Latest Inflation Numbers and Discussion

[Fermion]

On the other hand, I keep reading that the typical US retiree does not have a lot of money, unlike the fat cats on this forum.

When their money is spent, say goodbye to inflation.

Not sure that drives inflation as much as the younger generations "living for today". Now THOSE retirees are certainly not going to have a lot of money.

 

[Koolau]

Jobs report is out. Mostly flat. Although creation was down slightly, so was participation. Wage pressure continues in the 4.5% range or so.

I admit, the few times I listen to CNBC (on XM) are on these reports. Steve Liesman was wringing his hands over the over 55 participation rate. Basically, we old people are not coming back, and the question is why? Will this cause continued wage pressure? The demographic continues to age and without participation in this group, employment will be challenged.

My opinion is that many of the over 50 group were treated poorly and not valued. If anything, "Let's hire young people!" Waddya expect?

Hey Steve, why don't you join us. The water is nice. (He's almost exactly my age.)


The topic of this thread is "inflation," and in my opinion, this report is just more of the same so don't expect the Fed to change their stance based on this.

Yeah, literally the year I turned 50 at Megacorp, I began to be ignored. Ignored for training, advancement, opportunities, etc. It was palpable. Of course, I was making a good salary, so it wasn't a big deal. It was more of a "nudge" toward the door than a shove, so I just went on doing what I was doing. When they finally realized I was enjoying myself, they changed my assignment - and I was gone the next Friday. Perhaps that was intentional - but that was okay too.

 

[NW-Bound]

Not sure that drives inflation as much as the younger generations "living for today". Now THOSE retirees are certainly not going to have a lot of money.

I don't know about the spending habits of my children and their cousins. They are all professionals, and I know that they are working their butt off.

 

[JoeWras]

Yeah, literally the year I turned 50 at Megacorp, I began to be ignored. Ignored for training, advancement, opportunities, etc. It was palpable. Of course, I was making a good salary, so it wasn't a big deal. It was more of a "nudge" toward the door than a shove, so I just went on doing what I was doing. When they finally realized I was enjoying myself, they changed my assignment - and I was gone the next Friday. Perhaps that was intentional - but that was okay too.

Yep. Liesman had a follow up on the older worker issue. He said some analysts note that we (USA) are not doing a good job of attracting older workers, especially those recently retired from primary jobs.

Ya think?

Me:
So much emphasis on young employment still, ignoring the unique needs of older employees.

 

[CaptTom]

...So much emphasis on young employment still, ignoring the unique needs of older employees.

I saw it slightly differently. In my years at MegaCorp, it looked to me like they were ignoring the unique skills and experience of older employees.

All the young folks coming up thought they knew it all, based on what they'd learned in school. Hiring mangers believed them. Upper management loved that they were paid a lot less than seasoned employees.

But when things got rough, it was always the experienced hands who knew how things really worked, and found solutions. I also noticed that the younger employees were happy to put in long, unpaid extra hours doing things the hard way. The old timers got a lot more done, in a lot less time. Again, management loved seeing those young go-getters working late, even if it was unfocused and unproductive activity.

 

[JoeWras]

I saw it slightly differently. In my years at MegaCorp, it looked to me like they were ignoring the unique skills and experience of older employees.

All the young folks coming up thought they knew it all, based on what they'd learned in school. Hiring mangers believed them. Upper management loved that they were paid a lot less than seasoned employees.

But when things got rough, it was always the experienced hands who knew how things really worked, and found solutions. I also noticed that the younger employees were happy to put in long, unpaid extra hours doing things the hard way. The old timers got a lot more done, in a lot less time. Again, management loved seeing those young go-getters working late, even if it was unfocused and unproductive activity.

I won't disagree. I was on my phone when I answered that. I had more in mind, but you put some of it in writing.

Aside from "paid less" is health insurance. Yet many older workers are happy to go without it if given part time.

I have more to say on this but it is dinner and perhaps slightly off topic of inflation.

Thank you for your reply, it is good.

 

[CaptTom]

...I have more to say on this but it is dinner and perhaps slightly off topic of inflation...

We were talking about inflation? Oh. Yeah.

Funny how we always seem to stray into the same topics.

Hey! You kids get off my lawn!

 

[Montecfo]

WSJ article suggests yoy slowdown in hiring my begin providing cover for the Fed to stand pat in September. Hiring has slowed sharply and so have "quits", suggesting less confidence in the job market.

It also notes the workweek ticked down to match the lowest level since April 2020.

Slower Hiring Offers the Fed Wiggle Room https://www.wsj.com/articles/jobs-report-july-today-unemployment-economy-d9af32f3

 

[NW-Bound]

Apple sales are down. Travel industry is still gunho due to revenge vacationing. That most likely tapers off next year.

 

[explanade]

Supposedly Larry Summers warned that inflation could increase again. He notes there's still high wage inflation.

So he thinks higher unemployment would really suppress inflation.

I may have misheard it but it was something like 1 year of 10% unemployment or 2 years of 6-7% unemployment would slay inflation, push it back down to the long-run target of 2%.

 

[NW-Bound]

Nobody knows how it will work out. I am just hanging on the edge, so I will be half wrong instead of trying to be 100% right and ending up being 100% wrong.

 

[JoeWras]

So perhaps a pause?

 

[pb4uski]

I saw it slightly differently. In my years at MegaCorp, it looked to me like they were ignoring the unique skills and experience of older employees.....

I had the opposite experience. My firm valued me and my decades of industry experience. Our younger folk would solicit my input on issues that they were wrestling with. Clients liked having another guy with a little gray hair in the room at proposal pitches and during projects.

 

[Car-Guy]

I had the opposite experience. My firm valued me and my decades of industry experience. Our younger folk would solicit my input on issues that they were wrestling with. Clients liked having another guy with a little gray hair in the room at proposal pitches and during projects.

+1 My mega corp valued experience. And they paid well for it making it dang hard to finally walk away.

 

[audreyh1]

Wow, we have a break until September!

 

[JoeWras]

+1 My mega corp valued experience. And they paid well for it making it dang hard to finally walk away.

Y'all are lucky to be in such Megacorps .

 

[NameTaken2]

Wondering if what I saw yesterday on a beautiful summer Saturday indicates lower discretionary spending caused by inflation.
Went by a normally busy restaurant at lunch time, lots of empty tables on their deck. Nearby, only a couple small boats tied up along the river where normally there are 10 or more mostly very nice cruisers.
In the evening, we went to a lakeside drive in restaurant that was a lot less busy than usual.

 

[CaptTom]

Supposedly Larry Summers warned that inflation could increase again. He notes there's still high wage inflation.

This occurred to me too, in a discussion about the UPS union agreement. UPS is finally realizing that they have to pay more, in some cases a lot more, to attract and retain good help these days.

It seems to me that a lot of companies have come late to this realization. Of course they're going to have to increase prices when they finally give in and start increasing wages. This has got to create inflationary pressure. Clearly, it ain't over.

Wondering if what I saw yesterday on a beautiful summer Saturday indicates lower discretionary spending caused by inflation.

I'm seeing the exact opposite. Driving around the Northeast lately, the roads have been packed. Traffic is as bad as it's ever been during the typical tourist travel times (toward tourist destinations on Friday, away from them on Sunday.) but even mid week, it's been noticeably heavier, and the out-of-state plates are everywhere.

Every tourist business; lodging, dining, parks and other destinations, are all packed. People are making up for all that time sitting home during the pandemic. It's even got a name: "Revenge Travel."

 

[Montecfo]

Travel remains the strongest part of the economy as has been true for some time. But there have been cracks elsewhere, most notably manufacturing, which has been in decline for months and retail which weakened more recently.

Overall the economy has been surprisingly resilient but massive deficit spending at the federal level is no doubt a meaningful part of the equation.

 

[pb4uski]

+1 My mega corp valued experience. And they paid well for it making it dang hard to finally walk away.

Yes, it was very hard to walk away. They paid me very well for what I did and I enjoyed the work and the people, but I ultimately decided that we had enough $$$ and time to do what we wanted was more valuable than the kids getting more inheritance.

 

[Chuckanut]

Travel is strong from what I have seen both in the USA and internationally. I agree that a lot of it is making up for two years of Covid putting a huge damper on travel.

Like many, I am fighting higher prices via the classics ‘substitution’ method taught in Econ 101. The cost of a senior lunch at a local diner type restaurant has gone from about $10 plus tax and tip to $16 plus tax and tip. So now I go to the local senior centers where lunch is rarely over $10 total and the food is very good. The cost for me is voluntarily working a lunch once a month. It’s optional, but I believe in giving something back.

I

 

[NW-Bound]

Travel is definitely strong. But I wonder how other areas of spending fare. Apple recent quarterly report was not great.

People may just shift from acquiring stuff to experience. Will their money eventually run out, and tourism declines again?

 

[explanade]

One thing I notice about travel the last two years, prices, especially of car rentals, decline the closer you get to travel.

Before the pandemic, I would make flight, hotel and car reservations 8-12 months in advance and the prices tended to rise as you near the travel dates.

Last year and this year, I've saved hundreds each time rebooking car rentals. OTOH, the rental prices were high and I booked to make sure I had something but I would check again within 3-6 weeks of travel and find much better prices.

I also rebooked an upcoming stay in London, not a big savings, like $150 or so. Though in that case I went from a refundable booking to a non-refundable one.

 

[USGrant1962]

One thing I notice about travel the last two years, prices, especially of car rentals, decline the closer you get to travel.

Before the pandemic, I would make flight, hotel and car reservations 8-12 months in advance and the prices tended to rise as you near the travel dates.

Last year and this year, I've saved hundreds each time rebooking car rentals. OTOH, the rental prices were high and I booked to make sure I had something but I would check again within 3-6 weeks of travel and find much better prices.

I also rebooked an upcoming stay in London, not a big savings, like $150 or so. Though in that case I went from a refundable booking to a non-refundable one.

We repriced a ~$2000 SouthWest direct flight for two from BWI to Grand Cayman a couple of months ago and got ~$700 back! As you mentioned, our original booking was about 8 months ago, mostly so we could get one if the few puddle-jumper seats to Little Cayman. We repriced a couple of months ago and flew last month.

The Points Guy daily email had an article about repricing SW so I looked and - holy crap! Our ~$1000 each tix were down to ~$650 each. I called SW and they took care of it, even taking time to discuss the Early Bird Check-in options and which class included them or not. I was really impressed by SW customer service, but I still hate their "grab-a-seat and save some seats" boarding approach. Way too much "fraud" there - every empty seat in the first half of the plane has stuff on it.

 

[JoeWras]

Travel is fluctuating. The latest is that domestic is normalizing, and international is still strong. Due to COVID protocols, it was very hard to travel international last few years whereas domestic loosened up last year and international this year.

Source (one of many): https://www.flightglobal.com/airlin...ng-haul-at-expense-of-domestic/154406.article

You also hear various anecdotes about theme parks and what have you.

Here's my anecdote: we had a tour to Canada (call this domestic) that was cancelled and consolidated. 4 dates were consolidated to 2.

Contrary data: TSA says domestic travel is still up. Look at this chart. It is up from 2022. It is very close to 2019. Back to normal? https://www.tsa.gov/travel/passenger-volumes