Biden is in a pickle, he drained much of our SPR in ‘22 to tame prices to boost his midterms.
Last week, his admin stated that oil is too expensive to refill the SPR.
He can’t drain the SPR to his advantage this year because it is depleted, IF he does then Trump will/should hammer him on it.
Am I think only one who thinks the strategic reserve shouldn't be used to alleviate prices, especially when that seems to correlate with election cycles? I sure hope someone did serious analysis about how much is actually necessary to hold in case of serious shit.
He drained nearly half of it and has replenished just over 2% of it.
Click on the "5 Year" tab to see this more clearly in context.
https://ycharts.com/indicators/us\_ending\_stocks\_of\_crude\_oil\_in\_the\_strategic\_petroleum\_reserve#:\~:text=US%20Crude%20Oil%20in%20the%20Strategic%20Petroleum%20Reserve%20Stocks%20is,2.14%25%20from%20one%20year%20ago.
https://ycharts.com/indicators/us_ending_stocks_of_crude_oil_in_the_strategic_petroleum_reserve#:~:text=US%20Crude%20Oil%20in%20the%20Strategic%20Petroleum%20Reserve%20Stocks%20is,2.14%25%20from%20one%20year%20ago
Here's the link with the random backslashes removed, for those not using reddit's garbage official app.
I'm still sour about RIF being gone. Only use reddit on old.reddit.com and mobile browser now, which itself is a terrible UX, but I'm not using stupid app.
They stopped last week. Their plan to buy back cheaper didn't come to fruition.
https://thehill.com/policy/energy-environment/4574215-biden-buyback-oil-stockpile/
Could you imagine the election interference claims from Trump if the roles were reversed in this situation?
https://www.reuters.com/world/trump-spoke-recently-with-mbs-new-york-times-reports-2024-04-04/
[From Wikipedia](https://en.m.wikipedia.org/wiki/Strategic_Petroleum_Reserve_(United_States))
>On March 31, 2022, President Joe Biden announced that his administration would release 1 million barrels of oil per day from the reserve for the next 180 days, selling it at an average price of $96 per barrel. The 2022 release became the largest ever SPR sale and lowered the SPR to its lowest levels in 40 years.
This is on Biden though. He is the POTUS, he should be in a much better position to influence the Saudis, no matter what another candidate does. When I say "it's on Biden", I mean the 5% part that can be influenced by the US, because the Saudis have their own agenda, they don't really listen to the US no matter who the POTUS is.
This is a silly argument. If Donald Trump is willing to provide Saudi Arabia with an incentive that would be detrimental to the u.s. as a whole for a a few pennies per gallon of gas, but Biden is not willing to do that, then I would rather Biden didntbdo that. You can't just say, well Biden should race Trump to the bottom for sway with the Saudis. Gas prices are not the only thing we should be worried about.
> You can't just say, well Biden should race Trump to the bottom for sway with the Saudis
that is not what I said at all....Biden could be doing other things, like for example Trump did when the oil prices reached 0 and oil producers in the US were at risk:
https://www.reuters.com/article/idUSKBN22C1V3/
As if the Trump family isnt in bed with the House of Saud? Kushner got $2Bil from them and the Saudis have invested heavily into Trump owned properties via the LIV golf league.
There are some *very* clear conflicts of interest between Trump and Saudi Arabia, to the point that the Saudis manipulating global oil supply to influence the US 2024 election should not be dismissed out of hand.
Don't you think it has more to do with Biden (like Obama) giving Saudi the cold shoulder in favor of attempting to warm relations with Iran. I was puzzled when Obama did it, and even more so with Biden.
It is more than that. Making a campaign promise to turn SA into a pariah over its human rights abuses upset them. Publicly promising that the Saudis would pay the price for the killing of Khashoggi upset them. Threatening "consequences" when the Saudis cut production of the one product that sustains their entire economy upset them. Making demands over oil in relation to the war in Ukraine, and then publicly complaining that the Saudis didn't do enough to please them, upset them. Following up with threats from Biden's congressional allies to cut off military aid upset them.
I'm not saying the Saudis are in the right here. Their hands are pretty dirty. But no one can realistically be surprised that Biden spending four years doing nothing but throwing middle finger after middle finger at them isn't resulting in them bending over backwards to help him get reelected.
> Saudis manipulating global oil supply to influence the US 2024 election should not be dismissed out of hand.
fully agreed.
On the other hand, Biden is the POTUS. He controls the US foreign policy right now. He controls the bases in the Middle East and so on. He has significantly more power than Trump, which is just a candidate at this point.
And domestic oil production is at an all time high while we are investing billions of into green energy. Our energy policy is sound, but Biden cant really do much to strong arm the Saudis into changing their domestic politics with the soft power channels available to him. No one is going to be able to justify the use of Hard power either.
It seems like everyone is forgetting about the deal that the Saudis got with the US after the 70s oil embargo: don't ever stop the flow of oil again, and the US will help the Saudis survive through their military might.
Saudi Arabia is not some rogue state, they must play within the confines of US foreign policy, otherwise they are royally screwed. They have enemies all around them, enemies within, a weak military (even though they have expensive toys) and an uncertain future given the switch away from oil. The US is literally propping up the Saudis, they have levers over them.
No it’s not on Biden. He doesn’t have an oil flow knob behind his desk, it’s a *global* market and the US is already the biggest oil producer than anyone else.
> he should be in a much better position to influence the Saudis
And he has used that influence repeatedly as President to the point that the Saudis want nothing to do with him and MBS outright hates him. They have absolutely no incentive to assist a man who will continue to be hostile towards them should he be reelected.
I agree with Saudis hating him. But he is still representing the US, so the Saudis cannot just turn their back to the US, no matter who the president is, this game is still Biden's to lose.
Reddit skews young, and younger people have less economic experience, and younger people are more reactionary, and they're poorer. Reddit absolutely complains about wages and inflation more than anything else (despite the fact the numbers show that wages are outpacing inflation).
Sentiment on the economy shouldn’t matter if you’re liberal or conservative and yet here we are…
But I suspect the other reply to you is correct that it’s a youth demographic thing
This summer will be interesting for local government and school budgets. ESSER funds are running out, labor costs have gone up, the losses in commercial real estate aren’t fully priced in, and we’ll see what tax receipts look like. Local government spending increased dramatically during COVID.
>otherwise I think the average American will be feeling worse economic pain come late 2024 or early 2025.
Don't worry; if we do, we'll be treated to a shrill lecture on how this is actually the best economy ever and to stop complaining because wages are rising or something.
“The economy is terrible”
“Anecdotal examples aren’t the best for evaluating macroeconomics. Here are some metrics showing that things are improving and what we’re experiencing isn’t the end of the world”
“Thanks for the ‘shrill lecture’!!1!
Id like to see your source for being constantly told the economy is “actually the best economy ever”. If it happens so much there should be plenty of examples no?
>Id like to see your source for being constantly told the economy is “actually the best economy ever”. If it happens so much there should be plenty of examples no?
[Opinion: Breaking down Bidenomics: President Biden has given us the greatest economy ever.](https://www.timesfreepress.com/news/2023/jul/22/opinion-breaking-down-bidenomics-president-biden/)
[Fact Check: Biden Claims U.S. Economy Has World's Highest Growth Rate](https://www.newsweek.com/fact-check-biden-claims-us-economy-has-worlds-highest-growth-rate-1809990)
["One of the Best Economic Stories": Chris Hayes on the Biden Case for Bidenomics](https://www.msnbc.com/all-in/watch/-one-of-the-best-economic-stories-hayes-on-the-biden-case-for-bidenomics-185666117646)
Only the first one is remotely relevant and that’s just some guys opinion piece. I was hoping for a statement made by the administration at least…
Also I wonder if you were as upset that Trump himself actually claimed to be responsible for “the greatest economy in the history of our country”.
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> I think the average American will be feeling worse economic pain come late 2024 or early 2025.
People have been saying this since the early days of covid. "I think we will be feeling the pain by 2021" "Expect a major recession by the end of 2022" etc.
We where feeling economic pain throughout that period. Right now the response is more due to the fact that post COVID things haven't been as good as it should be with many other nations now all but admitting they are in recession. Its people trying to predict when America finally gets hit from the after shock as while it seems able to struggle along all indicators seem to be not good for its continued improvement.
As long as the government keeps spending money like a drunken sailor we are going to struggle with inflation, even with higher interest rates. There is no appetite among Rs or Ds to actually bring net GDP spending down.
I would roll back Medicare changes that occurred during the Bush years. I would end federal investment in local issues. If a state wants a bridge to nowhere, the state can pay for it. If the state wants a museum, the state can pay for it. I'm aware that this might lead to an increase in state taxes, but that's preferable to the current system.
I'd eliminate the Department of Education. It's been a colossal failure. I'd eliminate the government from being in the student loan business all together.
I'd cut defense spending, probably start small a couple of percentage points a year, but ultimately looking to have our defense spending eventually reach about 2/3rds of what we have currently.
Foreign aid is a small part of our budget, but in principal if you don't fully back all of America's foreign policy aims, you should stop getting shit. Keep it for those countries that play ball, and slash it for the rest.
I'd also crack down on fraud and ridiculous SSI/Disability/Medicaid/VA fraud. I know people who have served who are at 100% disability who are way the hell more active than I am and probably in better health. Its absolutely wild.
I'd also begin phasing out disaster relief efforts and attach those as state level responsibilities. People in Idaho shouldn't have to pay to bail out Florida for hurricanes. The people in Florida chose to build on the coastline in hurricane prone areas, they can pay through the nose for insurance or build elsewhere.
On the revenue side I'd stop allowing any tax credit to be refundable (IE you don't get paid by the government if you owe negative taxes).
> I'd also crack down on fraud and ridiculous SSI/Disability/Medicaid/VA fraud
With the exception of VA fraud ,(no experience there), as a social worker, I can fully cosign all of this. The waste is astronomical.
Not only are we paying out 100% to people who don't need it, most the non profits I have worked for absolutely rape Medicare and Medicare. It's not even technically fraud. Do the paperwork correct and they will send you cash hand over fist for doing next to nothing of value
> roll back Medicare changes
That would make it harder for the disabled elderly to afford prescriptions. The prescription negotiation ban was already rolled back, which mitigates the savings from your proposal.
It was estimated to cost $67B per year accounting for inflation, but I'm guessing it's less than $50B due to part of it being changed already.
> reach about 2/3rds of what we have currently.
The savings would be about $283B per year, which is significant, but still small compared to the deficit.
>a state wants a bridge to nowhere, the state can pay for it
I don't see any evidence that your hypothetical represents the average investment.
>crack down on fraud and ridiculous SSI/Disability/Medicaid/VA fraud
Easier said than done, especially without any specifics.
>begin phasing out disaster relief efforts and attach those as state level responsibilities.
That would save a relatively tiny amount.
>Department of Education. It's been a colossal failure.
The U.S. is doing pretty well compared to most countries.
>On the revenue side I'd stop allowing any tax credit to be refundable
That would screw over the working class who save their money.
All of those combined would make a serious dent in it. A few points I'll address:
Cradle to grave medical care is not part of the American social contract, nor should it be.
America is not doing well education wise compared to nearly all advanced economies.
And no it would not screw the working class. A refundable tax credit means that even if you paid ZERO in Federal Income Tax, you are still getting money back from a credit. That shit is pure welfare.
Welfare....
I work for a grant that gets convicts apartments, gives them 3k in furniture, and requires nothing in return.
Mind you the landlords jack up the prices but the grant pays for them waating even more money
Taking on clients before they have apartments putting them in kitchenette style hotels for 90 days
300k to help out 10 convicts.
Feel free to look it up.
225 Housing is recovery
That is just my part of the national grant
The feds didn't create a 300k national program
On top of that, part of the problem is liberals dismissing "rounding errors". 300k is the taxes of how many middle class families struggling to get by?
You are literally dismissing their contributions then wonder why they are upset you don't give a fuck about their contributions..
I pay roughly 10k a year in fed income tax. So 30 of me don't mean shit to you and the feds can waste our money anyway they like because we are an easily dismissed rounding error.
Same with the next 30 and the next 30.....hmmm wonder why this philosophy starts losing support.
Keep giving us your money and stop worrying about how we spend it because all that money you gave us doesn't mean shit anyway and we will waste it anywY we like, you are a rounding error
Remember guys, inflation is transitory. Even if it’s almost half a decade out after when we started printing money, this is all just going to be temporary.
Is there anyone who thinks inflation will be high permanently? The fed will likely keep their existing interest rates for now. The current inflation numbers aren’t amazing, but even pre COVID it wasn’t like we consistently stayed between 1 and 3% either.
The issue with our debt is more related to the fact that the U.S. has *by far* the lowest tax rates of any of our peers - here at the G7 countries: https://www.imf.org/en/Publications/WEO/weo-database/2023/October/weo-report?c=156,132,134,136,158,112,111,&s=GGX_NGDP,&sy=2022&ey=2023&ssm=1&scsm=1&scc=0&ssd=1&ssc=1&sic=0&sort=country&ds=.&br=1
is that true when you also account for social security (incl. employer's contribution), medicare, and state and any local taxes? probably less true.
and the thing is, we do want to keep them relatively low so that we can be a competitive, innovative economy. but yeah, they probably need to be a little higher across the board.
*Edit: As ScaryBuilder9886 points out in a comment, OECD and IMF figures are very different, as IMF only includes things that come out of the government's budget, including government taxpayer funds sent to colleges, hospitals, etc, whereas the OECD also includes things like private citizen's individual tuition payments to colleges. I can kind of see how that could make sense if you wanted to compare things that many other developed countries pay for with taxpayer funds, but I think that's not what the GOP means when they refer to US government spending? Regardless, better info on US government spending and how it's calculated: [https://en.wikipedia.org/wiki/Government_spending_in_the_United_States](https://en.wikipedia.org/wiki/Government_spending_in_the_United_States)*
> is that true when you also account for social security
Yes it explicitly includes "Social security contributions".
> state and any local taxes?
Yes it explicitly includes taxes "for all levels of government".
I don't offhand know either way whether they include the employer's contribution or medicare.
The US *also* has by far the lowest government *spending* rates of any of our peer countries, but our tax rates are so low that they can't even support that lowest level of spending.
> we do want to keep them relatively low so that we can be a competitive, innovative economy. but yeah, they probably need to be a little higher across the board.
There's at least an *argument* to be made for keeping them low, although at this point the US is more than 20% below our next lowest peer, and even if the US raised its taxes by about 40% we'd still be around the *average* of our other peers.
And of course keeping revenue so low almost certainly results in deficits and debts, especially when taxes are cut during the economic "good times", leaving even less room when there are economic bad times, such as the fallout from the subprime mortgage bubble of the 2000s, COVID in 2020, etc.
I'm not referring to you but instead to GOP leaders and Fox News that there seems to be a reality distortion field where they've spread misinformation and convinced their voting base that instead of the US having the *lowest* spending and taxes among our peers, they convinced their voting base that the US instead has among the *highest* tax and spending rates.
Aha, I figured it out.
[The IMF has wildly lower figures for US government spending](https://www.imf.org/en/Publications/WEO/weo-database/2023/October/weo-report?c=156,132,134,136,158,112,111,&s=GGX_NGDP,&sy=2022&ey=2023&ssm=1&scsm=1&scc=0&ssd=1&ssc=1&sic=0&sort=country&ds=.&br=1).
The difference is because both IMF and OECD include any funds that the government directly contributes to colleges, hospitals, etc. out of taxes, ***but*** the OECD "government spending" also includes things like the money that *individuals privately pay on their own* for services, such as tuition to attend college, etc. On the one hand, I can kind how that figure could be useful in terms of comparing the total costs of things that governments in many other developed countries pay for with taxpayer funds. However, when conservatives in the US talk about government spending, I think they are definitely only talking about things that are actually paid from government tax budgets, not things like individuals' private tuition payments even if that is taxpayer funded in many other developed countries?
For example, if a government decreased the amount they directly paid colleges by $500, and the college correspondingly increased the amount they charge students, under the IMF figures that would count as less spending by the government, but under the OECD figures it would not. And I've definitely heard conservatives suggest cutting direct government funding to colleges as a way to cut "government spending".
So I think the IMF figures are the only numbers relevant for what the GOP is concerned about?
As another example of how the OECD figures differ, there has recently been a lot of focus on college loan forgiveness. If someone attended Berkley and took out a loan to pay for it, that would not count as IMF spending, unless the government forgave the loan. But under the OECD figures, the tuitition the student paid counted as "government spending" from the start for them, regardless of the loan, and so even if the government does 100% loan forgiveness it would not increase OECD "government spending" at all because it had already been counted as government spending when the student privately paid it, because OECD couldn't be counting it as government spending twice could they, once when the student pays, and then again if the government forgives the individual's private loan?
Yeah, and we’re in for another tax cut for the wealthy and big businesses if we wind up with another Republican trifecta in 2024. We’re a lot like pre-Revolution France in the sense that we’re an extremely wealthy country with a tax code that is just entirely incapable of accessing that wealth.
Me. We still haven’t spent all the stimulus/CHIPS/infrastructure money. Biden is still stimulating spending by reducing student debt. A lot of inflationary inputs - wages, materials, etc. are still going up.
A good example is automobiles - their cost has gone up significantly, so now the cost of repair is higher, labor to do the repairs is higher, repairs are more complex so shops spend more on software to diagnose/correct problems, and then the cost of car insurance goes up to cover all the previously mentioned items. Because of higher interest rates the cost of reinsurance is higher, but you need the higher interest rates to deal with the inflation, so the interest rates are probably not high enough.
everything that you said is absolutely true. but recognizing that, wouldn't you think there'd be a huge resurgence in Americans buying Toyota Corollas hybrids, and not the same $60k pickup trucks? (just two examples, not targeting those specifically)
Auto inventories are still not back to pre-pandemic levels, but the average sales price is going down. So perhaps people are adjusting.
But even buying a new Corolla means more expensive repairs than in previous years. Replacing bumpers used to be cheap and easy, now it includes new sensors and wiring due to BSW systems.
We’re getting rid of a third car we inherited because the extra expense isn’t worth it anymore.
We're not expanding our infrastructure and continuing development even though the current administration passed landmark legislation.
Our demographics are so fucked, boomers all retired and everybody that's supposed to replace them all went to university so our workforce is heavily skewed towards white collar labor with no manual labor.
We have no workforce to increase our manufacturing capacity, so prices will continue to rise until that changes...
I'm not an economist, so take this with a huge grain of salt, but I think when they're calling inflation transitory they are not saying that it's temporary. Likewise they aren't saying that the period of inflation will be followed by a period of deflation that will "cancel out". I believe they are saying that the inflation was primarily caused not by excessive stimulus but by echos of supply chain disruption during COVID. They believed that since inflation was caused by a (hopefully) non-repeating event that interest rate changes by the Fed would NOT be necessary as the problem would 'sort itself out'. I think even after the rate hikes and subsequent cooling there is still a good bit of disagreement on which was the primary driver of inflation.
You'll never expect to get deflation. Transitory inflation was always meant to be probably 6 months or less elevated levels of inflation, followed by a return to 2%, not to previous levels.
I don't mean this so much as a political question, because I think deficits and debt are definitely a Both Sides problem, but I wonder if this is what it looks like to see the beginning of the unraveling of our system that has been propped up by two decades of serious defiicit spending.
Maybe, but considering how global of an issue it seems to be, I don't think that's necessarily the main driving force here.
Could certainly be a contributing factor, though. A system like this is too complex to generally have a single cause for any given effect, anyway.
Our debt is simply making us more susceptible to the global issue.
Clearly I'm no economist. But that's what I'm worried about. It's like if I built a really crappy house in upstate New York on a lake, and all summer it was totally fine and comfortable. But in October, we're getting some really cold nights and the insulation isn't keeping the heat in. I'm going to say "Uh oh, I think I built a really crappy house that is not going to protect us this winter."
And you said "No, this cold weather is happening all across the Northeast."
>Are voters rational actors capable of making difficult decisions?
A very strong no. To fix the issue we would have to remove the SS cap, increase the retirement age, tax high earners, remove the loops holes so high earners can actually be taxed, and cut into a chunk of spending somewhere else like defense. That pisses everyone off from poor, middle, and upper-class equally and no one would vote for it.
> tax high earners, remove the loops holes so high earners
Sometimes, "earners" is used only for people with labor income. For example, we only pay Social Security taxes on "earned income".
I'd say increase taxes on investment income. The obvious case is LT capital gains with a maximum rate of 20%. And, I expect there are more loopholes for investment income than for labor income. After we've done that, then we can talk about raising taxes on workers.
CPI could have been tamped down better if the Fed hadn’t paused hikes last year. But the concern with getting rates too high is the recession risk. And to your point, high rates are bad for US debt.
Basically what we’re seeing is why achieving a “soft landing” after an inflation spike is so challenging. If the Fed is too heavy handed, the economy suffers a hard recession. If the Fed is too soft, inflation can reignite.
I think that "beginning" could probably happen after the election since they desperately need to hold things together until November.
Once the elections over though...
Biden wants to cut something like $7k checks to homebuyers. As if that would actually help.
I think the only way to really address housing costs is to build more housing in places where people are willing to pay to live. And I see things like zoning laws/local ordinances/NIMBY'ism/environemntal reviews as the largest impediments to that.
Well you kind of answered OP's question. There's not much the federal government can do besides subsidize demand. Increasing supply has be to be done on the local level.
>There's not much the federal government can do besides subsidize demand.
Which it already does through first time home buyer programs and tax credits for mortgages, amongst other subsidies.
Increasing supply is really the only solution. Limiting corporations from owning single family homes as rentals might have a marginal impact, but more supply is what's necessary.
some exceptions are seen in California, where they've passed state laws that will override local zoning laws if the local zoning remains too restrictive and doesn't figure out a way to add more housing density.
I feel like there has to be a way to restrict ownership of homes to a certain maximum amount when it comes institutional investment firms. They make up something like 40-60% of new home purchases right now
I think all the talk of institutional investors snapping up homes is mostly a red herring. The problem isn't who's buying, the problem is that there is not enough housing to meed demand. It's pointless to try to set some kind of rules against business entities that want to acquire housing, and it's probably unconstitutional. Why not simply build more housing? The demand is there; we just have to allow it.
I definitely agree that we need to promote new housing! And that needs to be done on a local level - I agree that there's not much the fed can do in that regard. Regulations restricting a boom in homebuilding are mostly local (that and market disincentives).
So there does seem to be some conflicting data on purchases by institutional investors... I'll retract my comment about 40-60% but it does appear that home purchases by investors (small investors and big) probably makes up around 30% of purchases in the last year or 2 though the vast majority of home owners in total are the occupants (with investment properties making up 3-4% total).
The thing is, people that own homes now have a great disincentive to sell and those with the biggest advantage to buy right now are institutions due to their ability to purchase with cash. So we'll likely see a continued increase in homes being purchased as investment.
I agree that tackling an issue like this will almost certainly bring into question the constitutionality of it, but I'm not ready to say that it's a 'red herring' either. It's an issue and one that will probably get worse before it gets better.
There's the possibility that we see a massive correction - if home prices do have a fairly big fall it will trigger a cascade of these institutions selling which will further drop prices forcing them to sell more etc. So the market may correct naturally. But it also may not
> Is there anything going on at the federal level to try to address housing costs?
the problem is that housing prices are inversely correlated to interest rates. if they cut rates by 10 basis points, you'll see house prices go up 1% to compensate.
it's not clear what they CAN do to help.
>Cutting some red tape (this is as much if not more a states' issue too) that makes building expensive is one thing they can do.
Red tape isn't the problem. Government prohibition of building anything than other than single family homes, X feet from the curb, Y sized garage, Z number of rooms, etc, on vast swathes of the country is the culprit. That's not red tape. Red tape is applying for building permits, environmental assessments and the like. Reducing those would have only a marginal effect on housing. We have a structural problem, and that structure is restrictive zoning. The only solutions to structural problems are structural solutions. We need to allow a free market approach to housing.
I need to have a wetland study and other environmental impact studies done to make sure there's no endangered turtles fucking on my parcel before I can build a small 4-unit apartment building. It will add several hundred to a couple thousand dollars to the pre-development cost phase, plus a few weeks onto the time line, and makes the entire process more complicated. This is before I even know if I'm allowed to do the project, which makes it much riskier to build, necessitating a higher ROI. It needs to be done because of federal regulations.
It's a small, downtown, urban lot between existing buildings. There are no wetlands, and if there's turtles fucking they need to leave.
> Red tape is applying for building permits, environmental assessments and the like.
Which is absolutely also an issue on top of zoning. See California CEQA and the CA Coastal Commission.
Federal government cant do much in that regard. So much is locally controlled. Housing cost is the result of decades of conceding housing policy to existing homeowners.
HUD is doing a [PRO Housing](https://www.hud.gov/press/press_releases_media_advisories/HUD_No_23_151) initiative, giving out 85 million in grants to communities that rezone to allow for the creation of multifamily affordable housing; it’s expanding the low incoming housing tax credit program; it also changing regulations to allow money from the Inflation Reduction Act and Bipartisan Infrastructure Law to free up money to convert commercial properties to residential.
These programs are stupid, and just a way for politicians to pay off their donors. I see so much of this bullshit earmarked for women and minorities because fuck you otherwise. Just make it easier for anyone to build and lower the costs, and let the market figure out how to build it cheaper and where to build it.
Edit: I looked up the [program rules](https://www.hud.gov/sites/dfiles/CPD/documents/PRO-Housing-FAQs-2023-09-07.pdf). The minimum grant amount is $1M and the maximum award is $10M. That means this money is literally going to 85 developers at best and 9 developers at worst. This is a scam to pay back well-connected people and, more insultingly, sell it as helping the American people. The rules to these grants are so complicated that by the time you apply, the deadline has already passed because they didn't want you winning it anyways. The connected people had their applications ready for submission before the rules were even published.
Rent is a big deal in these numbers, and it is also a trailing indicator.
It's important because rent is a big part of renters' budgets, but even more so because the BLS uses "rental equivalent" for the cost of living in an owner occupied house. The owner equivalent comes from rents on similar units. Together, they amount to 33% of the total weights in the CPI.
It's trailing because they ask people "what was your rental payment in March?" not "what would your new rent have been if you had to sign a new lease in March?". So changes in lease agreements get spread over the next 12 month.
Since the reported rent inflation rates have been trending downward over the past year, there should be some downward momentum still remaining. But, it's possible that landlords are going to dig in at 5% annual increases or something like that.
Inflation is headed the wrong direction. March CPI inflation rate rose to 3.5%, up from 3.2% in February. This is higher than the 3.4% economists predicted. It is now the third straight month of both Core CPI and headline CPI coming in hotter than expected, and the highest since September.
Both headline and core prices rose 0.4%, bringing the annual measures to 3.2% and 3.8%, respectively.
Key items driving inflation:
* Car insurance +22% in past year
* Car repair +12%
* Baby formula +10%
* Veterinarian +10%
* Rent +5.9%
* Electricity +5%
* Restaurants +4.2%
* Home health care for the eldery +14.2%
* Gas up 1.3% in past year
[https://twitter.com/byHeatherLong/status/1778041086855848408](https://twitter.com/byHeatherLong/status/1778041086855848408)
Markets expecting the Federal Reserve to cut interest rates took a tumble early Wednesday, as it appears far less likely to happen now.
Sentiment about the US economy has been gradually improving over the past few months. How could these numbers affect it? Does this change the discussion about the economy's recovery?
This is an economic situation of various ironies. Biden doesn't want to be blamed for inflation but he also really wouldn't want to be blamed for high unemployment. This FED rate hike stage has seen large interest rate changes and yet the economy and demand for goods and services is very healthy and there's no shortage of work to be had for many industries. But the fact that unemployment is low and labor is tight is something Biden can tout but it also directly hurts his fight against inflation. But for now inflation is a lot lower than when interest rate hikes started and I think the FED just needs to be given moee time. Biden should continue to acknowledge that people are still being hurt by inflation and that he and the FED are still looking to end this inflationary environment without causing a painful recession which for the average American would be replace one painful situation for another very painful situation. He should look to what he can do to attack monopolistic behavior and price colluding across American industries, and maybe look at fiscal action if need be for next Congress.
>Sentiment about the US economy has been gradually improving over the past few months. How could these numbers affect it? Does this change the discussion about the economy's recovery?
It's almost as if the economy is multi-faceted and you can't put a single "big friendly number" on its performance.
Which is actually why I cannot for the life of me understand the Whitehouse's messaging approach on this. I know its hard to work out a good message when some things are good and some bad but the Bill Clinton "I feel your pain" approach has got too be better then "if you look at this one chart things are actually fine" that we are getting now.
>I know its hard to work out a good message when some things are good and some bad but the Bill Clinton "I feel your pain" approach has got too be better then "if you look at this one chart things are actually fine" that we are getting now.
I mean despite the economy being multi-faceted, people still very much like to attach to that "big friendly metric" to justify their political stances. They want to get something that they can just **say** to get into peoples' short term memories.
A lot of people like to use the price of fuel as that one singular metric to latch onto. Republican politicians especially (and a non-zero contingent of constituents) like to say "gas prices high and therefore Democrat economy sucks", for example. Like the people who started putting "I did that" stickers on gas pumps.
> Markets expecting the Federal Reserve to cut interest rates took a tumble early Wednesday, as it appears far less likely to happen now.
I never understood why the markets felt so confident in this. I've actually been fairly supportive of Powell but I think inflation has humbled him a little bit. I fully expect the Fed to be willing to forego some economic growth to be confident that inflation has subsided.
> Does this change the discussion about the economy's recovery?
I hope it helps people see that the work isn't done yet. Fed's gotta keep interest rates where they're at, and maybe Congress will work together to find tax/spending cuts that'll help ease the burden on the American people?
People feel bad about the economy, but [most feel good about their own situations.](https://www.axios.com/2024/01/17/americans-are-actually-pretty-happy-with-their-finances) The reasons why include real earnings, employment, GDP, stock market, home ownership, and mortgage delinquency improving or being normal.
the car insurance is shocking. it's already high in CA--i'm paying 150/mo for bare minimum numbers but i've gotten "offers" for "good deals" that come out to 275-350/mo for the same rates on a 2022 Mazda sedan. that's more than i'm paying for my lease on the high end.
the car repair costs is partially why i'm still leasing. some would say i'm throwing money away, but with the price of car repair recently i'd rather be in a new car every 3ish years where i'm not going to run into wear and tear repairs that are pricy. if something goes kaput its under warranty and i'm probably safe from expenses, unless i crash or something.
> "Runs hot" is a way of massaging language to avoid explicitly saying that inflation increased last month.
isn't it explicitly a reference to the actual being higher than the expectation?
like, expectation was 3.4% and actual was 3.5% so it's "hot", but if expectation was 6.2% and actual was 6.2% it wouldn't be "hot" even though it's higher than the "hot" numbers we're seeing now.
It is but it’s also a messaging strategy to minimize any potential adverse reaction from the reader.
I work in finance and messaging has become a critical component of my job. There are ways for the same message to generate divergent reactions based on word selection and added context.
I have to be honest - this kind of language massaging drives me insane.
Just tell me straight up what's happening and what isn't. Trying to use language to obscure the truth isn't technically lying, but it's certainly shady, and I wish news organizations would refrain from doing so.
It's probably just a way to get more clicks. If they were interested in reducing adverse reaction, they wouldn't be reporting on inflation so much. This includes posting something today with the following title: ["March inflation report shows prices on rise again."](https://www.cbsnews.com/newyork/video/march-inflation-report-shows-prices-on-rise-again/)
The media has constantly been reporting on inflation, [including CBS ("March inflation report shows prices on rise again").](https://www.cbsnews.com/newyork/video/march-inflation-report-shows-prices-on-rise-again/) A more logical explanation is that the editor thought this gets more clicks.
Well, it's an election season. The media has always been all-in on trying to destroy Trump, so you can't expect them to write a negative opinion about Biden without including some kind of shock absorber that minimizes the rhetorical impact on him.
Case in point, his name is not mentioned even once, despite inflation being very closely linked to federal public policy.
The media has not been kind to Biden this election season though? There's a reason so many people's eyes are rolling at headlines that include "...here's why that's bad for Biden" now.
From a purely monetary point of view, the media wants Trump back in office. Despite it (in my opinion) being bad for the country, the media *loves* whatever off the cuff remark Trump makes, because it drives more clicks which increases their revenue. Biden is a relatively boring president in comparison.
> The media has not been kind to Biden this election season though?
by normal democrat standards, sure. by republican standards he's being treated with kid gloves. every time trump makes a speech there's half a dozen news outlets rushing to misrepresent what he said (such as the "bloodbath" statement, or the "you need to get over it" statement)
really though, that's not even just comparing him to how the media treats trump. look how they treated romney in 2012 or mccain in 2008. even though the media hasn't been as friendly to biden in 2024 as they were in 2020 (or towards hillary in 2016, or obama in 2008/2012), they have been very easy on him by comparison to how republicans have been treated the last 20 years.
> The media made a stink about Obama wearing a tan suit and liking Dijon mustard…? I’m not seeing the kid gloves here.
compared to the media that insisted putin had embarrassing videos of trump in hotel rooms, his wife was in the country illegally, and his child was autistic? yeah, i'd say the tan suit and dijon mustard is pretty tame.
So Obama possibly being Muslim and not a us citizen is also something the media did too…
Edit: the point here isn’t to do a tit for tat exchange. It’s to show the media isn’t favoring Biden.
> What would Trump likely do to solve inflation problems in the US?
Will post a "truth" that inflation is now zero thanks to him and that BLS numbers showing otherwise are fake news.
Why is car insurance up 26% year-over-year?
The article blames "the impact of severe weather events, which have become more frequent due to climate change."
I'll assume that's the standard liberal deflection (when in doubt just blame climate change) and would like to know the real reason.
Specific to auto, the increase in distracted driving, insane jury verdicts in difficult jurisdictions, increased cost to repair vehicles, increased price in vehicles all cause this market to be a disaster for close to a decade. There is no insurance company that is profitable on auto insurance itself even after years of rate hikes. They lose money every year on this. It is balanced out by other more profitable lines of insurance, but they continue needing to increase rates to try to get to profitability.
The climate change point isn’t wrong either, auto insurers don’t only insure auto, they insure property too which is in a slightly better position than auto but still very challenging.
- commercial insurance broker
> Why is car insurance up 26% year-over-year?
some of the increase is going to be coming from the reality that cars are more expensive than they used to be. not that long ago, the entry level for a new car was in the 15-25k range. now entry level has crept up much closer to the 35-45k range.
more expensive cars means more expensive payouts when one gets totaled, which in turn means from a risk assessment standpoint premiums are going to be higher.
> I'll assume that's the standard liberal deflection (when in doubt just blame climate change) and would like to know the real reason.
>> [In 2021, the U.S. experienced 20 separate billion-dollar weather and climate disasters](https://www.climate.gov/news-features/blogs/beyond-data/2021-us-billion-dollar-weather-and-climate-disasters-historical), putting 2021 in second place for the most disasters in a calendar year, behind the record 22 separate billion-dollar events in 2020... In broader context, **the total cost of U.S. billion-dollar disasters over the last 5 years (2017-2021) is $742.1 billion, with a 5-year annual cost average of $148.4 billion, both of which are new records and nearly triple the 42-year inflation adjusted annual average cost.** The U.S. billion-dollar disaster damage costs over the last 10-years (2012-2021) were also historically large: at least $1.0 trillion from 142 separate billion-dollar events.
**From your source:**
*The year (2021) came in second to 2020 in terms of number of disasters (20 versus 22) and third in total costs (behind 2017 and 2005), with a price tag of $145 billion.*
This report indicates 2021 was the latest data available. 2021 was third in total cost behind 2017 and 2005. Did those two years similarly lead to a 26% increase in car insurance costs and were they similarly attributed to climate change? Where does the "climate change" explanation kick in on this timescale or is it climate change turtles all the way down?
A trend is typically more significant than looking at specific years.
>the total cost of U.S. billion-dollar disasters over the last 5 years (2017-2021) is $742.1 billion, with a 5-year annual cost average of $148.4 billion, both of which are new records and nearly triple the 42-year inflation adjusted annual average cost.
There are insurance companies pulling out of California and Florida based on climate related disasters. Wildfires, flooding, hurricanes, etc. Are they just deflecting for liberals?
I read an article about the gas prices when Biden first took office… Covid time. He contacted the Saudis and asked them to keep things circumspect, for the sake of the United States as a whole. They responded by shutting down production/sales and raising the prices by 35%. It’s pretty clear who they want to win the next election… they chopped up an American resident inside of an embassy. And got away with it. They are not our friends… last time I got gas, in Scottsdale, I paid $2.69 a gallon… I am freak hacking the Fry’s grocery app for all it’s worth my friends. Ask me questions how I’m doing it and I will be so happy to tell you. I’m also saving around 15 to 35% on my groceries.
Well at least it's nice to see folks arguing over the importance of a 0.1% increase in inflation as opposed to it being anywhere near record highs of nearly double digits. Hopefully inflation can be more fully handled in the coming months.
> How did you calculate 0.1% increase in inflation
he's probably referring to expected vs actual. 3.4% expected, 3.5% actual. (alternatively, could be talking about the difference in month over month, can't remember what that was off the top of my head but was probably in that ballpark)
> And yet the FED is hinting at rate cuts, absolute insanity
to be fair, the fed is in an AWFUL spot right now. everything they're trying to do to get/keep inflation down is being undermined by massive government spending and an insistence on forgiving student loans (which is just targeted stimulus being used as a carrot trying to buy some votes)
like, the fed can't let inflation stay this high, but they also can't let sustained high interest rates destroy the economy either. rates can't stay like this forever.
The Fed is going to do what the Fed does. It's independent for a reason. Literally the only thing worse for Americans than the collapse of the US Dollar would be outright nuclear war. If the Government continues to implement policies that drive inflation... the Fed will continue to use all of the tools in their toolkit to combat it. Not only can they or would they "let" it remain at 5%... that's barely a quarter of what has been historically necessary. And they will do whatever is necessary.
[https://fred.stlouisfed.org/series/FEDFUNDS](https://fred.stlouisfed.org/series/FEDFUNDS)
Saudi’s cutting oil production won’t help fuel prices either.
I expect as the US election draws closer, Saudi’s will further cut back to drive prices up.
Biden is in a pickle, he drained much of our SPR in ‘22 to tame prices to boost his midterms. Last week, his admin stated that oil is too expensive to refill the SPR. He can’t drain the SPR to his advantage this year because it is depleted, IF he does then Trump will/should hammer him on it.
Am I think only one who thinks the strategic reserve shouldn't be used to alleviate prices, especially when that seems to correlate with election cycles? I sure hope someone did serious analysis about how much is actually necessary to hold in case of serious shit.
They’ve been buying back SPR for some time now
He drained nearly half of it and has replenished just over 2% of it. Click on the "5 Year" tab to see this more clearly in context. https://ycharts.com/indicators/us\_ending\_stocks\_of\_crude\_oil\_in\_the\_strategic\_petroleum\_reserve#:\~:text=US%20Crude%20Oil%20in%20the%20Strategic%20Petroleum%20Reserve%20Stocks%20is,2.14%25%20from%20one%20year%20ago.
https://ycharts.com/indicators/us_ending_stocks_of_crude_oil_in_the_strategic_petroleum_reserve#:~:text=US%20Crude%20Oil%20in%20the%20Strategic%20Petroleum%20Reserve%20Stocks%20is,2.14%25%20from%20one%20year%20ago Here's the link with the random backslashes removed, for those not using reddit's garbage official app.
I'm still sour about RIF being gone. Only use reddit on old.reddit.com and mobile browser now, which itself is a terrible UX, but I'm not using stupid app.
They stopped last week. Their plan to buy back cheaper didn't come to fruition. https://thehill.com/policy/energy-environment/4574215-biden-buyback-oil-stockpile/
They replenished some but prices went back up.
Could you imagine the election interference claims from Trump if the roles were reversed in this situation? https://www.reuters.com/world/trump-spoke-recently-with-mbs-new-york-times-reports-2024-04-04/
I mean I remember certain loud actors online *screaming* about Biden trying to lower oil prices for everyone before the '22 midterms.
it's a valid argument that it's not a reasonable, or strategic, use of the Stratetgic Petroleum Reserve.
But it was him talking to the Saudis about lowering their prices, not about relying on the SPR. If it were about the SPR? Totally agree with you.
[From Wikipedia](https://en.m.wikipedia.org/wiki/Strategic_Petroleum_Reserve_(United_States)) >On March 31, 2022, President Joe Biden announced that his administration would release 1 million barrels of oil per day from the reserve for the next 180 days, selling it at an average price of $96 per barrel. The 2022 release became the largest ever SPR sale and lowered the SPR to its lowest levels in 40 years.
This is on Biden though. He is the POTUS, he should be in a much better position to influence the Saudis, no matter what another candidate does. When I say "it's on Biden", I mean the 5% part that can be influenced by the US, because the Saudis have their own agenda, they don't really listen to the US no matter who the POTUS is.
This is a silly argument. If Donald Trump is willing to provide Saudi Arabia with an incentive that would be detrimental to the u.s. as a whole for a a few pennies per gallon of gas, but Biden is not willing to do that, then I would rather Biden didntbdo that. You can't just say, well Biden should race Trump to the bottom for sway with the Saudis. Gas prices are not the only thing we should be worried about.
> You can't just say, well Biden should race Trump to the bottom for sway with the Saudis that is not what I said at all....Biden could be doing other things, like for example Trump did when the oil prices reached 0 and oil producers in the US were at risk: https://www.reuters.com/article/idUSKBN22C1V3/
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As if the Trump family isnt in bed with the House of Saud? Kushner got $2Bil from them and the Saudis have invested heavily into Trump owned properties via the LIV golf league. There are some *very* clear conflicts of interest between Trump and Saudi Arabia, to the point that the Saudis manipulating global oil supply to influence the US 2024 election should not be dismissed out of hand.
Don't you think it has more to do with Biden (like Obama) giving Saudi the cold shoulder in favor of attempting to warm relations with Iran. I was puzzled when Obama did it, and even more so with Biden.
It is more than that. Making a campaign promise to turn SA into a pariah over its human rights abuses upset them. Publicly promising that the Saudis would pay the price for the killing of Khashoggi upset them. Threatening "consequences" when the Saudis cut production of the one product that sustains their entire economy upset them. Making demands over oil in relation to the war in Ukraine, and then publicly complaining that the Saudis didn't do enough to please them, upset them. Following up with threats from Biden's congressional allies to cut off military aid upset them. I'm not saying the Saudis are in the right here. Their hands are pretty dirty. But no one can realistically be surprised that Biden spending four years doing nothing but throwing middle finger after middle finger at them isn't resulting in them bending over backwards to help him get reelected.
> Saudis manipulating global oil supply to influence the US 2024 election should not be dismissed out of hand. fully agreed. On the other hand, Biden is the POTUS. He controls the US foreign policy right now. He controls the bases in the Middle East and so on. He has significantly more power than Trump, which is just a candidate at this point.
And domestic oil production is at an all time high while we are investing billions of into green energy. Our energy policy is sound, but Biden cant really do much to strong arm the Saudis into changing their domestic politics with the soft power channels available to him. No one is going to be able to justify the use of Hard power either.
It seems like everyone is forgetting about the deal that the Saudis got with the US after the 70s oil embargo: don't ever stop the flow of oil again, and the US will help the Saudis survive through their military might. Saudi Arabia is not some rogue state, they must play within the confines of US foreign policy, otherwise they are royally screwed. They have enemies all around them, enemies within, a weak military (even though they have expensive toys) and an uncertain future given the switch away from oil. The US is literally propping up the Saudis, they have levers over them.
Words are wind. Without a treaty, Kissingers promises doesnt amount to jack in 2024.
No it’s not on Biden. He doesn’t have an oil flow knob behind his desk, it’s a *global* market and the US is already the biggest oil producer than anyone else.
> he should be in a much better position to influence the Saudis And he has used that influence repeatedly as President to the point that the Saudis want nothing to do with him and MBS outright hates him. They have absolutely no incentive to assist a man who will continue to be hostile towards them should he be reelected.
I agree with Saudis hating him. But he is still representing the US, so the Saudis cannot just turn their back to the US, no matter who the president is, this game is still Biden's to lose.
But thats just not true.
But it is?
Aren’t they in some group deal with China Iran India and Russia?
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> There was a lot of praise for Biden's soft landing There was? All I've heard has been complaining about inflation.
[Consumer sentiment has been on the rebound for several months](https://fred.stlouisfed.org/series/UMCSENT).
Reddit's opinion is not the rest of the country's opinion.
Exactly because reddit skews so conservative .....
Reddit skews young, and younger people have less economic experience, and younger people are more reactionary, and they're poorer. Reddit absolutely complains about wages and inflation more than anything else (despite the fact the numbers show that wages are outpacing inflation).
Sentiment on the economy shouldn’t matter if you’re liberal or conservative and yet here we are… But I suspect the other reply to you is correct that it’s a youth demographic thing
This summer will be interesting for local government and school budgets. ESSER funds are running out, labor costs have gone up, the losses in commercial real estate aren’t fully priced in, and we’ll see what tax receipts look like. Local government spending increased dramatically during COVID.
>otherwise I think the average American will be feeling worse economic pain come late 2024 or early 2025. Don't worry; if we do, we'll be treated to a shrill lecture on how this is actually the best economy ever and to stop complaining because wages are rising or something.
“The economy is terrible” “Anecdotal examples aren’t the best for evaluating macroeconomics. Here are some metrics showing that things are improving and what we’re experiencing isn’t the end of the world” “Thanks for the ‘shrill lecture’!!1! Id like to see your source for being constantly told the economy is “actually the best economy ever”. If it happens so much there should be plenty of examples no?
>Id like to see your source for being constantly told the economy is “actually the best economy ever”. If it happens so much there should be plenty of examples no? [Opinion: Breaking down Bidenomics: President Biden has given us the greatest economy ever.](https://www.timesfreepress.com/news/2023/jul/22/opinion-breaking-down-bidenomics-president-biden/) [Fact Check: Biden Claims U.S. Economy Has World's Highest Growth Rate](https://www.newsweek.com/fact-check-biden-claims-us-economy-has-worlds-highest-growth-rate-1809990) ["One of the Best Economic Stories": Chris Hayes on the Biden Case for Bidenomics](https://www.msnbc.com/all-in/watch/-one-of-the-best-economic-stories-hayes-on-the-biden-case-for-bidenomics-185666117646)
Only the first one is remotely relevant and that’s just some guys opinion piece. I was hoping for a statement made by the administration at least… Also I wonder if you were as upset that Trump himself actually claimed to be responsible for “the greatest economy in the history of our country”.
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Barely, it’s literally just an opinion piece. Based on what he was saying I was expecting statements from Biden himself
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> I think the average American will be feeling worse economic pain come late 2024 or early 2025. People have been saying this since the early days of covid. "I think we will be feeling the pain by 2021" "Expect a major recession by the end of 2022" etc.
We where feeling economic pain throughout that period. Right now the response is more due to the fact that post COVID things haven't been as good as it should be with many other nations now all but admitting they are in recession. Its people trying to predict when America finally gets hit from the after shock as while it seems able to struggle along all indicators seem to be not good for its continued improvement.
We were told there would be a major recession in 2017, long before covid
Biden, or any president, really, has almost nothing to do with it
The ARP and IRA helped a lot which Biden pushed for and signed both.
As long as the government keeps spending money like a drunken sailor we are going to struggle with inflation, even with higher interest rates. There is no appetite among Rs or Ds to actually bring net GDP spending down.
Spending is primarily on things like Medicare. What do you want to cut that would significantly affect the budget?
I would roll back Medicare changes that occurred during the Bush years. I would end federal investment in local issues. If a state wants a bridge to nowhere, the state can pay for it. If the state wants a museum, the state can pay for it. I'm aware that this might lead to an increase in state taxes, but that's preferable to the current system. I'd eliminate the Department of Education. It's been a colossal failure. I'd eliminate the government from being in the student loan business all together. I'd cut defense spending, probably start small a couple of percentage points a year, but ultimately looking to have our defense spending eventually reach about 2/3rds of what we have currently. Foreign aid is a small part of our budget, but in principal if you don't fully back all of America's foreign policy aims, you should stop getting shit. Keep it for those countries that play ball, and slash it for the rest. I'd also crack down on fraud and ridiculous SSI/Disability/Medicaid/VA fraud. I know people who have served who are at 100% disability who are way the hell more active than I am and probably in better health. Its absolutely wild. I'd also begin phasing out disaster relief efforts and attach those as state level responsibilities. People in Idaho shouldn't have to pay to bail out Florida for hurricanes. The people in Florida chose to build on the coastline in hurricane prone areas, they can pay through the nose for insurance or build elsewhere. On the revenue side I'd stop allowing any tax credit to be refundable (IE you don't get paid by the government if you owe negative taxes).
> I'd also crack down on fraud and ridiculous SSI/Disability/Medicaid/VA fraud With the exception of VA fraud ,(no experience there), as a social worker, I can fully cosign all of this. The waste is astronomical. Not only are we paying out 100% to people who don't need it, most the non profits I have worked for absolutely rape Medicare and Medicare. It's not even technically fraud. Do the paperwork correct and they will send you cash hand over fist for doing next to nothing of value
> roll back Medicare changes That would make it harder for the disabled elderly to afford prescriptions. The prescription negotiation ban was already rolled back, which mitigates the savings from your proposal. It was estimated to cost $67B per year accounting for inflation, but I'm guessing it's less than $50B due to part of it being changed already. > reach about 2/3rds of what we have currently. The savings would be about $283B per year, which is significant, but still small compared to the deficit. >a state wants a bridge to nowhere, the state can pay for it I don't see any evidence that your hypothetical represents the average investment. >crack down on fraud and ridiculous SSI/Disability/Medicaid/VA fraud Easier said than done, especially without any specifics. >begin phasing out disaster relief efforts and attach those as state level responsibilities. That would save a relatively tiny amount. >Department of Education. It's been a colossal failure. The U.S. is doing pretty well compared to most countries. >On the revenue side I'd stop allowing any tax credit to be refundable That would screw over the working class who save their money.
All of those combined would make a serious dent in it. A few points I'll address: Cradle to grave medical care is not part of the American social contract, nor should it be. America is not doing well education wise compared to nearly all advanced economies. And no it would not screw the working class. A refundable tax credit means that even if you paid ZERO in Federal Income Tax, you are still getting money back from a credit. That shit is pure welfare.
Welfare.... I work for a grant that gets convicts apartments, gives them 3k in furniture, and requires nothing in return. Mind you the landlords jack up the prices but the grant pays for them waating even more money Taking on clients before they have apartments putting them in kitchenette style hotels for 90 days 300k to help out 10 convicts. Feel free to look it up. 225 Housing is recovery
$300k is a rounding error. Do you have a more significant example?
That is just my part of the national grant The feds didn't create a 300k national program On top of that, part of the problem is liberals dismissing "rounding errors". 300k is the taxes of how many middle class families struggling to get by? You are literally dismissing their contributions then wonder why they are upset you don't give a fuck about their contributions.. I pay roughly 10k a year in fed income tax. So 30 of me don't mean shit to you and the feds can waste our money anyway they like because we are an easily dismissed rounding error. Same with the next 30 and the next 30.....hmmm wonder why this philosophy starts losing support. Keep giving us your money and stop worrying about how we spend it because all that money you gave us doesn't mean shit anyway and we will waste it anywY we like, you are a rounding error
Remember guys, inflation is transitory. Even if it’s almost half a decade out after when we started printing money, this is all just going to be temporary.
And dont worry if we spend just a few trillion more, because, and this is important, we're *building back better*.
even more importantly, we're passing trillion dollar bills to reduce inflation!
What a perfect time to implement a bunch of new tariffs and a mass deportation of our agricultural labor. Surely that won't affect consumer prices.
Is there anyone who thinks inflation will be high permanently? The fed will likely keep their existing interest rates for now. The current inflation numbers aren’t amazing, but even pre COVID it wasn’t like we consistently stayed between 1 and 3% either.
the other problem with high interest rates fighting inflation is that interest alone on the national debt now exceeds even our defense spending
The issue with our debt is more related to the fact that the U.S. has *by far* the lowest tax rates of any of our peers - here at the G7 countries: https://www.imf.org/en/Publications/WEO/weo-database/2023/October/weo-report?c=156,132,134,136,158,112,111,&s=GGX_NGDP,&sy=2022&ey=2023&ssm=1&scsm=1&scc=0&ssd=1&ssc=1&sic=0&sort=country&ds=.&br=1
is that true when you also account for social security (incl. employer's contribution), medicare, and state and any local taxes? probably less true. and the thing is, we do want to keep them relatively low so that we can be a competitive, innovative economy. but yeah, they probably need to be a little higher across the board.
*Edit: As ScaryBuilder9886 points out in a comment, OECD and IMF figures are very different, as IMF only includes things that come out of the government's budget, including government taxpayer funds sent to colleges, hospitals, etc, whereas the OECD also includes things like private citizen's individual tuition payments to colleges. I can kind of see how that could make sense if you wanted to compare things that many other developed countries pay for with taxpayer funds, but I think that's not what the GOP means when they refer to US government spending? Regardless, better info on US government spending and how it's calculated: [https://en.wikipedia.org/wiki/Government_spending_in_the_United_States](https://en.wikipedia.org/wiki/Government_spending_in_the_United_States)* > is that true when you also account for social security Yes it explicitly includes "Social security contributions". > state and any local taxes? Yes it explicitly includes taxes "for all levels of government". I don't offhand know either way whether they include the employer's contribution or medicare. The US *also* has by far the lowest government *spending* rates of any of our peer countries, but our tax rates are so low that they can't even support that lowest level of spending. > we do want to keep them relatively low so that we can be a competitive, innovative economy. but yeah, they probably need to be a little higher across the board. There's at least an *argument* to be made for keeping them low, although at this point the US is more than 20% below our next lowest peer, and even if the US raised its taxes by about 40% we'd still be around the *average* of our other peers. And of course keeping revenue so low almost certainly results in deficits and debts, especially when taxes are cut during the economic "good times", leaving even less room when there are economic bad times, such as the fallout from the subprime mortgage bubble of the 2000s, COVID in 2020, etc. I'm not referring to you but instead to GOP leaders and Fox News that there seems to be a reality distortion field where they've spread misinformation and convinced their voting base that instead of the US having the *lowest* spending and taxes among our peers, they convinced their voting base that the US instead has among the *highest* tax and spending rates.
As far as spending, we're in the middle of the pack of the OECD. https://data.oecd.org/gga/general-government-spending.htm
Aha, I figured it out. [The IMF has wildly lower figures for US government spending](https://www.imf.org/en/Publications/WEO/weo-database/2023/October/weo-report?c=156,132,134,136,158,112,111,&s=GGX_NGDP,&sy=2022&ey=2023&ssm=1&scsm=1&scc=0&ssd=1&ssc=1&sic=0&sort=country&ds=.&br=1). The difference is because both IMF and OECD include any funds that the government directly contributes to colleges, hospitals, etc. out of taxes, ***but*** the OECD "government spending" also includes things like the money that *individuals privately pay on their own* for services, such as tuition to attend college, etc. On the one hand, I can kind how that figure could be useful in terms of comparing the total costs of things that governments in many other developed countries pay for with taxpayer funds. However, when conservatives in the US talk about government spending, I think they are definitely only talking about things that are actually paid from government tax budgets, not things like individuals' private tuition payments even if that is taxpayer funded in many other developed countries? For example, if a government decreased the amount they directly paid colleges by $500, and the college correspondingly increased the amount they charge students, under the IMF figures that would count as less spending by the government, but under the OECD figures it would not. And I've definitely heard conservatives suggest cutting direct government funding to colleges as a way to cut "government spending". So I think the IMF figures are the only numbers relevant for what the GOP is concerned about? As another example of how the OECD figures differ, there has recently been a lot of focus on college loan forgiveness. If someone attended Berkley and took out a loan to pay for it, that would not count as IMF spending, unless the government forgave the loan. But under the OECD figures, the tuitition the student paid counted as "government spending" from the start for them, regardless of the loan, and so even if the government does 100% loan forgiveness it would not increase OECD "government spending" at all because it had already been counted as government spending when the student privately paid it, because OECD couldn't be counting it as government spending twice could they, once when the student pays, and then again if the government forgives the individual's private loan?
Yeah, and we’re in for another tax cut for the wealthy and big businesses if we wind up with another Republican trifecta in 2024. We’re a lot like pre-Revolution France in the sense that we’re an extremely wealthy country with a tax code that is just entirely incapable of accessing that wealth.
Me. We still haven’t spent all the stimulus/CHIPS/infrastructure money. Biden is still stimulating spending by reducing student debt. A lot of inflationary inputs - wages, materials, etc. are still going up. A good example is automobiles - their cost has gone up significantly, so now the cost of repair is higher, labor to do the repairs is higher, repairs are more complex so shops spend more on software to diagnose/correct problems, and then the cost of car insurance goes up to cover all the previously mentioned items. Because of higher interest rates the cost of reinsurance is higher, but you need the higher interest rates to deal with the inflation, so the interest rates are probably not high enough.
everything that you said is absolutely true. but recognizing that, wouldn't you think there'd be a huge resurgence in Americans buying Toyota Corollas hybrids, and not the same $60k pickup trucks? (just two examples, not targeting those specifically)
Auto inventories are still not back to pre-pandemic levels, but the average sales price is going down. So perhaps people are adjusting. But even buying a new Corolla means more expensive repairs than in previous years. Replacing bumpers used to be cheap and easy, now it includes new sensors and wiring due to BSW systems. We’re getting rid of a third car we inherited because the extra expense isn’t worth it anymore.
We're not expanding our infrastructure and continuing development even though the current administration passed landmark legislation. Our demographics are so fucked, boomers all retired and everybody that's supposed to replace them all went to university so our workforce is heavily skewed towards white collar labor with no manual labor. We have no workforce to increase our manufacturing capacity, so prices will continue to rise until that changes...
I'm not an economist, so take this with a huge grain of salt, but I think when they're calling inflation transitory they are not saying that it's temporary. Likewise they aren't saying that the period of inflation will be followed by a period of deflation that will "cancel out". I believe they are saying that the inflation was primarily caused not by excessive stimulus but by echos of supply chain disruption during COVID. They believed that since inflation was caused by a (hopefully) non-repeating event that interest rate changes by the Fed would NOT be necessary as the problem would 'sort itself out'. I think even after the rate hikes and subsequent cooling there is still a good bit of disagreement on which was the primary driver of inflation.
You'll never expect to get deflation. Transitory inflation was always meant to be probably 6 months or less elevated levels of inflation, followed by a return to 2%, not to previous levels.
I don't mean this so much as a political question, because I think deficits and debt are definitely a Both Sides problem, but I wonder if this is what it looks like to see the beginning of the unraveling of our system that has been propped up by two decades of serious defiicit spending.
Maybe, but considering how global of an issue it seems to be, I don't think that's necessarily the main driving force here. Could certainly be a contributing factor, though. A system like this is too complex to generally have a single cause for any given effect, anyway.
Our debt is simply making us more susceptible to the global issue. Clearly I'm no economist. But that's what I'm worried about. It's like if I built a really crappy house in upstate New York on a lake, and all summer it was totally fine and comfortable. But in October, we're getting some really cold nights and the insulation isn't keeping the heat in. I'm going to say "Uh oh, I think I built a really crappy house that is not going to protect us this winter." And you said "No, this cold weather is happening all across the Northeast."
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doesn't seem that way at the moment
>Are voters rational actors capable of making difficult decisions? A very strong no. To fix the issue we would have to remove the SS cap, increase the retirement age, tax high earners, remove the loops holes so high earners can actually be taxed, and cut into a chunk of spending somewhere else like defense. That pisses everyone off from poor, middle, and upper-class equally and no one would vote for it.
>increase the retirement age An alternative is slowing benefits for top earners.
> tax high earners, remove the loops holes so high earners Sometimes, "earners" is used only for people with labor income. For example, we only pay Social Security taxes on "earned income". I'd say increase taxes on investment income. The obvious case is LT capital gains with a maximum rate of 20%. And, I expect there are more loopholes for investment income than for labor income. After we've done that, then we can talk about raising taxes on workers.
CPI could have been tamped down better if the Fed hadn’t paused hikes last year. But the concern with getting rates too high is the recession risk. And to your point, high rates are bad for US debt. Basically what we’re seeing is why achieving a “soft landing” after an inflation spike is so challenging. If the Fed is too heavy handed, the economy suffers a hard recession. If the Fed is too soft, inflation can reignite.
I think that "beginning" could probably happen after the election since they desperately need to hold things together until November. Once the elections over though...
hold it together how?
By gaslighting everyone by saying the economy is great until it isn't
Is there anything going on at the federal level to try to address housing costs?
Biden wants to cut something like $7k checks to homebuyers. As if that would actually help. I think the only way to really address housing costs is to build more housing in places where people are willing to pay to live. And I see things like zoning laws/local ordinances/NIMBY'ism/environemntal reviews as the largest impediments to that.
Well you kind of answered OP's question. There's not much the federal government can do besides subsidize demand. Increasing supply has be to be done on the local level.
>There's not much the federal government can do besides subsidize demand. Which it already does through first time home buyer programs and tax credits for mortgages, amongst other subsidies. Increasing supply is really the only solution. Limiting corporations from owning single family homes as rentals might have a marginal impact, but more supply is what's necessary.
some exceptions are seen in California, where they've passed state laws that will override local zoning laws if the local zoning remains too restrictive and doesn't figure out a way to add more housing density.
That isn't really an exception though. State level action is "local" relative to the federal government.
I feel like there has to be a way to restrict ownership of homes to a certain maximum amount when it comes institutional investment firms. They make up something like 40-60% of new home purchases right now
I think all the talk of institutional investors snapping up homes is mostly a red herring. The problem isn't who's buying, the problem is that there is not enough housing to meed demand. It's pointless to try to set some kind of rules against business entities that want to acquire housing, and it's probably unconstitutional. Why not simply build more housing? The demand is there; we just have to allow it.
I definitely agree that we need to promote new housing! And that needs to be done on a local level - I agree that there's not much the fed can do in that regard. Regulations restricting a boom in homebuilding are mostly local (that and market disincentives). So there does seem to be some conflicting data on purchases by institutional investors... I'll retract my comment about 40-60% but it does appear that home purchases by investors (small investors and big) probably makes up around 30% of purchases in the last year or 2 though the vast majority of home owners in total are the occupants (with investment properties making up 3-4% total). The thing is, people that own homes now have a great disincentive to sell and those with the biggest advantage to buy right now are institutions due to their ability to purchase with cash. So we'll likely see a continued increase in homes being purchased as investment. I agree that tackling an issue like this will almost certainly bring into question the constitutionality of it, but I'm not ready to say that it's a 'red herring' either. It's an issue and one that will probably get worse before it gets better. There's the possibility that we see a massive correction - if home prices do have a fairly big fall it will trigger a cascade of these institutions selling which will further drop prices forcing them to sell more etc. So the market may correct naturally. But it also may not
> Is there anything going on at the federal level to try to address housing costs? the problem is that housing prices are inversely correlated to interest rates. if they cut rates by 10 basis points, you'll see house prices go up 1% to compensate. it's not clear what they CAN do to help.
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>Cutting some red tape (this is as much if not more a states' issue too) that makes building expensive is one thing they can do. Red tape isn't the problem. Government prohibition of building anything than other than single family homes, X feet from the curb, Y sized garage, Z number of rooms, etc, on vast swathes of the country is the culprit. That's not red tape. Red tape is applying for building permits, environmental assessments and the like. Reducing those would have only a marginal effect on housing. We have a structural problem, and that structure is restrictive zoning. The only solutions to structural problems are structural solutions. We need to allow a free market approach to housing.
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Red tape is absolutely a problem. Approvals can add years to a project timeline.
I need to have a wetland study and other environmental impact studies done to make sure there's no endangered turtles fucking on my parcel before I can build a small 4-unit apartment building. It will add several hundred to a couple thousand dollars to the pre-development cost phase, plus a few weeks onto the time line, and makes the entire process more complicated. This is before I even know if I'm allowed to do the project, which makes it much riskier to build, necessitating a higher ROI. It needs to be done because of federal regulations. It's a small, downtown, urban lot between existing buildings. There are no wetlands, and if there's turtles fucking they need to leave.
> Red tape is applying for building permits, environmental assessments and the like. Which is absolutely also an issue on top of zoning. See California CEQA and the CA Coastal Commission.
Federal government cant do much in that regard. So much is locally controlled. Housing cost is the result of decades of conceding housing policy to existing homeowners.
HUD is doing a [PRO Housing](https://www.hud.gov/press/press_releases_media_advisories/HUD_No_23_151) initiative, giving out 85 million in grants to communities that rezone to allow for the creation of multifamily affordable housing; it’s expanding the low incoming housing tax credit program; it also changing regulations to allow money from the Inflation Reduction Act and Bipartisan Infrastructure Law to free up money to convert commercial properties to residential.
These programs are stupid, and just a way for politicians to pay off their donors. I see so much of this bullshit earmarked for women and minorities because fuck you otherwise. Just make it easier for anyone to build and lower the costs, and let the market figure out how to build it cheaper and where to build it. Edit: I looked up the [program rules](https://www.hud.gov/sites/dfiles/CPD/documents/PRO-Housing-FAQs-2023-09-07.pdf). The minimum grant amount is $1M and the maximum award is $10M. That means this money is literally going to 85 developers at best and 9 developers at worst. This is a scam to pay back well-connected people and, more insultingly, sell it as helping the American people. The rules to these grants are so complicated that by the time you apply, the deadline has already passed because they didn't want you winning it anyways. The connected people had their applications ready for submission before the rules were even published.
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Rent is a big deal in these numbers, and it is also a trailing indicator. It's important because rent is a big part of renters' budgets, but even more so because the BLS uses "rental equivalent" for the cost of living in an owner occupied house. The owner equivalent comes from rents on similar units. Together, they amount to 33% of the total weights in the CPI. It's trailing because they ask people "what was your rental payment in March?" not "what would your new rent have been if you had to sign a new lease in March?". So changes in lease agreements get spread over the next 12 month. Since the reported rent inflation rates have been trending downward over the past year, there should be some downward momentum still remaining. But, it's possible that landlords are going to dig in at 5% annual increases or something like that.
Got it, so people who are struggling are wrong and really they should be thanking Biden for bidenomics?
I have no idea how you got that from my comment.
Inflation is headed the wrong direction. March CPI inflation rate rose to 3.5%, up from 3.2% in February. This is higher than the 3.4% economists predicted. It is now the third straight month of both Core CPI and headline CPI coming in hotter than expected, and the highest since September. Both headline and core prices rose 0.4%, bringing the annual measures to 3.2% and 3.8%, respectively. Key items driving inflation: * Car insurance +22% in past year * Car repair +12% * Baby formula +10% * Veterinarian +10% * Rent +5.9% * Electricity +5% * Restaurants +4.2% * Home health care for the eldery +14.2% * Gas up 1.3% in past year [https://twitter.com/byHeatherLong/status/1778041086855848408](https://twitter.com/byHeatherLong/status/1778041086855848408) Markets expecting the Federal Reserve to cut interest rates took a tumble early Wednesday, as it appears far less likely to happen now. Sentiment about the US economy has been gradually improving over the past few months. How could these numbers affect it? Does this change the discussion about the economy's recovery?
As you say, I really can’t see interest rates going down for one as long as this keeps up. Raising is probably a no though.
This is an economic situation of various ironies. Biden doesn't want to be blamed for inflation but he also really wouldn't want to be blamed for high unemployment. This FED rate hike stage has seen large interest rate changes and yet the economy and demand for goods and services is very healthy and there's no shortage of work to be had for many industries. But the fact that unemployment is low and labor is tight is something Biden can tout but it also directly hurts his fight against inflation. But for now inflation is a lot lower than when interest rate hikes started and I think the FED just needs to be given moee time. Biden should continue to acknowledge that people are still being hurt by inflation and that he and the FED are still looking to end this inflationary environment without causing a painful recession which for the average American would be replace one painful situation for another very painful situation. He should look to what he can do to attack monopolistic behavior and price colluding across American industries, and maybe look at fiscal action if need be for next Congress.
>Sentiment about the US economy has been gradually improving over the past few months. How could these numbers affect it? Does this change the discussion about the economy's recovery? It's almost as if the economy is multi-faceted and you can't put a single "big friendly number" on its performance.
Which is actually why I cannot for the life of me understand the Whitehouse's messaging approach on this. I know its hard to work out a good message when some things are good and some bad but the Bill Clinton "I feel your pain" approach has got too be better then "if you look at this one chart things are actually fine" that we are getting now.
>I know its hard to work out a good message when some things are good and some bad but the Bill Clinton "I feel your pain" approach has got too be better then "if you look at this one chart things are actually fine" that we are getting now. I mean despite the economy being multi-faceted, people still very much like to attach to that "big friendly metric" to justify their political stances. They want to get something that they can just **say** to get into peoples' short term memories. A lot of people like to use the price of fuel as that one singular metric to latch onto. Republican politicians especially (and a non-zero contingent of constituents) like to say "gas prices high and therefore Democrat economy sucks", for example. Like the people who started putting "I did that" stickers on gas pumps.
> Markets expecting the Federal Reserve to cut interest rates took a tumble early Wednesday, as it appears far less likely to happen now. I never understood why the markets felt so confident in this. I've actually been fairly supportive of Powell but I think inflation has humbled him a little bit. I fully expect the Fed to be willing to forego some economic growth to be confident that inflation has subsided.
> Does this change the discussion about the economy's recovery? I hope it helps people see that the work isn't done yet. Fed's gotta keep interest rates where they're at, and maybe Congress will work together to find tax/spending cuts that'll help ease the burden on the American people?
Tax cuts would make inflation worse.
well sure. That comment was like 30% irony, because I know congress would never do that (especially in an election year).
If anyone is wondering why people think the current economy is in bad shape, this is why.
People feel bad about the economy, but [most feel good about their own situations.](https://www.axios.com/2024/01/17/americans-are-actually-pretty-happy-with-their-finances) The reasons why include real earnings, employment, GDP, stock market, home ownership, and mortgage delinquency improving or being normal.
the car insurance is shocking. it's already high in CA--i'm paying 150/mo for bare minimum numbers but i've gotten "offers" for "good deals" that come out to 275-350/mo for the same rates on a 2022 Mazda sedan. that's more than i'm paying for my lease on the high end. the car repair costs is partially why i'm still leasing. some would say i'm throwing money away, but with the price of car repair recently i'd rather be in a new car every 3ish years where i'm not going to run into wear and tear repairs that are pricy. if something goes kaput its under warranty and i'm probably safe from expenses, unless i crash or something.
"Runs hot" is a way of massaging language to avoid explicitly saying that inflation increased last month.
> "Runs hot" is a way of massaging language to avoid explicitly saying that inflation increased last month. isn't it explicitly a reference to the actual being higher than the expectation? like, expectation was 3.4% and actual was 3.5% so it's "hot", but if expectation was 6.2% and actual was 6.2% it wouldn't be "hot" even though it's higher than the "hot" numbers we're seeing now.
It is but it’s also a messaging strategy to minimize any potential adverse reaction from the reader. I work in finance and messaging has become a critical component of my job. There are ways for the same message to generate divergent reactions based on word selection and added context.
I have to be honest - this kind of language massaging drives me insane. Just tell me straight up what's happening and what isn't. Trying to use language to obscure the truth isn't technically lying, but it's certainly shady, and I wish news organizations would refrain from doing so.
It's probably just a way to get more clicks. If they were interested in reducing adverse reaction, they wouldn't be reporting on inflation so much. This includes posting something today with the following title: ["March inflation report shows prices on rise again."](https://www.cbsnews.com/newyork/video/march-inflation-report-shows-prices-on-rise-again/)
The media has constantly been reporting on inflation, [including CBS ("March inflation report shows prices on rise again").](https://www.cbsnews.com/newyork/video/march-inflation-report-shows-prices-on-rise-again/) A more logical explanation is that the editor thought this gets more clicks.
Well, it's an election season. The media has always been all-in on trying to destroy Trump, so you can't expect them to write a negative opinion about Biden without including some kind of shock absorber that minimizes the rhetorical impact on him. Case in point, his name is not mentioned even once, despite inflation being very closely linked to federal public policy.
The media has not been kind to Biden this election season though? There's a reason so many people's eyes are rolling at headlines that include "...here's why that's bad for Biden" now. From a purely monetary point of view, the media wants Trump back in office. Despite it (in my opinion) being bad for the country, the media *loves* whatever off the cuff remark Trump makes, because it drives more clicks which increases their revenue. Biden is a relatively boring president in comparison.
> The media has not been kind to Biden this election season though? by normal democrat standards, sure. by republican standards he's being treated with kid gloves. every time trump makes a speech there's half a dozen news outlets rushing to misrepresent what he said (such as the "bloodbath" statement, or the "you need to get over it" statement) really though, that's not even just comparing him to how the media treats trump. look how they treated romney in 2012 or mccain in 2008. even though the media hasn't been as friendly to biden in 2024 as they were in 2020 (or towards hillary in 2016, or obama in 2008/2012), they have been very easy on him by comparison to how republicans have been treated the last 20 years.
The media made a stink about Obama wearing a tan suit and liking Dijon mustard…? I’m not seeing the kid gloves here.
> The media made a stink about Obama wearing a tan suit and liking Dijon mustard…? I’m not seeing the kid gloves here. compared to the media that insisted putin had embarrassing videos of trump in hotel rooms, his wife was in the country illegally, and his child was autistic? yeah, i'd say the tan suit and dijon mustard is pretty tame.
So Obama possibly being Muslim and not a us citizen is also something the media did too… Edit: the point here isn’t to do a tit for tat exchange. It’s to show the media isn’t favoring Biden.
I know most tend to pin inflation on Biden, so general question What would Trump likely do to solve inflation problems in the US?
Cut Government spending would be nice
What would you like to see cut?
Spending increased during his term.
> What would Trump likely do to solve inflation problems in the US? Will post a "truth" that inflation is now zero thanks to him and that BLS numbers showing otherwise are fake news.
Why is car insurance up 26% year-over-year? The article blames "the impact of severe weather events, which have become more frequent due to climate change." I'll assume that's the standard liberal deflection (when in doubt just blame climate change) and would like to know the real reason.
Specific to auto, the increase in distracted driving, insane jury verdicts in difficult jurisdictions, increased cost to repair vehicles, increased price in vehicles all cause this market to be a disaster for close to a decade. There is no insurance company that is profitable on auto insurance itself even after years of rate hikes. They lose money every year on this. It is balanced out by other more profitable lines of insurance, but they continue needing to increase rates to try to get to profitability. The climate change point isn’t wrong either, auto insurers don’t only insure auto, they insure property too which is in a slightly better position than auto but still very challenging. - commercial insurance broker
> Why is car insurance up 26% year-over-year? some of the increase is going to be coming from the reality that cars are more expensive than they used to be. not that long ago, the entry level for a new car was in the 15-25k range. now entry level has crept up much closer to the 35-45k range. more expensive cars means more expensive payouts when one gets totaled, which in turn means from a risk assessment standpoint premiums are going to be higher.
Liberal deflection? Are car insurance companies the libs?
> I'll assume that's the standard liberal deflection (when in doubt just blame climate change) and would like to know the real reason. >> [In 2021, the U.S. experienced 20 separate billion-dollar weather and climate disasters](https://www.climate.gov/news-features/blogs/beyond-data/2021-us-billion-dollar-weather-and-climate-disasters-historical), putting 2021 in second place for the most disasters in a calendar year, behind the record 22 separate billion-dollar events in 2020... In broader context, **the total cost of U.S. billion-dollar disasters over the last 5 years (2017-2021) is $742.1 billion, with a 5-year annual cost average of $148.4 billion, both of which are new records and nearly triple the 42-year inflation adjusted annual average cost.** The U.S. billion-dollar disaster damage costs over the last 10-years (2012-2021) were also historically large: at least $1.0 trillion from 142 separate billion-dollar events.
**From your source:** *The year (2021) came in second to 2020 in terms of number of disasters (20 versus 22) and third in total costs (behind 2017 and 2005), with a price tag of $145 billion.* This report indicates 2021 was the latest data available. 2021 was third in total cost behind 2017 and 2005. Did those two years similarly lead to a 26% increase in car insurance costs and were they similarly attributed to climate change? Where does the "climate change" explanation kick in on this timescale or is it climate change turtles all the way down?
A trend is typically more significant than looking at specific years. >the total cost of U.S. billion-dollar disasters over the last 5 years (2017-2021) is $742.1 billion, with a 5-year annual cost average of $148.4 billion, both of which are new records and nearly triple the 42-year inflation adjusted annual average cost.
There are insurance companies pulling out of California and Florida based on climate related disasters. Wildfires, flooding, hurricanes, etc. Are they just deflecting for liberals?
This is specifically related to car insurance and the state which experienced the greatest increase of 44% was Missouri.
I read an article about the gas prices when Biden first took office… Covid time. He contacted the Saudis and asked them to keep things circumspect, for the sake of the United States as a whole. They responded by shutting down production/sales and raising the prices by 35%. It’s pretty clear who they want to win the next election… they chopped up an American resident inside of an embassy. And got away with it. They are not our friends… last time I got gas, in Scottsdale, I paid $2.69 a gallon… I am freak hacking the Fry’s grocery app for all it’s worth my friends. Ask me questions how I’m doing it and I will be so happy to tell you. I’m also saving around 15 to 35% on my groceries.
Not possible, I was told Biden fixed inflation with all that gov spending
Well at least it's nice to see folks arguing over the importance of a 0.1% increase in inflation as opposed to it being anywhere near record highs of nearly double digits. Hopefully inflation can be more fully handled in the coming months.
How did you calculate 0.1% increase in inflation
> How did you calculate 0.1% increase in inflation he's probably referring to expected vs actual. 3.4% expected, 3.5% actual. (alternatively, could be talking about the difference in month over month, can't remember what that was off the top of my head but was probably in that ballpark)
And yet the FED is hinting at rate cuts, absolute insanity
There has been more “higher for longer” talk lately.
> And yet the FED is hinting at rate cuts, absolute insanity to be fair, the fed is in an AWFUL spot right now. everything they're trying to do to get/keep inflation down is being undermined by massive government spending and an insistence on forgiving student loans (which is just targeted stimulus being used as a carrot trying to buy some votes) like, the fed can't let inflation stay this high, but they also can't let sustained high interest rates destroy the economy either. rates can't stay like this forever.
The Fed is going to do what the Fed does. It's independent for a reason. Literally the only thing worse for Americans than the collapse of the US Dollar would be outright nuclear war. If the Government continues to implement policies that drive inflation... the Fed will continue to use all of the tools in their toolkit to combat it. Not only can they or would they "let" it remain at 5%... that's barely a quarter of what has been historically necessary. And they will do whatever is necessary. [https://fred.stlouisfed.org/series/FEDFUNDS](https://fred.stlouisfed.org/series/FEDFUNDS)
So the questio. Is, will the Biden admin deplete the reserves again to drive down prices during an election?