Is Inflation on the Way Out?

The worst of inflation may be over.

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1. Noah Smith

Economist Noah Smith notes that prices are starting to come down, but that no one is certain why:

For over a year now, we’ve seen inflation rise relentlessly. Price rises have lowered real wages for most workers, driven popular anger, and threatened economic stability. But there are finally indications that the tide is turning. In March, financial markets were predicting an annualized inflation rate of around 3.5% over the next five years; now, that number is down to 2.6%.

And expectations for inflation over the following five years, which had spiked up during the initial phase of the Ukraine war, have plunged back toward the Fed’s official 2% inflation target:

So markets think prices are going to cool down.

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Noah also put together some other indicators that suggest deflation:

1. Falling freight rates

2. Falling commodity prices

3. Easing rents

4. Cheaper GPUs

5. Rising retail inventories

Read the whole thing. You will be buoyed.

The question Noah digs at is why? Is supply finally getting worked out? Or is demand softening? Or some combination of the two. That’s the goal:

The goldilocks scenario here, of course, is that the Fed manages to cool off the economy just enough to bring down inflation, but no more. The Federal Bank of New York thinks there’s only a 10% chance we’ll get this “soft landing”, but Goldman Sachs thinks we’re still on track to pull it off.

Barry Ritholtz has even more on the possibility that inflation has peaked.

Really, you should subscribe to both Noah and Barry to get smart on this stuff.

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You know who is less smart on this stuff? Voters.

The other day my best friend Sarah Longwell mentioned that in focus groups she now hears voters complain about both inflation and rising interest rates.

Imagine that your house is on fire. And you’re standing on the street complaining about it and wondering why no one will put the fire out.

Then the fire department shows up and start dousing the flames.

And you switch to complaining that they’re going to ruin your sofa and carpets with all the water.

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2. Matt Labash

My buddy goes HAM on Mark Meadows. Enjoy the carnage:

For as long as he’s been a public self-servant, the towel boy who served as Donald Trump’s fourth and last chief of staff has been a professional sleazebag. He’s no cartoon villain, mind you. If Meadows were a color, he’d be beige. Blessed with the pleasantly dishonest face of a swampland timeshare hustler, the former congressman, who once described himself  as being a “fat nerd” as a kid, rarely says anything funny or compelling, unlike his Lord & Savior Donald H. Christ. Yet he forever manages to be controversial without actually being interesting, the sinisterness equivalent of a white noise machine. . . .

Susan Glasser, who along with her husband Peter Baker, has written an upcoming book on the Trump presidency and its violent conclusion,   additionally lanced the Meadows boil  in The New Yorker, confessing that while reporting her book, she was often stumped by Meadows’ sometimes inscrutable duplicity. Entranced by his Oval Office access, Meadows would show off the call log on his iPhone to a reporter, just to prove he was speaking with “VIP POTUS.”  Yet it was unclear, Glasser writes, whether “he was one of the responsible adults around Trump trying to land the plane safely,” or whether he was “one of the hijackers.” He acted less like “a gatekeeper than a door opener” for every crank and conspiracy theorist who wanted to see Trump.  As one Republican in the White House’s orbit told Glasser, “Meadows was basically a matador. He’s sort of just let in anybody and everybody who wanted to come in.”

And so, on the one hand, Meadows would tell concerned White House colleagues privately during Trump’s florid post-election conspiracy theory phase, a phase Trump’s not yet emerged from: “Trust me, I’m gonna get the president there, he’s gonna drop this issue. Just kind of give him time to mourn and grieve, and then he’s going to come around.”  While with the other hand, Meadows was texting Ginni Thomas, Clarence’s nutter wife who pushed election fraud almost as hard as the My Pillow guy, telling her, “This is a fight of good versus evil. Evil always looks like the victor until the King of Kings triumphs. Do not grow weary in well doing. The fight continues. I have staked my career on it.”

“He would lie to people’s faces,” one White House official told Glasser and Baker.  Former White House press secretary Stephanie Grisham, who was pushed out by Meadows, called him, “one of the worst people ever to enter the Trump White House,” saying that on a one-to-five scale of awfulness, “I’d give Mark Meadows a twelve.” Glasser writes that others called him “an absolute disaster” who played to “all the President’s worst instincts.” While a former Republican leadership aide, in the kind of obloquy usually reserved for Ted Cruz, told journalists Anna Palmer and Jake Sherman  that Meadows was  the most dishonest person they ever met at the Capitol, “convicted criminals included.”

Read the whole thing and subscribe.

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3. Chess Talk

Joe Posnanski writes about chess:

Dad was a master-level chess player in those days, with a rating that at one point topped 2000. These days, there are a lot of 2000-rated players in the U.S. and the world, but back then it was a pretty rare height. I’m not sure how many people in America back then were 2000-rated chess masters and also 200-average bowlers like my father — that had to be a pretty small club. All I can say is with any confidence is that if you start your filtered search with “2000-rated chess” and “200-average bowler” and then throw in “former semi-professional soccer player” and “credible amateur magician,” Dad would have been the only one to show up in that filtered search.

There were many father-son chess lessons through the years, but I have strong memories of only one. It was a Sunday afternoon, and I recall it being uncommonly sunny outside, particularly for Cleveland. It was probably summer. My father unrolled the green-and-white board on our dining room table. The dining room was a little enclave next to the living room but we didn’t dine there (nor did we live in the living room — it was off-limits). We did play all our games in the dining room, though, from Yahtzee to Life to Mille Bornes to the Guinness Book of World Records game to this old Parker Brothers board game called Careers. . . .

On this particular sunny day, my father laid out the chess board and then put just three pieces down — the white king, the black king and the black rook.

“OK,” he said. “Try to mate me.”

In my memory — which is in the faded colors of 1970s television — I kept trying to check the king using only my rook. You cannot get checkmate this way. The king will always have an escape route if you use only your rook (and if you’re not careful, the king eventually will get close to the rook and capture it — as my father displayed several times in the lesson).

No, to get checkmate, you must do this intricate little dance — you must, using BOTH the rook and king, methodically back the opponent’s king to the edge of the board. Then, and only then, can you finish the game by forcing the two kings to face off, and then swooping in the rook for victory.

Dad showed me the pattern once, twice, three times, and I loved it. I absolutely loved it. For the next hour or two or five, who knows, I would have him reset the board, and I would slowly but surely checkmate him again and again and again.

I think about that day a lot. I think about how happy my father was — it was the one day when I was enraptured by chess as he was. Looking back, I don’t think I took to chess quite the way my father wanted. We have never talked about it, but I have always suspected that he would have liked for one of his three sons to be as fascinated by the Game of Kings as he was. And, alas, none of us were.

Read the whole thing.

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