Entries by Wolf Richter

Social Security COLA for 2022 Biggest since 1982, But Still Won’t Cover Actual Cost of Living Increases for Many Retirees

Estimated Reading Time: 2 minutes

For retirees, 2021 was a nasty year: Red hot inflation and a stingy COLA. In 2022, they might fall behind more slowly.   Among the red-hot inflation data released today was the Consumer Price Index for All Urban Wage Earners and Clerical Workers (CPI-W), which is used to calculate the Cost of Living Adjustment (COLA) for Social […]

My “Wealth Effect Monitor” for the Money-Printer Economy: Holy Moly, October Update

Estimated Reading Time: 2 minutes

Editor’s Note: It is amusing, if not tragic, that those who complain the most about “inequality”, pursue monetary, fiscal, and tax policies, that make it much worse for the poor.  Asset price inflation favors obviously those with the means to own assets: stocks, bonds, and real estate. While inflation is a tax on all of […]

The Most Splendid Housing Bubbles in America: Holy Cow, September Update

Estimated Reading Time: 2 minutes

Even the Fed is getting antsy about this raging mania house-price inflation. Housing Bubble 1 is starting to look cute in comparison. House prices spiked 19.7% from a year ago, the biggest year-over-year increase in the data going back to 1987, according to the National Case-Shiller Home Price Index today. But the national index of this raging […]

China’s Crackdown on Debt, Tech & Evergrande Sends Frazzled Wall Street Titans to China

Estimated Reading Time: 2 minutes

The property sector and its debts are possibly the biggest financial mess in China’s history. The crackdowns by Chinese authorities on some of the biggest hype-and-hoopla industries have sent investors heading for the exits. There is a crackdown on debt to keep the financial system from imploding. There’s a crackdown on property speculation to tamp […]

Bank of Japan Ends its Massive QE that Started When Abenomics Became Economic Religion of Japan

Estimated Reading Time: 2 minutes

One of the largest central banks ends QE. End of an era for Japan: Large-scale money printing was one of the three official legs of Abenomics. In terms of the absolute mountain of assets the Bank of Japan purchased over the years, it is one of the top three QE monsters, along with the Fed […]

The Monstrous Flow of Free Money and the Shortages

Estimated Reading Time: 3 minutes

Free money destroyed the pricing mechanism, and demand has soared despite much higher prices. The shortages are not at Costco or Safeway, though they too might run out of a few weird items here and there. But other retailers are complaining about them, including apparel retailers and shoe retailers – yup, it took five weeks […]

Home Prices Dip for First Time off Crazy Spike, Price Reductions Surge, Sellers Emerge, House Sales Drop Year-over-Year, Inventories & Supply Keep Rising

Estimated Reading Time: 2 minutes

“Normalization” or “deceleration,” as this phenomenon is called, is setting in Prices of existing single-family houses, condos, and co-ops dipped in July, reverting to seasonality for the first time since 2019, amid surging price reductions. Single-family house sales dropped 4.1% in July, from a year ago, the first decline since the lockdowns. Condo sales rose. […]

Shortages in Charts: New & Used Vehicle Inventories Collapsed, Supply at Clothing Stores Gets Tight, Food Stores Near Normal

Estimated Reading Time: 2 minutes

Over-stimulated demand, tangled supply chains: shortages for some, plenty of supply for others. The historic stimulus from $5 trillion in government deficit-spending and from $4 trillion in Fed money-printing within a 16 month period resulted in a historic spike in consumer spending on goods. When the demand shock hit retailers and other companies, they were suddenly […]

Dollar’s Purchasing Power Plunged at Constant Speed

Estimated Reading Time: 2 minutes

Now it’s new vehicles, restaurants, energy.  Game of Whac-A-Mole as some price spikes slow while others begin. But it’s a lot worse than it seems. The Consumer Price Index (CPI) jumped 0.5% in July from June, after having jumped 0.9% in June, 0.6% in May, for a three-month annualized rate – the three-month momentum – […]

The Most Splendid Housing Bubbles in America: July Update, Holy Moly

Estimated Reading Time: 2 minutes

Raging mania house-price inflation. House prices spiked 16.6% from a year ago, the biggest increase in the data going back to 1987, according to the National Case-Shiller Home Price Index today, which was for the three-month moving average of closed sales entered into public records in March, April, and May. But in some cities, the raging housing […]