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Old 09-17-2015, 04:19 PM   #41
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Would respectfully disagree about the "inflation without wage growth". Inflation is not related just to wages. What if oil went to $150 or $200 or $300 (not likely, I know)? Think back to 1973-1974, an external shock, the oil embargo.

Well, my definition of inflation may not be standard, but the way I see it, if there isn't any wage growth then that is just an example of the standard of living going down and not inflation.

It depends on what you want to throw into the bucket to watch. I think the only thing that is really important are wages because the other stuff could all go away with technology improvements. Example: Food prices used to be very important but now with technology we can produce more food than we can use.
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Old 09-18-2015, 01:44 PM   #42
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Good call on the no raise crowd, seems like the market doesnt like it for now, theres always next week,,,,


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Old 09-18-2015, 03:34 PM   #43
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Thur Fed meeting

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Originally Posted by ESRwannabe View Post
Well, my definition of inflation may not be standard, but the way I see it, if there isn't any wage growth then that is just an example of the standard of living going down and not inflation.



It depends on what you want to throw into the bucket to watch. I think the only thing that is really important are wages because the other stuff could all go away with technology improvements. Example: Food prices used to be very important but now with technology we can produce more food than we can use.

It was all anecdotal, but the above is why I went all into preferred stocks. Heck even Cramer was screaming yesterday about technology is killing off wage growth. And oil does not appear to be an inflation contributor on the horizon anyways. Right or wrong anytime I can get safe yield 400-500 BP above 10 year and inflation rate also, I can sleep with that. I will never corner the market wealth with this strategy, but 4 times a year, I surelove those dividend dumps.


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Old 09-18-2015, 03:53 PM   #44
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Originally Posted by DEC-1982 View Post
Would respectfully disagree about the "inflation without wage growth". Inflation is not related just to wages. What if oil went to $150 or $200 or $300 (not likely, I know)? Think back to 1973-1974, an external shock, the oil embargo.
You may get some prices raised, but demand would fall. Overall, the economy would not grow. If there is a finite amount of money to spend, that's all that can be spent. Money spent on oil related products would reduce other spending. That is not inflation.

Too much money, chasing too few goods is the definition of inflation. We have a surplus of capacity, both in terms of labor and manufacturing.

Inflation is a long way off. Of course, the government could spend more, and that might create it.

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Heck even Cramer was screaming yesterday about technology is killing off wage growth.
We also have a HUGE surplus of labor, for various reasons. And thousands more workers coming on-line in the US everyday. If the price of the dollar gets higher, goods overseas get cheaper. Outsourcing gets easier.

Wages are headed down for the foreseeable future. Of course, if we mandate a $15 an hour minimum wage, that might spur inflation.
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Old 09-18-2015, 04:58 PM   #45
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You may get some prices raised, but demand would fall. Overall, the economy would not grow. If there is a finite amount of money to spend, that's all that can be spent. Money spent on oil related products would reduce other spending. That is not inflation.

Too much money, chasing too few goods is the definition of inflation. We have a surplus of capacity, both in terms of labor and manufacturing.

Inflation is a long way off. Of course, the government could spend more, and that might create it.



We also have a HUGE surplus of labor, for various reasons. And thousands more workers coming on-line in the US everyday. If the price of the dollar gets higher, goods overseas get cheaper. Outsourcing gets easier.

Wages are headed down for the foreseeable future. Of course, if we mandate a $15 an hour minimum wage, that might spur inflation.

Especially ones not suited for todays skill base, I imagine. I heard on the radio the other day that males today of workforce age are at the lowest level of employment since record keeping originated in the 1940s. Working women are on the downslide too after peaking about 10-15 years ago. I cant imagine they are all ER's.


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Old 09-18-2015, 06:28 PM   #46
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We would have been a lot better off if Fed Chairman had a case of laryngitis yesterday. Statement was fine; then she started babbling about having no idea what was happening, no idea what was going to happen, so best to do nothing.

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Old 09-19-2015, 08:03 AM   #47
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We would have been a lot better off if Fed Chairman had a case of laryngitis yesterday. Statement was fine; then she started babbling about having no idea what was happening, no idea what was going to happen, so best to do nothing.

Marc
Conclusion: Yellen was being honest ?
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Old 09-19-2015, 11:03 AM   #48
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then she started babbling about having no idea what was happening, no idea what was going to happen, so best to do nothing.
Aka gut feeling or winging it? It's honest enough. As an ex-engineer that is sometimes the solution after checking and calculating for days.
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Old 09-19-2015, 11:32 AM   #49
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I think it's pretty clear that what stayed the Fed's hand was the poor international economic situation, even though the U.S. is continuing (very gradually) to improve. Our economy is not in a vacuum and our inflation is WAY below the 2% target. CPI over the past 12 months was only 0.2%, one tenth of the target.
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