2021 - Is inflation finally back in the conversation?

[52-80 19,086]

5 hours ago, washparkhorn said:

Derivatives remain the unknown risk with these hikes. I have little doubt we will end up in another debt crisis. 

 

Leveraged instruments in the financial markets is like hand grenades in a Parkinsons ward

[52-80 19,086]

Maybe you mean more in the sense of the length and opacity of daisy-chaining products like synthetics and swaps, rather than pure leveraging….but same consequence anyway

[Incredulity 11,563]

 

[Wulaw Horn 18,980]

5 minutes ago, Incredulity said:

 

It’s not like that’s the end. It’s got maybe 100 more following next month. And hikes all through the rest of the year. 

[Cheeseweasel 26,437]

12 hours ago, Wulaw Horn said:

It’s not like that’s the end. It’s got maybe 100 more following next month. And hikes all through the rest of the year. 

And that, kids, is why your mortgage will never get paid off.

[Reagan1k 3,016]

Had an interesting conversation yesterday and heard an optimistic theory.....

Supply chain issues and product shortages were a big contributor to this inflation mess and will coincidentally help the Fed stumble into a softer landing than most expect.

New demand is waning, but there is such a backlog of undelivered goods in the economy that while new orders/business slows, the the backlog for existing/previous work will backfill the economy. 

Select names for discretionary products will suffer big inventory gluts, but the majority of businesses haven't yet caught up so this lessening of demand will be the break they need to catch their breath while keeping employment relatively stable.  The consumer resets/adjusts in the meantime and the Fed gets credit for hitting a triple after being born on third base.

Someone's glass is always half full.

[Cheeseweasel 26,437]

17 minutes ago, Reagan1k said:

The consumer resets/adjusts in the meantime and the Fed gets credit for hitting a triple after being born on third base.

Government FTW!

I hope you're right. This really is new ground and I'll bet they are scrambling to try to figure it out.

[Incredulity 11,563]

1 hour ago, Reagan1k said:

Had an interesting conversation yesterday and heard an optimistic theory.....

Supply chain issues and product shortages were a big contributor to this inflation mess and will coincidentally help the Fed stumble into a softer landing than most expect.

New demand is waning, but there is such a backlog of undelivered goods in the economy that while new orders/business slows, the the backlog for existing/previous work will backfill the economy. 

Select names for discretionary products will suffer big inventory gluts, but the majority of businesses haven't yet caught up so this lessening of demand will be the break they need to catch their breath while keeping employment relatively stable.  The consumer resets/adjusts in the meantime and the Fed gets credit for hitting a triple after being born on third base.

Someone's glass is always half full.

Time will tell.

IMPO this is pretty extreme wishcasting.  The inventory glut will be real, Target is the canary in the coal mine.  Who ends up holding that bag/how many are laidoff is the $99 question.

[Cheeseweasel 26,437]

4 minutes ago, Incredulity said:

Who ends up holding that bag/how many are laidoff is the $99 question.

Middle class gets fucked again.

Same as it ever was. Same as it ever was. Same as it ever was.

[tbone_ 14,020]

What middle class

[Wulaw Horn 18,980]

10 hours ago, Cheeseweasel said:

Middle class gets fucked again.

Same as it ever was. Same as it ever was. Same as it ever was.

Poor people get fucked before the middle class. It is known. 

[babysdaddy 2,718]

Time will tell.
IMPO this is pretty extreme wishcasting.  The inventory glut will be real, Target is the canary in the coal mine.  Who ends up holding that bag/how many are laidoff is the $99 question.

Whipsawed into deflation and then massive cutting of rates and stimulus which eventually kicks equities to the moon? Better to own unlevered tangible assets

[Aqua Buddha 14,504]

10 hours ago, Incredulity said:

Time will tell.

IMPO this is pretty extreme wishcasting.  The inventory glut will be real, Target is the canary in the coal mine.  Who ends up holding that bag/how many are laidoff is the $99 question.

TGT's inventory is only up +9% compared to 2019.

Sure, there are companies there are holding too much in certain categories but the chicken little syndrome is strong right now.

[Incredulity 11,563]

2 minutes ago, Aqua Buddha said:

TGT's inventory is only up +9% compared to 2019.

Sure, there are companies there are holding too much in certain categories but the chicken little syndrome is strong right now.

9% additional inventory is enormous.

Now add their pending PO’s.  Every single company has been rage ordering for 18 months at least.  

[Aqua Buddha 14,504]

1 minute ago, Incredulity said:

9% additional inventory is enormous.

Now add their pending PO’s.  Every single company has been rage ordering for 18 months at least.  

Not over three years it's not and their sales are up significantly up over 9% in that time.  I can't speak to their pending orders but in the industry as a whole, inventory isn't that bad compared to '19.  2020 and 2021 were outfitters for obvious reasons.

The problem with WMT and TGT is they have the wrong inventory.  They misread consumer sentiment, which is understandable considering it swings wildly every few months.

[gmr548 16,499]

Poor people get fucked before the middle class. It is known. 

It’s 2022. The middle class are poor people.

[Cheeseweasel 26,437]

10 hours ago, Aqua Buddha said:

TGT's inventory is only up +9% compared to 2019.

They probably paid top dollar to get that inventory. And now they are going to have to sell it at a loss to move it out. FIFO is a bitch when prices are dropping. 

Good times.

[Aqua Buddha 14,504]

1 hour ago, Cheeseweasel said:

They probably paid top dollar to get that inventory. And now they are going to have to sell it at a loss to move it out. FIFO is a bitch when prices are dropping. 

Good times.

From what I understand, most of theirs and WMT's excess inventory are in outdoor living type categories and in the world of retail summer is over by July 4th.

[52-80 19,086]

13 hours ago, Wulaw Horn said:

Poor people get fucked before the middle class. It is known. 

Not if they get more free money

https://www.washingtonpost.com/us-policy/2022/06/17/biden-gas-white-house/

Quote

Senior White House aides have in recent days explored new ideas for responding to high gas prices and looked again at some that they had previously discarded, desperate to show that the administration is trying to address voter frustration about rising costs at the pump.

 

Biden officials are taking a second look at whether the federal government could send rebate cards out to millions of American drivers to help them pay at gas stations — an idea they examined months ago before ruling it out. Aides had found that shortages in the U.S. chip industry would make it hard to produce enough rebate cards, two people familiar with the matter said. White House officials also fear there would be no way to prevent consumers from using them for purchases other than gasoline, according to another person familiar with the discussions.

 

[Immaculate Vibes 114]

Just now, 52-80 said:

Not if they get more free money

https://www.washingtonpost.com/us-policy/2022/06/17/biden-gas-white-house/

 

 

[Cheeseweasel 26,437]

1 hour ago, 52-80 said:

Not if they get more free money

https://www.washingtonpost.com/us-policy/2022/06/17/biden-gas-white-house/

 

[bullzak 411]

How many giveaways can these clowns come up with? Rebate cards, student loan forgiveness on and on?

[Shaggy3.0 1,695]

5 minutes ago, bullzak said:

How many giveaways can these clowns come up with? Rebate cards, student loan forgiveness on and on?

<No CR>

Assume unlimited giveaways, what's the end-game here?  I mean, when value for everything is diluted, at what point do people just say "screw it"?

 

Edited June 17, 2022 by Shaggy3.0

[gsoda3 3,236]

On 6/15/2022 at 3:27 PM, Wulaw Horn said:

Cancelled a trip to padre and replaced it with a trip around Houston. 

what does an itinerary for a trip around houston look like?  san jacinto?  the museums district?  chinatown? andretti racing? 

[Cheeseweasel 26,437]

14 minutes ago, Shaggy3.0 said:

<No CR>

Assume unlimited giveaways, what's the end-game here?  I mean, when value for everything is diluted, at what point do people just say "screw it"?

 

MEGAINFLATION

[Immaculate Vibes 114]

7 minutes ago, Shaggy3.0 said:

<No CR>

Assume unlimited giveaways, what's the end-game here?  I mean, when value for everything is diluted, at what point do people just say "screw it"?

 

Most of us on this thread know it’s all a confidence game. The predicting when it is lost is the hard part. As some people like to say, gradually, then suddenly. That’s my guess. 
 

12 minutes ago, gsoda3 said:

what does an itinerary for a trip around houston look like?  san jacinto?  the museums district?  chinatown? andretti racing? 

 

 

[Wulaw Horn 18,980]

45 minutes ago, gsoda3 said:

what does an itinerary for a trip around houston look like?  san jacinto?  the museums district?  chinatown? andretti racing? 

I'm going in the RV- it's just I'm not going far.  Bolivar peninsula.  Sargent on the beach.  Yogi Bear park in Waller.  My kids are 7, 9 and 11 so this all suits them fine.  We will stay for 2 days at each of the beach areas and 4 days at Yogi Bear Park (they have cool swimming pools, a lazy river, a fishing pond, arts and crafts, mini golf, laser tag, stuff like that. 

[ChickenSandwich 9,798]

2 hours ago, 52-80 said:

Not if they get more free money

https://www.washingtonpost.com/us-policy/2022/06/17/biden-gas-white-house/

 

Ridiculous. 

[Immaculate Vibes 114]

1 minute ago, ChickenSandwich said:

Ridiculous. 

The epitome of “Just do something!”

[UT_OB1 2,200]

38 minutes ago, Wulaw Horn said:

I'm going in the RV- it's just I'm not going far.  Bolivar peninsula.  Sargent on the beach.  Yogi Bear park in Waller.  My kids are 7, 9 and 11 so this all suits them fine.  We will stay for 2 days at each of the beach areas and 4 days at Yogi Bear Park (they have cool swimming pools, a lazy river, a fishing pond, arts and crafts, mini golf, laser tag, stuff like that. 

Brazos bend state park is fun. They’ve got an observatory too that brings all the nerds out with their telescopes and they set up so everyone can look through them.  My kids are about the same age and we all enjoy going. 

[jimmyjazz 45,554]

On 6/15/2022 at 10:32 AM, Cheeseweasel said:

The whiplash of going from "shortages" to "excess inventory" is going to be a huge shit sandwich. 

Wasn't that the gist of Target's Q call?  Oh shit, we have way too much stuff on the shelves!

EDIT:  oops, didn't read to the end of the thread, I see TGT has been discussed.  Delete user, ban post, or something.

Edited June 17, 2022 by jimmyjazz

[Cheeseweasel 26,437]

16 minutes ago, Immaculate Vibes said:

The epitome of “Just do something!”

Throwing money at an inflationary problem. 

 

[jimmyjazz 45,554]

On 6/15/2022 at 5:40 PM, 52-80 said:

Leveraged instruments in the financial markets is like hand grenades in a Parkinsons ward

Mother-in-law will probably pass this weekend from Parkinson's, so this hits close to home.

[Dahobbs 17,444]

15 hours ago, Aqua Buddha said:

TGT's inventory is only up +9% compared to 2019.

Sure, there are companies there are holding too much in certain categories but the chicken little syndrome is strong right now.

What, you're telling me the guy invested into the end of the US has a functional unified government might be overly pessimistic? Shocking. 

[washparkhorn 9,935]

The belief in the Fed Put continues to buoy markets. In other words, there is a lot of money riding on the Fed coming to the rescue if the financial markets squeal loud enough. 

 

 

[Immaculate Vibes 114]

9 minutes ago, washparkhorn said:

The belief in the Fed Put continues to buoy markets. In other words, there is a lot of money riding on the Fed coming to the rescue if the financial markets squeal loud enough. 

 

 

Do you think they cave? If so, when?

[StruggleBus 3,922]

17 hours ago, Wulaw Horn said:

Poor people get fucked before the middle class. It is known. 

Yeah but poor people are gross

[Incredulity 11,563]

11 minutes ago, Immaculate Vibes said:

Do you think they cave? If so, when?

6% Unemployment.

[52-80 19,086]

These are the guys causing inflation and economic crises due to their evil price gouging. 
 

And also the transportation guys too. 

[bschoolprof 6,232]

 

What’s great is not that they came to their senses and abandoned this idea because it was so foolish. Instead, they gave up because they couldn’t figure out how to pull off such a terrible idea. The grown ups are most definitely not in charge.

[52-80 19,086]

8 hours ago, bschoolprof said:

What’s great is not that they came to their senses and abandoned this idea because it was so foolish. Instead, they gave up because they couldn’t figure out how to pull off such a terrible idea. The grown ups are most definitely not in charge.

 

[statsman 5,423]

Honest, no-CR question: when Volcker started raising rates to stop inflation (which worked, although it also brought along a recession that tanked Carter and nearly ranked Reagan), how much was he coordinated with the WH? Was Carter agreeing to Volcker’s moves, or was Volcker independent of administration wishes?

[washparkhorn 9,935]

1 hour ago, statsman said:

Honest, no-CR question: when Volcker started raising rates to stop inflation (which worked, although it also brought along a recession that tanked Carter and nearly ranked Reagan), how much was he coordinated with the WH? Was Carter agreeing to Volcker’s moves, or was Volcker independent of administration wishes?

Carter nominated Volcker as the Fed Chair and kept his word to Volcker that his Administration would let the Fed remain independent.  See https://books.google.com/books?id=ZdIwDwAAQBAJ&dq=Carter+the+white+House+years&source=gbs_navlinks_s

 

Edited June 18, 2022 by washparkhorn

[Upgrayedd 5,805]

16 hours ago, 52-80 said:

These are the guys causing inflation and economic crises due to their evil price gouging. 
 

And also the transportation guys too. 

Now do just Petroleum

[statsman 5,423]

5 minutes ago, washparkhorn said:

Carter nominated Volcker as the Fed Chair and kept his word to Volcker that his Administration would let the Fed remain independent.  See https://books.google.com/books?id=ZdIwDwAAQBAJ&dq=Carter+the+white+House+years&source=gbs_navlinks_s

 

Credit to Carter. (CR aside:  I, personally, am a conservative and was fed a lot of negativity about Carter. Over the years, I came to realize that a lot of the bad things in his term were bad luck and bad timing). 
Allowing Volcker independence helped the nation, but did no favors to his political prospects. Kudos. 

[Guest]

On 6/16/2022 at 8:12 AM, Cheeseweasel said:

Government FTW!

I hope you're right. This really is new ground and I'll bet they are scrambling to try to figure it out.

I don't believe that at all.  Everything they do is an attempt to further fuck things up, only to follow it up with a goofy look, a shrug, and mumbling about "we're really trying."

No they aren't.  The evidence is overwhelming to the contrary.  So are the results.

[Blotto 23,432]

On 6/17/2022 at 4:52 PM, 52-80 said:

These are the guys causing inflation and economic crises due to their evil price gouging. 
 

And also the transportation guys too. 

Whats the source of that data, do you know? I was trying to find something similar a while ago, and if this source allows you to drill deeper into the data, it would be useful. 

[52-80 19,086]

44 minutes ago, Blotto said:

Whats the source of that data, do you know? I was trying to find something similar a while ago, and if this source allows you to drill deeper into the data, it would be useful. 

https://www.bea.gov/data/income-saving/corporate-profits

https://apps.bea.gov/iTable/iTable.cfm?reqid=19&step=3&isuri=1&1921=survey&1903=239#reqid=19&step=3&isuri=1&1921=survey&1903=239

 

[Guest]

On 6/16/2022 at 8:24 PM, Aqua Buddha said:

Not over three years it's not and their sales are up significantly up over 9% in that time.  I can't speak to their pending orders but in the industry as a whole, inventory isn't that bad compared to '19.  2020 and 2021 were outfitters for obvious reasons.

The problem with WMT and TGT is they have the wrong inventory.  They misread consumer sentiment, which is understandable considering it swings wildly every few months.

This is neither fully correct nor incorrect.  Retailers have gluts on certain items that WERE able to be produced or shipped  in order to attempt and have something on the shelf in place of items not able to be produced or shipped.  With as lean as inventories are run on virtually immediate consumer demand/ pulls; there is very little 'misread' by retailers like TGT and WMT.  

At the beginning of Covid, they weren't out of toilet paper because they misread consumers.  It was the result of extraordinary factors that have rarely been seen before, outside of hurricane/ disaster situations.  The system is STILL trying to recover overall, not limited to TP supply..  

[phdhorn 6,224]

Okay, I thought this was funny.  A little inflation levity...