13. It is trending up recently, just not way up yet.

It bottomed in Jan-Feb. From Feb to April, it rose from 1.52 to 2.00%. I guess this could be noise for now, or the beginning of a trend. May numbers will be posted Wednesday. I don't like to speculate that the career BLS folks are fudging the numbers without evidence that they are doing so.

Republicans accused them of fudging the numbers all through the Obama administration, except when they could find a number that made Obama look bad, then all the sudden the numbers became accurate.

If inflation starts heating up, I guess this would put the Fed in a tight spot, since the economy is also softening. They will want to cut the interest rate due to the softening economy, but inflation will tie their hands. Then Trump will scream at them for not cutting. Then we can briefly laugh at the absurd situation, before we have to bend over at the grocery store.

Edits: spelling

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Response to mr_lebowski (Original post)

Sun Jun 9, 2019, 01:53 PM

16. Under Greenspan/Boskin we changed the way we compute inflation.

If the price of the standard "basket of goods" goes up, we replace expensive items in the basket with cheaper items. Stabilizes the hell out of the rate of inflation.

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Response to Jim__ (Reply #16)

Sun Jun 9, 2019, 02:01 PM

17. Ah, I suppose that 'helps' ... watch, by 2020 the basket will consist of Prison Nutraloaf (nt)

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Response to mr_lebowski (Original post)

Sun Jun 9, 2019, 02:21 PM

18. taxes (or tariffs) are not necessarily passed on to the consumer

For some reason a lot of "experts" seem to be avoiding the topic.

https://www.intelligenteconomist.com/price-elasticity-of-demand/


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Response to Mosby (Reply #18)

Sun Jun 9, 2019, 05:13 PM

23. Nobody wants to hear that here

If you bring up real economic principles, like elasticity or propensity, you will either be scorned or ignored.

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Response to Mosby (Reply #18)

Sun Jun 9, 2019, 05:47 PM

28. In the article you posted, it says it does NOT apply to necessities

Food is a necessity.

Just as an anicdote, I've been getting prices for a steal roof during the last 9 months. Due to emergencies, I've had to get 3 price quotes over 9 months. It started at $7,000 and has gone up to $10,000. Thanks Trump.

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Response to mr_lebowski (Original post)

Sun Jun 9, 2019, 02:22 PM

19. Two numbers.

1. 19 trillion - us gdp.
2. 64 billion - estimated total economic cost of increased tariffs on us economy.

The current trade war is not big enough to push inflation.

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Response to mr_lebowski (Original post)

Sun Jun 9, 2019, 05:04 PM

21. You want the dirty socialists to rip off the US Taxpayers?

If Feds admit to inflation, all the C.O.L.A. stuff kicks in and who knows how much cat food a Social Security check will fetch?

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Response to Kid Berwyn (Reply #21)

Sun Jun 9, 2019, 05:07 PM

22. True, good point there ... (nt)

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Response to mr_lebowski (Original post)

Sun Jun 9, 2019, 05:26 PM

24. Related...have heard people say on CNBC that trump wants an interest rate drop to

Make wall st investors happy.

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Response to mr_lebowski (Original post)

Sun Jun 9, 2019, 05:47 PM

29. you know how food and drink packaging is getting smaller

that's another way they try to hide inflation

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Response to mr_lebowski (Original post)

Sun Jun 9, 2019, 05:58 PM

31. I smell another tax to take care of this increase in prices due to Trump Tariffs. Of course,

it will be trickle down.

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