Low Inflation Continues to Disappoint Inflation Hawks


Perhaps you’ve read that inflation is up recently. Last night, for example, NBC News breathlessly told me that the price of eggs had gone up 13 cents over the past year. Does this mean that the inflation worries we’ve been hearing about continuously for the past four years are finally coming true?

I’d be happy if they were, since I think higher inflation would do the economy some good. Sadly, though, inflation remains well anchored. Despite the higher numbers of the past two months, the Fed’s latest projections have increased by….one tenth of a percentage point. Or, if you take the average of their range, by one twentieth of a percentage point, from 1.55 percent to 1.6 percent.

And how about 2015? They’re projecting 1.75 percent. And 2016? A whopping 1.8 percent. In other words, they believe that we’ll continue to undershoot our inflation target for at least the next three years.

At the same time, their projection of GDP growth has plummeted from 2.9 percent to 2.2 percent. And their projections for 2015 and 2016 continue to hover around an anemic 3 percent.

So: we have low growth, low price inflation, low wage inflation, and unemployment is still high. This is really not an environment in which spending cuts and lower deficits are the answer. More here from Mark Thoma.

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SIX TRUTHS

Reclaiming power from those who abuse it often starts with telling the truth. And in "This Is How Authoritarians Get Defeated," MoJo's Monika Bauerlein unpacks six truths to remember during the homestretch of an election where democracy, truth, and decency are on the line.

Truth #1: The chaos is the point.

Truth #2: Team Reality is bigger than it seems.

Truth #3: Facebook owns this.

Truth #4: When we go to work, we're in the fight.

Truth #5: It's about minority rule.

Truth #6: The only thing that can save us is…us.

Please take a moment to see how all these truths add up, because what happens in the weeks and months ahead will reverberate for at least a generation and we better be prepared.

And if you think journalism like Mother Jones'—that calls it like it is, that will never acquiesce to power, that looks where others don't—can help guide us through this historic, high-stakes moment, and you're able to right now, please help us reach our $350,000 goal by October 31 with a donation today. It's all hands on deck for democracy.

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