Generations of Inflation

ROBARE & JONES ON THE MARKETS

            Here’s a riddle: How can inflation be 8.5 percent and 6.5 percent at the same time? The answer is that it depends on how you measure it.  

Determining how quickly prices are rising or falling – and where they may be headed in the future – is not simple. In the United States, millions of goods and services are bought and sold every day – shelter, food, transportation, energy, water, education, childcare, equipment and tools, medical care, furnishings, apparel, trash removal, and much more.  

The government relies on two indexes: the Consumer Price index (CPI) and the Personal Consumption Expenditures Index (PCE). Each index has two versions: headline inflation and core inflation.  

Last week, the Bureau of Labor Statistics (BLS) reported that CPI headline inflation was up 8.5 percent in March, and CPI core inflation was up 6.5 percent.   The BLS does not collect every price in every part of the United States. It gathers prices in 75 cities, collecting data from about 6,000 households and 22,000 department stores, supermarkets, hospitals, gas stations, and other establishments. So, the CPI is a measurement that reflects the experience of urban consumers.  

CPI headline inflation Last week, the CPI showed that headline inflation, which includes all price changes collected, was up 1.2 percent from February to March, and up 8.5 percent for the 12-month period that ended March 31. The largest increases in the CPI were:  

• Used cars and truck prices                                                     +35.3 percent
• Energy prices(fuel oil, gasoline, natural gas, etc.)                 +32.0 percent
• New car prices                                                                        +12.5 percent
• Food prices (groceries and eating out)                                  +  8.8 percent

 The BLS also reported on core inflation, which is the CPI minus food and energy prices, and was lower than headline inflation. The core CPI was up 0.3 percent from February to March, and up 6.5 percent for the 12-month period that ended March 31. In summary headline CPI is where we've been and Core CPI is where we are going to be...   

Let's take a look at the markets from this past week!

Generation Quiz!

        In the United States, we often describe groups of people by applying generational labels – Baby Boomers, Gen X, Millennials, and so on. Researchers use these generational cohorts to better understand formative experiences, world views, aging processes, and other issues. See what you know about generational demographics by taking this brief quiz.  

1. How many generations live in the United States today? 
   1. Four (Gen Z, Millennials, Gen X, and Baby Boomers)
   2. Five (Gen Z, Millennials, Gen X, Baby Boomers, and the Silent Gen)
   3. Six (Gen Z, Millennials, Gen X, Baby Boomers, the Silent Gen, and the Greatest Gen)
   4. Seven (Gen Alpha, Gen Z, Millennials, Gen X, Baby Boomers, the Silent Gen, and the Greatest Gen)

2. When surveyed, which of the following events did Millennials, Gen X, Boomers, and Silent Generation respondents agree occurred during their lifetimes and had a powerful impact on our country? 
   1. Moon landing
   2. Civil Rights movement
   3. Berlin Wall/ End of Cold War
   4. The tech revolution

3. Which generation currently has the most economic and political power? 
   1. Gen Z
   2. Millennials
   3. Gen X
   4. Baby Boomers
   5. Silent Gen

4. Which generation owns the most small businesses? 
   1. Gen Z
   2. Millennials
   3. Gen X
   4. Baby Boomers
   5. Silent Gen

5. Which generation is the most influential on digital platforms? 
   1. Gen Z
   2. Millennials
   3. Gen X
   4. Baby Boomers
   5. Silent Gen

Want to know to the answers to the quiz? Let us know!