It is truly a miserable time for many Americans as demonstrated by the Misery Index (inflation rate + unemployment rate). But rather than using the CPI YoY measure at 7.5%, I am using the FLEXIBLE CPI YoY to compute the misery index. And is it ever miserable!
In January, the CORE flexible CPI YoY + U-3 unemployment rate hit a modern high at 22.99%. Or at least since 1967.
Like the movie “50 Shades of Gray,” we have 50 shades of inflation. Examples?
How about hardwood? Producer Price Index for hardwood is up 30.8% YoY.
How about diesel fuel prices? They are UP 40% since January 1, 2021.
How about housing? UP 20% YoY according to Zillow’s home value index.
Global food prices? UP 20% YoY.
I could go on and on, but you get the picture. Rising energy, food and construction materials are soaring making many Americans miserable.
But Powell and The Fed have promised to whip inflation. Whip it good … with interest rate increases.