Tuesday, October 27, 2015

DeLong: No Accelertaing Price Inflation in Sight

Right next to my "Paul Krugman Deflation Warning"  file, I am placing a new file, the Brad Delong "There is No Acceleration in Inflation Coming" file.

DeLong links to Nick Bunker who says:
This is entirely consistent with inflation-expectations anchored near 2%/year--or inflation so low that shifts in inflation expectations are not a thing... 
[N]ot only does the right wing of the Federal Reserve expecting an imminent upswing of inflation because of MONEY PRINTING! have it wrong, it strongly looks as though the center of the Federal Reserve has it wrong too...
My expectation is that there is a very high probability that price inflation in 2016 will climb far above 2% (as measured by government price indexes). First stop 3%, then 5%. And that's in my file!



  1. Sure, pretend the price of oil is irrelevant. Pretend Austrians are claiming there's a direct, immediate correlation between Fed money printing and prices.

    Hopefully oil will stay low, or move sideways. Otherwise they'll use that as an excuse later, claiming it's all oils fault (but only when it's price goes up!). After someone points out the inconsistency, they will pretend you don't exist.

  2. It depends on credit expansion.

  3. If you look at Alaska and the projects moving forward here, expectation is much higher oil in 2016.
    Normally these type of huge projects, ( in the hundreds of millions and low billions) die as as soon as oil even thinks about dropping.
    Not this time. At least not yet.
    BP, ConocoPhillips, and Exxon are moving forward with major projects. Not to mention the smaller companies that are spending even more relative to their size.
    At least that's what I am seeing first hand.