Supercore
Excluding food, energy and shelter? Krugman calls it ‘supercore’. I call it the inflation rate for dead people.
There are enough signs now that inflation is slowing quite sharply, not least second hand car prices falling off a cliff. We probably don’t need highly manufactured numbers from our least favourite Nobel Laureate.
It’s not just that prices might be stabilising, there are a number of other factors at play. The BLS website explains how the calculation of inflation in the US is changing. Essentially the spending mix will be based on 2021 data which was skewed heavily towards entertainment and apparel. That is no longer the case post-pandemic and spending patterns have shifted towards food because it is now so much more expensive.
The net result is the inflation measure for 2023 will over index on entertainment and apparel where prices are coming down most quickly. The 2021 spending pattern is no longer relevant, it was an outlier. Whatever happens, the rate will be understated even if it is directionally correct.
More broadly, The White House needs to get inflation down before November when the one-year run for the Presidency begins. Unemployment numbers will start ripping shortly once the tech layoffs show up in the data so by May/June we will have inflation falling (apparently) and unemployment rising. It’s not an environment that would result in the Fed continuing rate rises; the turn approaches.
Schlob
Is it the end of the road for Chief Lizard Overlord Klaus Schwab? It seems the WEF camp is not a happy one and his possible departure is probably the biggest news at what was otherwise a nothingburger. The usual procession of disgraced politicians turned up, including international war lord, Tony Blair.
Not content with the murder of 100,000 Iraqis, Blair now wants a ‘library’ of who has and who hasn’t been vaccinated because ‘it’s impossible to fight a pandemic’ without that. Which is rather odd because that’s exactly what we just did. Interesting choice of words ‘library’; libraries don’t get hacked, databases do. Library sounds calm and non-threatening. He’s still as smooth as he used to be when he convinced everyone that a couple of blokes with a sling shot had a nuclear weapon.
Al Gore also joined in to predict the end of the world before lunchtime. It was good of Al to leave his 14 bedroom home in the California hills to fly to Davos and tell poor kids in the third world to turn out the lights. Imagine being that generous. See you next year buddy.
If anything good came from it, it seems to be that being there is now a bit embarrassing. Mostly a gathering of the politically toxic. Bill Gates opted not to go, and Biden didn’t show up either. Our own Anthony Albanese thinks Davos is a get together for blokes called Dave, so he stayed home too.
The whole thing is sickeningly compelling somehow. I just watch in awe as these people bark orders at everyone else about how they should live. The chutzpah they have is really off the charts.
Coinbase
There are some subtle changes in sentiment from the Coinbase CEO Brian Armstrong. For a long time Brian has been a big supporter of ETH and NFTs, rarely mentioning bitcoin directly. Recently all mentions of .eth are gone and thematically he has moved very much towards bitcoin.
Two possibilities here, the first and most likely is that he’s bored, feels like a change and given the run up in price recently his marketing department changed his profile.
The second is that regulation is coming. Coinbase seems better connected to the SEC than some of the others. When they tried to launch an interest earning product the SEC closed them down with a sledgehammer immediately while everyone else carried on before getting hit with lawsuits.
If Brian sees risk, he ducks fast. If others know something too there might be more significance to the recent price moves than just short covering.
Apropos of nothing
There seems to be considerable interest in these mathematical oddities so here’s another.
5⁵ × 4⁴ × 3³ × 2² × 1¹ = 86400000 milliseconds which is exactly 1 day
Please do check that. I suppose it’s a fluke but I feel like I am missing something very obvious.
Euro-Trash
Fabio means “your money, wherever you need it”.
It’s revealing though, is it not? No European citizens are calling for a digital Euro. When they are asked if they would like one, they are confused believing their current euro’s are almost entirely digital, some of them say yes and continue with their day.
So, exactly like the Euro then?
The timetable is even more weird. In the Autumn the ECB will ‘possibly decide’ to launch the realisation phase. Fabio was emphatic in clarifying that even moving to the realisation phase does not mean a digital euro will be released.
We are looking at 2030 earliest. Fabio is 63 and his term ends in 2028 when he will be 68; he won’t want to wreck his mega fat juicy pension entitlements by having a digital balls-up just before he leaves. Here is GPT3 writing his retirement speech:
Full press release here which is quite good because they do address many of the primary concerns people have.