Latest Inflation Numbers and Discussion

[audreyh1]

Federal Reserve meeting tomorrow and Wednesday. I guess there will be some announcement 2pm on Wednesday and maybe a press conference.

 

[GenXguy]

Many people are going to get stung with the change in commodity charges in their gas bill in Southern California.

November 2022:

Gas Commodity 19 Therms x $.65029 $12.36

December 2022:

Gas Commodity 73 Therms x $1.02638 $74.93

January 2023:

Gas Commodity 58 Therms x $3.20110 $185.66

It was quite a month to month jump from $1.02368 to $3.20110.

Wait, that can't be. I keep reading here that inflation is over.

 

[ShokWaveRider]

Federal Reserve meeting tomorrow and Wednesday. I guess there will be some announcement 2pm on Wednesday and maybe a press conference.

Wednesday 2pm announcement and then after that there is usually a conference with Q&A.

 

[milford]

Its crazy how egg price has basically tripled in price in a couple years, citing avian flu spread as being the main "culprit", however I doubt supply has been reduced by a 1/3 and/or there is all of a sudden spike in demand.

This is a prime example of how distorted the economy currently is and inflation may have subsided in some areas, but its basically baked into economy where companies continue taking turns raising prices knowing that they can get away with it citing "inflationary times" so the trend keeps going on.

Supply doesn’t have to drop by a third for prices to triple. Not just eggs but any good.
The nations flock size is down about 25% off normal. Three years of low/negative growth mostly due to avian flu is the cause of the price rise in eggs, not greedy egg barons.

https://www.ams.usda.gov/sites/default/files/media/Egg Markets Overview.pdf

Not debating if there is a supply shortage, but basically companies are able to use demand surge/supply shortage + "inflationary times" to dictate the price of the goods they are selling now because the economy has been distorted with uncontrollable inflation.

I don't think its a coincidence that the largest egg producer in the US recorded record profits in Q4 of 2022.

https://www.cnn.com/2023/01/13/business/egg-prices-cal-maine-foods/index.html

Basically many companies (see oil companies as well) are taking advantages of the current economic times in maximizing profits (some people call it greed others call it price gouging), either way they are just taking advantage of the current situation at the expense of the consumer.

PS: I have hunch that we'll be seeing record profits for gas companies pretty soon.

 

[JoeWras]

Not debating if there is a supply shortage, but basically companies are able to use demand surge/supply shortage + "inflationary times" to dictate the price of the goods they are selling now because the economy has been distorted with uncontrollable inflation.

Bad in the bad old days of late 70s, early 80s, the phrase "Everything is going up" was constantly bantered about.

It became an expectation, and was used by myself and others to ask for raises. It was used by car salesmen to screw customers. And so on...

As a working adult, with my first real job, the first time inflation expectations got broken in my mind was when gasoline prices crashed in 1985-86. That crash actually made a huge difference for my budget.

 

[wmc1000]

Our electricity bill has been negative for the since 2012 when we installed our solar panels. We generate about 10.8-11 megawatts and consume about 10 megawatts annually. The ROI was 4.5 years for our system that we paid for with cash.

We live in Southern Indiana - all electric heat pump home and barn. Last year's electricity use was 26.425 Mwh - Be hard to offset that kind of use with solar.

All lights are LED and am looking at possibility switching water heater to heat pump which would cut 1 large use and possibly upgrade builder grade heat pump to a higher efficiency heat pump that would reduce the electric heat strips use in colder weather.

 

[MichaelB]

The Employment Cost Index for 4Q’22 was released today. It came in at 1% for the quarter and 5.1% for the year. This was lower than the 3Q index.

This is the Fed’s preferred measure of wages and total employment cost. It is still above its average for the past decade but now in the same range it had before the GFC of ‘08. This is definitely an important number for the Fed, because it shows wages are not in an upward spiral with prices and their growth is leveling off.

 

[Freedom56]

We live in Southern Indiana - all electric heat pump home and barn. Last year's electricity use was 26.425 Mwh - Be hard to offset that kind of use with solar.

All lights are LED and am looking at possibility switching water heater to heat pump which would cut 1 large use and possibly upgrade builder grade heat pump to a higher efficiency heat pump that would reduce the electric heat strips use in colder weather.

We also converted to LED lighting throughout and added a variable speed pump to our pool. We have a roof that faces south azimuth of 210 degrees and 22 Kyocera panels with 22 Enphase microinverters to generate 11 megawatts. Our system was installed in 2012. Panels are more efficient today and so are the inverters. You should run an analysis of your area with PVCalcs or other online tools to see if it's even feasible. For us it was the best investment ever. In 2012 we paid a net $15,876 (after the 30% tax credits) to save $3623 per year on electricity. That was like buying a CD with a tax free return of 22.8% per year. Electricity rates have moved up significantly since 2012 so the savings are even higher. Solar only makes sense if you can position your panels south on your property and you live in an area where there is plenty of sunshine free of shadows.

 

[bobandsherry]

Our electricity bill has been negative for the since 2012 when we installed our solar panels. We generate about 10.8-11 megawatts and consume about 10 megawatts annually. The ROI was 4.5 years for our system that we paid for with cash.

You must live in a state with high electric rates, got a great rates on your panels, have a state that gives financial incentives or any/all of the three.

Payback in FL, so lots of sun and resulting heat to cool in summer, are decades. Saw one estimate for my neighbor who showed 15+ years.

My consumption shows 15 MWh for each of past 2 years. Average bill for each year has been $1600, 2300 sq ft home. At 4.5 years my electric would only be $7200, no way I'm finding anyone to install panels for that price, or even $11k before federal tax incentive. [emoji39].

 

[Fermion]

As a engineer and big DIY, I hate that all of these incentives and rebates only apply if performed by "professionals"

 

[pb4uski]

You must live in a state with high electric rates, got a great rates on your panels, have a state that gives financial incentives or any/all of the three.

Payback in FL, so lots of sun and resulting heat to cool in summer, are decades. Saw one estimate for my neighbor who showed 15+ years.

My consumption shows 15 MWh for each of past 2 years. Average bill for each year has been $1600, 2300 sq ft home. At 4.5 years my electric would only be $7200, no way I'm finding anyone to install panels for that price, or even $11k before federal tax incentive. [emoji39].

Yeah, our 1,450 sf Florida condo used $625 of electricity in 2022.

DW wants to spend megabucks on new windows but the payback is a century... seriously.

 

[Freedom56]

As a engineer and big DIY, I hate that all of these incentives and rebates only apply if performed by "professionals"

I agree that your rates and consumption have a lot to do with the decision to switch to solar. The quotes we received from "Solar Installers" were in the range of $36K to $40K using a single inverter and Chinese made panels. I am DIYer for many things but I was not going to climb our roof and install these panels. So we acted as the prime contractors. We purchased all the material ourselves and hired an engineer to generate a plan for the permit which cost us $600. We obtained the city permits on our own and applied for the rebates and application to Edison on our own. We then hired a professional installation company who installed our system for $7800 and we obtained the final inspections and grid connections with our power company Edison. It took them 2 days to install the system with a crew of four people. It cost us about $23K out of pocket. We received an $1831 rebate from Edison and then a 30% tax credit. Our costs would have been about $2800 lower if we used a single inverter and Chinese made panels. Our break-even would have been longer had we spent $40K on our system.

 

[Freedom56]

You must live in a state with high electric rates, got a great rates on your panels, have a state that gives financial incentives or any/all of the three.

Payback in FL, so lots of sun and resulting heat to cool in summer, are decades. Saw one estimate for my neighbor who showed 15+ years.

My consumption shows 15 MWh for each of past 2 years. Average bill for each year has been $1600, 2300 sq ft home. At 4.5 years my electric would only be $7200, no way I'm finding anyone to install panels for that price, or even $11k before federal tax incentive. [emoji39].

We would not install a system in Florida. There is far too much cloud cover that would lead to unstable and erratic power generation (at least in South Florida). Also, lightning strikes are not great for inverters. The rates with FPL are pretty reasonable so there is less of an incentive to install panels. I know a few people who live in Wellington Florida who are paying about $350 per month for electricity but for larger than average homes.

 

[REWahoo]

Payback in FL, so lots of sun and resulting heat to cool in summer, are decades. Saw one estimate for my neighbor who showed 15+ years.

The last time I ran the numbers on my location in TX the payback estimation was 18+ years. It has been a couple of years so out of curiosity I ran them again and came up with 14+ years, when I'm 90. Pass.

 

[ShokWaveRider]

You must live in a state with high electric rates, got a great rates on your panels, have a state that gives financial incentives or any/all of the three.

Payback in FL, so lots of sun and resulting heat to cool in summer, are decades. Saw one estimate for my neighbor who showed 15+ years.

My consumption shows 15 MWh for each of past 2 years. Average bill for each year has been $1600, 2300 sq ft home. At 4.5 years my electric would only be $7200, no way I'm finding anyone to install panels for that price, or even $11k before federal tax incentive. [emoji39].

Not only that, but my neighbor has an array of panels, and his original home insurance company would not insure them. Finally he switched to a company that would, and his insurance is 3 times ours, and our home is 1000 sqft more.

Has anyone else had this problem, it may be a Florida thing?

 

[bobandsherry]

Not only that, but my neighbor has an array of panels, and his original home insurance company would not insure them. Finally he switched to a company that would, and his insurance is 3 times ours, and our home is 1000 sqft more.

Has anyone else had this problem, it may be a Florida thing?

I've heard that too. Here's what I found, it really doesn't answer the specific question but does have lots of info on solar and homeowners insurance. Could be a company by company decision and not specific to FL.

https://www.progressive.com/answers/does-home-insurance-cover-solar-panels/

 

[bobandsherry]

We would not install a system in Florida. There is far too much cloud cover that would lead to unstable and erratic power generation (at least in South Florida). Also, lightning strikes are not great for inverters. The rates with FPL are pretty reasonable so there is less of an incentive to install panels. I know a few people who live in Wellington Florida who are paying about $350 per month for electricity but for larger than average homes.

I'm Central Florida in the Tampa area, serviced by TECO. Still pretty good rates.

Older homes (1990) here definitely can hit $350 or more in summer for sure. Neighbor moved from one of those, with the same size home and now more energy efficient he says bill is less than half what he used to pay. So I guess many factors to be considered when looking at payback.

 

[Koolau]

Wait, that can't be. I keep reading here that inflation is over.

The end of inflation must have been transitory. Oddly, as alluded to recently, my experience with inflation is much more intense than when inflation was first being talked about. I suppose that has to do with things w*rking through the supply chain. A few things popped right away, but now the big increases are being felt locally. I'm sure it also has to do with the mix of things that I need to buy but YMMV.

 

[Koolau]

Not debating if there is a supply shortage, but basically companies are able to use demand surge/supply shortage + "inflationary times" to dictate the price of the goods they are selling now because the economy has been distorted with uncontrollable inflation.

I don't think its a coincidence that the largest egg producer in the US recorded record profits in Q4 of 2022.

https://www.cnn.com/2023/01/13/business/egg-prices-cal-maine-foods/index.html

Basically many companies (see oil companies as well) are taking advantages of the current economic times in maximizing profits (some people call it greed others call it price gouging), either way they are just taking advantage of the current situation at the expense of the consumer.

PS: I have hunch that we'll be seeing record profits for gas companies pretty soon.

Broken record warning:

How much of these greedy, gouging company's stock do you own? It should be a lot since they now have pricing control on their side. But, be sure to dump their stock before the trend reverses and someone puts up the infamous billboard again. As always, YMMV.

 

[Out of Steam]

DW wants to spend megabucks on new windows but the payback is a century... seriously.

Replacement windows are very much oversold as a way to save on heating and cooling, especially since the seals in double-pane windows have a lifetime of no more than 25 years.

 

[pdxgal]

Yeah, it seems the smaller the problem the louder people scream about it but YMMV.

Well, even an hourly wage a few dollars dollars over minimum can still make it hard to get by in many places. The devil’s in the details.

 

[Koolau]

Replacement windows are very much oversold as a way to save on heating and cooling, especially since the seals in double-pane windows have a lifetime of no more than 25 years.

I'm sure that's true, but we replaced 17 large windows in our tri-level ca 1999. I think it cost about $9K (a local company that built and installed its windows - no shipping costs or fly-by-night installers.) We actually did see a decrease in heating - and especially cooling costs. Not sure the windows would have ever paid for themselves, BUT the difference in noise from outside was amazing. We used to hear every bird chirp, every car, every skate board. Following installation, it was quiet - almost too quite (in a good way.) YMMV

 

[Chuckanut]

Replacement windows are very much oversold as a way to save on heating and cooling, especially since the seals in double-pane windows have a lifetime of no more than 25 years.

I agree. The payback on the ones I looked at was at least 20 years and that assumes the seals stay good that long. There are other things I can do to my home that would increase the quality of life a lot more than new windows.

The ads for some of the window replacement outfits are very deceptive. One outfit tires to equate the 18% increase in housing prices from over a year ago with the return on getting new windows. Yah. Sure.

 

[ShokWaveRider]

Replacement windows are very much oversold as a way to save on heating and cooling, especially since the seals in double-pane windows have a lifetime of no more than 25 years.

like everything in the US that is over advertised and pushed to the masses. Folks will get over it.

 

[JoeWras]

Replacement windows are very much oversold as a way to save on heating and cooling, especially since the seals in double-pane windows have a lifetime of no more than 25 years.

Yep. Never buy windows for energy saving. You may save, but not much. Buy them for other reasons.