Photo: Former New York Mayor Michael Bloomberg, who was also formerly a candidate for U.S. President.
A few weeks ago, Wall Street was panicking. Now, the U.S. looks to be in soft-landing territory with inflation falling below a crucial threshold as the country nears the end of its battle back from the pandemic’s economic aftermath…
— from the Weekend Reading newsletter by Bloomberg News, August 17, 2024.
I recently subscribed to the Bloomberg News newsletter for a couple of reasons.
One, it was free to subscribe.
And two, I thought I should learn something about business and investing, now that I’m over 60 and looking forward to retiring. I understand that when you retire, you find yourself looking for things to do, to fill your time, and I figured making myself rich could be a reasonable way to beat back the boredom.
One thing I’ve learned already: 2.9% inflation is a crucial threshold.
But then, I wanted to know why it’s a crucial threshold.
A chart provided by Bloomberg was helpful. Assuming you like charts.
Basically, inflation has been too high — that is, higher than 2.9% — ever since Joe Biden took office. But I’m not blaming Joe Biden. He’s just an old man trying to do a difficult job. He could have retired years ago (as I am planning to do) but presumably, he was looking for things to do to fill his time.
Looking at the chart above, I get mixed messages from Bloomberg and the Bureau of Labor Statistics. The “Change in core CPI (YoY)” suggests one thing has been happening, while the “Change in core goods prices (YoY)” says something different, and the “Change in shelter costs (MoM)” is different from both of them.
Will the real Inflation Rate please stand up?
I sometimes wonder if people who report economic news — in this case, Bloomberg reporters Victoria Cavaliere and Ian Fisher — are just trying to confuse us.
Apparently, Bloomberg News is named after Michael Bloomberg, who became very rich by selling Bloomberg Terminals to businesses. These computer terminals provided instant news about the economy to people trying to get rich. (Something I might do when I retire.) The business seems to have been successful, because Michael Bloomberg was listed in the 2019 Forbes list of the world’s billionaires as the ninth-richest person. His net worth was estimated at $55.5 billion, which is more than the entire Archuleta County budget.
I suppose, if you have a net worth of $55.5 billion, a slight increase in the price of gas is not a big deal. Nevertheless, Bloomberg News tries to share upbeat news about the economy with ordinary people like you and me, especially when the inflation rate has fallen below a crucial threshold.
That threshold is actually very important, if you’re rich, because it means that the Federal Reserve now has an excuse to lower the interest rate, which means rich people can buy houses with a better mortgage rate. There was a time when even middle class families could buy homes, but those days seem to be behind us. (See the “Change in shelter costs (MoM)” chart, above.)
Michael Bloomberg ran for President in 2019, as a Democrat, and spent $676 million of his personal fortune on the primary campaign, breaking a record for the most money ever spent on a presidential primary campaign. But he couldn’t even beat old Joe Biden at the polls, and he dropped out of the race in March 2020.
Which goes to prove that money can’t buy you love.
And I’m thankful for that. Because money is worth less, with each passing day, even if we’ve finally gotten past the crucial threshold.
Love, on the other hand, is priceless.
Underrated writer Louis Cannon grew up in the vast American West, although his ex-wife, given the slightest opportunity, will deny that he ever grew up at all.