* Inflation and Consumer Price Index (CPI): We discuss the year-over-year change in CPI, highlighting the difference between overall inflation and inflation excluding energy and motor fuels. I noted an unusual occurrence where, if energy is included, there has been a year-over-year deflation of -0.4%. This deflation is contrasted with the public's perception of increasing prices, suggesting that the official inflation figures may not fully capture the cost of living increases felt by consumers.
* Cost of Living Concerns: The cost of living, particularly housing costs, is a significant concern. I pointed out that while certain items like oil and energy are included in inflationary numbers, the overall cost of living is not, leading to a disconnect between reported inflation and actual expenses faced by Americans.
* Food and Tobacco Price Increases: There is a specific mention of the significant rise in the cost of food and tobacco, with an almost 8-10% increase year over year. This rise is directly impacting consumers, making everyday expenses feel more burdensome.
* Commercial Real Estate Market: A challenging future for the commercial real estate market, with an impending "coming to Jesus moment" where businesses may have to shut down or return keys to the banks due to the inability to refinance or deal with occupancy drops.
* Employment and Work Trends: Data from Castle Systems is referenced, providing insights into national occupancy rates across buildings in various cities. This data serves as a "back to work barometer," indicating the level of return to physical workplaces, which has implications for commercial real estate.
* Sector-Specific Inflation Trends: The inflationary and deflationary trends within different sectors, noting that not all sectors move in tandem. For example, while the cost of non-industrial services has increased, other areas have seen price drops.
* Historical Context and Future Outlook: The discussion includes references to the 2008 housing market crash, drawing parallels and contrasts to the current economic climate. This suggests that there will be massive opportunities in the future, akin to the post-2008 recovery period.
* Psychological Impact of Economic Numbers: The psychological effects of inflation rates exceeding certain thresholds, such as 5%, and how these figures can influence public sentiment and behavior.
* Adjustments for Inflation and GDP: The problem with GDP figures when adjusted for inflation, suggesting that the apparent health of the economy on paper may not reflect the reality experienced by individuals and businesses.
The Youtube version…for charts and graphs that are referenced in the audio:
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