progree
progree's JournalJackie Little, suspected in mosque fires, vandalizing Rep. Ilhan Omar's office, arrested
The suspect who allegedly set two fires at mosques in south Minneapolis last week has been arrested and now faces a federal arson charge, according to the U.S. Attorney's Office in Minnesota.
Jackie Little, 36, was charged by warrant earlier this week in Hennepin County in connection with a fire at Masjid Al Rahma Islamic Center.
A federal complaint accuses Little of starting a fire in the bathroom at the Masjid Omar Islamic Center April 23, as well as in a hallway at Masjid Al Rahma a day later. A representative of Masjid Al Rahma told investigators the fire caused "tens of thousands of dollars" in damages, the complaint states.
Per the complaint, Little's mother told investigators he "extensively harassed a Muslim female" in the past and "has had a fascination with fire from a young age." She said she suspected him in "several unreported arson events."
Little's mother identified him in surveillance footage of the arsons. Plymouth police also recognized Little from a previous arson investigation.
More: https://www.cbsnews.com/minnesota/news/minneapolis-mosque-fires-suspect-arrested/
-The article also discusses the vandalizing of Rep. Ilhan Omar's office
-CAIR (Minnesota Council on American-Islamic Relations) has gotten enough in donations to hire a full-time professional who will work with the 92 mosques in the state to apply for grants for safety measures
-Little will make his first court appearance Monday (that's today). Pic below.
- Good news video at the link
YW 😊 Busy day economy wise: Personal Income, Personal Spending, Employment Cost Index,
Consumer Sentiment, and PCE inflation.
I'll be particularly interested in looking at the Employment Cost Index as it is said to be a much better indicator of wages and compensation than the usual go-to metric of average hourly earnings that comes out on first Fridays (usually). The ECI is said to looks at trends in the same occupations, whereas average hourly earnings gets distorted by job losses or gains occurring in certain sectors more than others; last hired first fired stuff (in the pandemic that caused the averages to soar). Whatever. I'm saying this off the top of my head, there are better explanations out there.
The downside of the ECI is that it's quarterly - meaning a long wait for updates, and then the updates have some old data in them.
The AP story I linked to has just this on today's ECI report:
That looks good because the CPI rose 0.94% in the last 3 months, and the PCE 0.98%. So that means an actual real (inflation-adjusted) increase, for a change.
http://www.bls.gov/news.release/eci.nr0.htm
Their table shows the 12 month inflation-adjusted number is -0.2%. At a glance I don't see their inflation-adjusted 3 month number anywhere.
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From: https://www.piie.com/blogs/realtime-economic-issues-watch/us-wages-grew-fastest-pace-decades-2021-prices-grew-even-more
By fixing workforce composition, the ECI provides a more accurate picture of what is actually happening to wages.
[1] The Pandemic’s Effect on Measured Wage Growth, The WHite House, 4/19/21
https://www.whitehouse.gov/cea/written-materials/2021/04/19/the-pandemics-effect-on-measured-wage-growth/
=====================================================
This particular one is inflation-adjusted wage and salaries for private sector workers.
Note the build-up to the Q2.2020 peak. Then it plateaued through Q1.2021, President Biden's first quarter, then went down.
Finally it has been turning up since a local bottom in Q3.2022 for a couple of quarters.
The last reading is 3.7% below the peak, and 3.4% below the Q1.2021 value.
Source: https://fredblog.stlouisfed.org/2018/02/are-wages-increasing-or-decreasing
I tediously moused over point by point gathering the data from their graph (the numbers for each point pop up, so I didn't have to "read" the graph like back in middle school). Edit: There's a "Download data" link at the lower left of the second graph at the Source that I had been aware of and had clicked and thought it was just downloading a PDF file of the page. But it turned out it was offering to download the Excel data for the graph which is of course what I wanted. So I did that and verified that the data was the same, to within 0.0 accuracy, as used for my graph, but I went ahead and replaced my old data with it (since it has a few more digits to the right of the decimal, and heck why not).
The source link just above also compares to inflation-adjusted average hourly earnings and also to inflation-adjusted median usual earnings of full-time workers.
This (the ECI) is reportedly the Fed's favorite wage and salary indicator as explained earlier in the post.
Inflation Graphs
The PCE Inflation report came out today, Friday 4/28/23. It was good on the overall inflation (see the red bars in the below graph), but the core PCE inflation still remains high, and has not come down much in recent months -- see the blue bars.
The Federal reserve's favorite inflation gauge for projecting FUTURE inflation has been the core PCE (which is the PCE less food and energy). It's not that food and energy are unimportant, but are quite volatile from month to month. The core measure is thought to be better for projecting trends into the future.
Below is the CORE PCE inflation trend -- the rolling 3 month average and the rolling 6 month average
The rolling 3 month average should improve quite a bit next month when the January +0.6% number falls outside the 3 month period.
*********LINKS
PCE News release: http://www.bea.gov/newsreleases/national/pi/pinewsrelease.htm
The above shows the last 5 months. I found the latest 12 months (and way beyond) at FRED:
PCE: https://fred.stlouisfed.org/series/PCEPI
CORE PCE: https://fred.stlouisfed.org/series/PCEPILFE
The rolling 3 month and 6 month figures are calculated from the index values from the above FRED series for the CORE PCE (not from doing one digit math averages).
Consumer Price Index (CPI) released April 12
For comparison purposes, here is the most recent consumer price index graph (through March, released April 12)
CPI - https://data.bls.gov/timeseries/CUSR0000SA0&output_view=pct_1mth
CORE CPI - http://data.bls.gov/timeseries/CUSR0000SA0L1E&output_view=pct_1mth
(Choose "More Formatting Options" at the upper right of the page for other views such as rolling averages of past 12 months, past 6 months, past 3 months)
Inflation measures - last 3 months annualized
. . REGULAR CORE
PCE 4.00% 4.85%
CPI 3.82% 5.11%
PPI -0.28% 3.61% (Producer Price Index, aka Wholesale Prices)
Cooling wholesale prices should ideally be reflected in the PCE and CPI in the next month or two, but seems not to be that good of a predictor.
Interestingly it says that rents carry twice the weight in the CPI as in the PCE.
This is an excellent summary not only of the PCE inflation report that came out today, but also of the Employment Cost Index and the Personal Income and Personal Consumption Expenditures (consumer spending) reports that were also released today.
Here are some excerpts from the inflation part --
The index, which excludes volatile food and energy costs to capture “core” prices, rose 0.3% from February to March and 4.6% from a year earlier — still far above the Fed’s 2% target rate. Some Fed officials are concerned that core inflation hasn’t declined much since reaching 4.7% in July.
Overall prices ticked up just 0.1% from February to March, the smallest monthly rise since last July and down from a 0.3% increase from January to February, Friday's Commerce Department report showed. Compared with a year ago, inflation slowed to just 4.2% from 5% in February, though much of that decline reflected lower gas prices. That is the lowest year-over-year overall inflation figure in nearly two years.
The Fed is thought to monitor the inflation gauge that was issued Friday, called the personal consumption expenditures (PCE) price index, even more closely than it does the government’s better-known consumer price index. Typically, the PCE index shows a lower inflation level than CPI. In part, that’s because rents, which have been among the biggest drivers of inflation, carry twice the weight in the CPI that they do in the PCE.
The PCE index showed that food prices dropped 0.2% from February to March. Gas costs plummeted 3.7%, which partly reflected seasonal changes. Prices at the pump have since increased in many states.
The latest inflation figures point to the dilemma confronting officials at the Federal Reserve: Across the economy, price increases for many goods have slowed significantly. And some previous drivers of inflation, notably clogged supply chains, have eased. Yet prices for many services, including restaurants, auto insurance and hotel rooms, are still surging, fueled by robust demand from consumers who in many cases have enjoyed rising wages.
Graph: real (inflation-adjusted) retail sales
Advance Real Retail and Food Services Sales (RRSFS) (1982-84 dollars)
https://fred.stlouisfed.org/series/RRSFS
The bottom is April 2020, the peak is March 2021. Very interesting how Covid / stimulus money pushed it way up above pre-pandemic levels to the March 2021 peak, and since then its been treading water at best, but still above the level of the pre-pandemic trend line.
====== The below are NOT adjusted for inflation: =======
Advance Retail Sales: Retail Trade and Food Services (RSAFS) (FRED) - this matches "retail sales" in media reports
https://fred.stlouisfed.org/series/RSAFS
Percent change from prior month: https://fred.stlouisfed.org/series/MARTSMPCSM44X72USS
Links to data series with graphs. Note: the *CORE* CPI is +0.4% in March
(it's a 4.7% annualized rate when calculated with the actual index values) and its rolling 3 month average is 5.1% annualized. This 3 month average was 5.2% annualized in February. So RECENT CORE inflation still seems stuck at around 5%. (Reminder: the Fed uses core measures to predict future inflation, whether we like it or not, although specifically they target the core PCE, not the core CPI https://www.democraticunderground.com/10143053501#post5 )
CPI news release: https://www.bls.gov/news.release/cpi.nr0.htm
CPI time series: https://data.bls.gov/timeseries/CUSR0000SA0
Monthly increases: https://data.bls.gov/timeseries/CUSR0000SA0&output_view=pct_1mth
CORE CPI: http://data.bls.gov/timeseries/CUSR0000SA0L1E
Monthly increases: http://data.bls.gov/timeseries/CUSR0000SA0L1E&output_view=pct_1mth
CPI excluding shelter - https://data.bls.gov/timeseries/CUUR0000SA0L2
FRED: https://fred.stlouisfed.org/series/CUUR0000SA0L2
Core CPI excluding shelter - I sure would like this time series, but apparently I haven't found one yet. It's said to be a Fed favorite.
Table 3 has CPI ex shelter, as well as Core ex shelter https://www.bls.gov/news.release/cpi.t03.htm
Rent (SA) https://data.bls.gov/timeseries/CUSR0000SEHA
Fred: (SA) Rent of Primary Residence in U.S. City Average https://fred.stlouisfed.org/series/CUSR0000SEHA
(NSA) CUUR0000SEHA
SA is seasonally adjusted. NSA is Not seasonally adjusted
Real average hourly earnings of production and non-supervisory workers
https://data.bls.gov/timeseries/CES0500000032
private workers: https://data.bls.gov/timeseries/CES0500000013
In all of the BLS ones, one can change/add 1 month, 2 month, 3 month, 6 month and 12 month rolling averages by clicking "More Formatting Options" at the top right and checking the appropriate check boxes
Yup, they sure were serious about meeting the 2% target
Below is a graph of the Federal Reserve's target interest rate and the CPI from 4/1998 to 12/2001
# CPI: https://data.bls.gov/timeseries/CUSR0000SA0
(In "More Formatting Options" at the upper right one can change/add 2 month, 3 month, 6 month, and 12 month rolling averages, as well as show the 1 month changes. All with graphs.
# Fed Funds Target Rate (until 2008) -- https://fred.stlouisfed.org/series/DFEDTAR
(Context: it spent most of late 94 to late fall 98 at above 5%),
Per the NBER, the recession began March 2001.
I suspect likewise that nowadays the Fed is serious about the 2% target, but mindful of not crashing the banks. Core PCE is well over 4% on a rolling averages basis. https://www.democraticunderground.com/10143053501#post5
I'm frankly surprised that so many think the Fed is going to let inflation sit at more than twice their target rate, and that the 2% target is just for shits and giggles.
A 3.5% inflation rate (the peak plateau level shown in the above graph) may not be red-hot, but it's enough to cut the purchasing power of the dollar in half in about 20 years, and down to a quarter in 40 years.
Graphs - latest PCE, CPI, PPI (both regular and core). And rolling 3 mo, 6 mo, 12 mo of core PCE
From the news release, http://www.bea.gov/newsreleases/national/pi/pinewsrelease.htm
From the preceding month, the PCE price index for February increased 0.3 percent (table 9). Prices for goods increased 0.2 percent and prices for services increased 0.3 percent. Food prices increased 0.2 percent and energy prices decreased 0.4 percent. Excluding food and energy, the PCE price index increased 0.3 percent. Detailed monthly PCE price indexes are presented on Table 2.4.4U
From the same month one year ago, the PCE price index for February increased 5.0 percent (table 11). Prices for goods increased 3.6 percent and prices for services increased 5.7 percent. Food prices increased 9.7 percent and energy prices increased 5.1 percent. Excluding food and energy, the PCE price index increased 4.6 percent from one year ago.
And they show the last 5 months. I found the latest 12 months (and way beyond) at FRED:
PCE: https://fred.stlouisfed.org/series/PCEPI
CORE PCE: https://fred.stlouisfed.org/series/PCEPILFE
PCE Inflation (just came out today, March 31):
What a difference a month makes. Before today's report, when the last bar was January, it looked like a rewarming of core PCE inflation. With February's 0.3% number, it looks quite a bit better, maybe roughly a flat-lining with with wiggles.
PCE, rolling 3 month averages, annualized
7.25% 7.42% 6.17% 4.75% 2.10% 4.21% 3.81% 3.22% 3.85% 4.23%
CORE PCE, rolling 3 month averages, annualized
4.30% 5.39% 4.40% 5.13% 4.45% 5.45% 4.08% 3.71% 4.56% 4.88%
Consumer Price Index (CPI)
CPI - https://data.bls.gov/timeseries/CUSR0000SA0&output_view=pct_1mth
CORE CPI - http://data.bls.gov/timeseries/CUSR0000SA0L1E&output_view=pct_1mth
(Choose "More Formatting Options" at the upper right of the page for other views such as rolling averages of past 12 months, past 6 months, past 3 months)
Updated 4/12/23 to include March:
Producer Price Index (PPI)
OLD CORE PPI - Producer Price Index, seasonally adjusted - Final demand goods less foods and energy -
http://data.bls.gov/timeseries/WPSFD413?output_view=pct_1mth
CORE PPI - Producer Price Index, seasonally adjusted - Final demand less foods. energy. and trade services - This is the core measure that the BLS features, so I will follow their lead
http://data.bls.gov/timeseries/WPSFD49116?output_view=pct_1mth
(Choose "More Formatting Options" at the upper right of the page for other views such as rolling averages of past 12 months, past 6 months, past 3 months)
Why the Fed thinks core is better for forecasting future inflation: https://www.democraticunderground.com/10143025190#post10
3 months annualized: Core CPI: 5.11%, Core PCE: 4.88%, Core PPI (wholesale prices): 3.74%
(Core CPI above updated 4/12/23 to include the March data)
I chose 3 months for its recency, but that it's still a longer period than one month, so less likely that one can dismiss it as a "one off", as some try to do when the last month is bad (and make it THE only data when the last month is good)
Back to the CORE PCE 3 months, 6 months, and 12 months rolling averages (all are annualized rates)
Looking at 3 month and 6 month rolling average, it looks like a flat-lining with wiggles for several months -- we're at the same place we were several months ago. The 12 month shows only the slightest decline.
Edited to add 405 PM ET on seeing some comments
The Fed has long targeted 2%. Did people really expect they'd just declare that the target was always there just for shits and giggles and they were content now with inflation rates more than twice as high as that, and were just going to sit on their rusty dusties and "wait" for inflation to come down when it has been essentially flat on a rolling 3 month and 6 month basis; when they made their last rate hike decision March 21, the recent trend of those had been going up). My big song and dance about what I think of using the rolling 12 month inflation to gauge RECENT or CURRENT inflation: https://www.democraticunderground.com/10143045881#post6 .
My harangue about not only was Powell renominated by President Biden, but the vast majority of Democratic senators voted for his confirmation. And that it's not just Powell, but the rest of the Federal Open Market Committee (FOMC) that is voting unaminously for rate hikes. And a reminder that last June, when inflation was 8.9%, continuing at that rate would cut the purchasing power of the dollar in half in just 8.1 years, and down to a quarter in 16.2 years. And that historically, in relatively high inflation periods, wages don't keep up with prices. And the purchasing power of savings and investments tend to be devastated (as opposed to the nominal dollar figure, which might actually look pretty good - fool's gold). https://www.democraticunderground.com/10143049684#post7
At the core PCE inflation rate of 4.88% (3 month average, annualized), the purchasing power of the dollar is halved in 14.5 years, and quartered in 29 years. That isn't OK with me.
Edited 529p ET- Stocks, Treasury yields, and more (the S&P 500 closed up 1.4%, and a scroll through the financial headlines credits the tamer-than-expected PCE inflation report. The S&P 500 has now had two positive quarters in a row, but is still 14.3% below its 1/3/22 all-time high) : https://finance.yahoo.com/
"Vegas slot machine ... a tiny 'I told you so.'"
Yes, the market periodically goes down, some times very steeply. To take the 3 steepest pullbacks since WWII: In '73-'74 we had a 48% drop from peak-to-trough, and it took 7.5 years to recover from that and reach a new high. In the Dotcom bust we had a 49% drop and a 7.2 year recovery time. In the Housing Bubble bust it fell 57% and took 5.5 year to recover.
I guarantee plunges of this depth will happen again. Crashes happen and will continue to happen. I too will join you in telling anyone who doesn't think a crash will ever happen again, "I told you so".
I don't think predicting a crash is any more insightful than predicting that some day there will be a solar eclipse. I don't know anyone who thinks a crash will never happen. Everyone knows it will happen. Personally I think stock valuations are way high and we're plenty ripe for one.
But even after a 50% or 60% plunge, I will still have a bigger nest egg as a long-time buy and hold equity investor. Why? Because after 2 or 3 doublings (meaning a 4 fold or 8 fold increase), a 50% plunge still leaves me with a 2 fold or 4 fold increase.
Nothing holds up as well in the face of withdrawals and inflation than does equities, except perhaps real estate. In other words, it's an even bigger gamble to not have a sizable proportion in equities.
Over the past 20 years, it has grown 6.37 fold, an average annual increase of 9.7%/year
(had the market crashed 60% in 2022 -- a worst crash than any of the post WWII crashes -- then it would have still grown 3.11 fold, an increase of 5.8%/year)
Over the past 50 years, it has grown 131 fold, an average annual increase of 10.2%/year
(had the market crashed 60% in 2022, then it would have still grown 64 fold, an increase of 8.7%/year)
and so on. I'd go to Vegas a lot if I could average these kinds of returns.
This is from the below link, which also has similar for bonds, Treasury bills, and gold. These don't come close to matching the increase in equities.
http://pages.stern.nyu.edu/~adamodar/New_Home_Page/datafile/histretSP.html
And I'm not just cherry-picking the boom periods. The above is inclusive of all periods, down, up, flat.
And when the market recovers and goes on to set yet more new all time highs, I will say "I told you so" to anyone who thinks it will never recover.
The market periodically sets new all time highs. It has never set an all-time low.
Yes it goes up and down and up and down and ... but the pattern is that new lows are higher than the previous lows and new highs are higher than the previous highs.
What really matters as far as risk is the risk of running out of money in retirement, and that risk is much higher for people who don't have any equities and only rely on "safe" fixed income investments, which don't even keep up with inflation. Innumerable historical simulations in innumerable studies have shown that. IOW its a bigger gamble not to be in the market. I don't wish to take that gamble.
I hate to see my fellow progressives misled by anti-equity JackPineRadicals-style "progressive" malarkey and end up having to live a very financially constrained old age, not to mention having very little or nothing to give to Democratic candidates or progressive causes. And by default having to accept the minuscule interest that the banks usually dole out in savings and CDs and so on.
Only a fool gambles with their retirement security -- And it makes DU investors out to be fools because only a fool would wager their retirement security on a Vegas slot machine. We are not fools. In the face of inflation and withdrawals, it's an even bigger gamble to NOT have a sizable proportion in equities.
Yes, a lot of people. 58% of American adults own stock according to a Gallup Survey, 3/5/23 https://www.msn.com/en-us/money/savingandinvesting/only-15-of-american-families-directly-own-stock-and-that-s-okay/ar-AA188NL7
pointing to the detailed report at https://www.fool.com/research/how-many-americans-own-stock/
And if the big crash happens on President Biden's watch, it will be super-painful for everyone to the left of Attila The Hun come the next election and the 4 years after.
Edited to add 1205pm ET: I wish someone could tell me which "Indian casino" gives its clients on average a 223% cumulative return over 10 years, a 537% cumulative return over 20 years, a 1,444% cumulative return over 30 years, a 6,759% cumulative return over 40 years, a 13,016% cumulative return over 50 years, a 33,400% cumulative return over 60 years, and a 120,090% cumulative return over 70 years, because I sure would like to "gamble" there. The equity market is AN INVESTMENT.
What drives the market is earnings (not "luck" or the pull of a slot machine handle ). This from Peter Lynch in 2001:
GRAPHS - Core PCE - Rolling 3 month, 6 month, and 12 month averages thru January 2023
It all points to a Core PCE that is a bit more than double the Fed's target. Before January's number, one could argue there's been a very slow downward tilt over the last 6-8 months. With January's number, it's more like a flatlining.
Some may say that January is an anomalous "one off" on the high side. Others may say that December is an anomalous "one off" on the low side that January corrects.
There's a lot of chatter about the "no landing" scenario -- that inflation continues to stay elevated like in the graphs. I think with just a quarter percent rate hike on March 22, and another quarter point increase on May 3, that will likely continue to be the case for a long time.
With the hawkish noises from several FOMC members since the mid-month CPI and PPI reports, and more since yesterday, I think a half percent rate hike in March is a better bet. Note that before the March 22 FOMC meeting, new CPI and PPI reports will be released. (The next PCE report is March 31).
GRAPHS: The "x" axis is the month of the year, where the "1" is January 2022, "12" is December 2022, and "13" is January 2023.
All of the percentage increases are annualized numbers
On the rolling 3 month one can say its been flatlined since April 2022 at around 4.5%, with wiggles
The rolling 6 month - one can say its been flatlined since January 2022 at close to 5%, with wiggles
The rolling 12 month average has basically flatlined since July to about 4.7%.
I've always been a severe critic of 12 month inflation numbers when assessing RECENT or CURRENT inflation, but provide it for comparative purposes.
CORE PCE, which is shown in the above graphs: https://fred.stlouisfed.org/series/PCEPILFE
(PCE is at: https://fred.stlouisfed.org/series/PCEPI )
Percentages are calculated from the actual index numbers, not on averaging one-significant-digit numbers.
At 4.5% inflation, the value of a dollar drops to 50 cents in just 16 years.
Extra funding does little to increase dental care for Medical Assistance recipients (MN)
MPR, February 24, 2023
But Sundve, who lives in Litchfield, Minn., said getting her foster kids in to see a dentist was hard. It's because they're on Medical Assistance — or Medicaid, as it's more commonly known outside Minnesota — and don’t see a dentist regularly.
You call and call and call and ask people if they have any new patients’ availability. And the answer often is ‘No.’"
. . . In 2021, state legislators tried to fix the problem by nearly doubling the amount of money MA pays dentists for each appointment. They set goals for the number of visits MA enrollees should have annually.
But based on data from the state and from health insurance companies that manage most MA enrollees, the changes haven’t made much of a difference.
For years, low reimbursement rates were to blame for Minnesota’s notably low access to dental care for MA enrollees, Liebling said. Rates were based on decades old dental costs.
“Kind of famously, those rates are really low. Another complaint we would hear is that dentists weren't even told what they would be paid until after they provided the service,” she said.
MORE: https://www.mprnews.org/story/2023/02/24/extra-funding-does-little-to-increase-dental-care-for-ma-recipients
Reimbursement rates are still way low even after doubling, compared to regular commercial insurance reimbursement rates or prevailing rates
And there is a big shortage of dental assistants and hygienists.
See also:
About 655,000 Minnesota children were enrolled in Medicaid, but only 36 percent of them received dental services included in their coverage, according to 2017 statistics. That puts Minnesota noticeably below the national average.
The number of dentists who see children in public programs declined from 2,906 in 2015 to about 2,253 last year, according to the Department of Human Services.
More: https://www.mprnews.org/story/2018/11/28/low-income-minnesota-families-struggle-to-get-dental-care
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