Inflation
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Thought this might be a good "everyday" topic
You guys noticing it in NZ?
Oil and food inflation are going to create hard times for a lot of the working and middle class.Bloomberg tweet, very depressing. Almost like the author is taking the piss.
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Before this gets topic moved to the politics thread, I'm noticing it with key basic groceries here in Oz (e.g. my TP brand, meat, vegetables) and at quite a few restaurants.
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@nepia restaurants are partly the stupid roller coaster hospitality has been on during the pandemic.
Our weekly grocery bill has been creeping up from the high 200s a few years back to regularly high 300s now. Partly that's my wife not understanding that it's perfectly ok to buy less than 500 tonnes of meat every week. She's Italian
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Wheat cash contract in the last month (around 40% increase)
Oil since beginning of year (around 50% increase)
Whether these trends are permanent or not is the worrying thing.
The world won't like 150 dollar barrel oil or more.(images from my trading charts)
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Wheat cash contract in the last month (around 40% increase)
Gee I wonder what could have possibly happened in the last month that would do such a thing?
Oh wait, found it... https://beef2live.com/story-top-20-largest-wheat-exporters-world-0-206491
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Oil since beginning of year (around 50% increase)
The world won't like 150 dollar barrel oil or more.
It is every cog in the machine, too, so consumers suffer the rise in cost at multiple levels.
If Russia was as big an exporter of crude as it is grain - in terms of proportion of total - things would go mental very quickly. Fortunately they're not OPEC.
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Just hit the state government fuel check site - 98RON is at stupid levels. Fortunately with WFH I'm not likely to cover a lot of km week by week, but any road trips are now a serious financial undertaking.
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Looking at Russia and Ukraine producing about 30% of the world's grain, might be time to get back on that carb-free diet
Scary shit, TBH. I follow a few Aussie farmers on Twitter and they're actually a bit torn on the morals of a higher grain price due to people dying in a shitty conflict...
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Just hit the state government fuel check site - 98RON is at stupid levels. Fortunately with WFH I'm not likely to cover a lot of km week by week, but any road trips are now a serious financial undertaking.
We were under 2 today.
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@booboo for premium or E10?
There is a BP near an Ampol the next suburb over - drove past last week with BP at $2.09 for E10 and Ampol $1.88
Traffic jam!
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@booboo for premium or E10?
There is a BP near an Ampol the next suburb over - drove past last week with BP at $2.09 for E10 and Ampol $1.88
Traffic jam!
Actually not sure. Just noticed petrol prices at the servo at our favourite coffee drive through we're both under 2 (I.e., 199.9 & 195.9 - Can't remember which was which.) Was in the work ute (fuck using my own fuel) and am awaiting fuel card so wasn't filling up ... and it's diesel which was still well over 2.
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Whilst those rationales my have some merit on the longer term oil price they have no real bearing on what has happened over the last month or so. We’ve seen oil going from under $100 to over $130 and back below $100 in less than 30 days. That has nothing to do with oil being more expensive to produce or the cost of capital to the industry. That is all to do with speculation based on fear of a supply chain problem.
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@catogrande said in Inflation:
Whilst those rationales my have some merit on the longer term oil price they have no real bearing on what has happened over the last month or so. We’ve seen oil going from under $100 to over $130 and back below $100 in less than 30 days. That has nothing to do with oil being more expensive to produce or the cost of capital to the industry. That is all to do with speculation based on fear of a supply chain problem.
Yes, the recent spike, but the author is not talking about that, he's meaning the longer term rise which has been in effect since November 2020.
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@catogrande said in Inflation:
Whilst those rationales my have some merit on the longer term oil price they have no real bearing on what has happened over the last month or so. We’ve seen oil going from under $100 to over $130 and back below $100 in less than 30 days. That has nothing to do with oil being more expensive to produce or the cost of capital to the industry. That is all to do with speculation based on fear of a supply chain problem.
Yes, the recent spike, but the author is not talking about that, he's meaning the longer term rise which has been in effect since November 2020.
One could actually argue slightly longer, from early 2020 when it bottomed out at less than $17 (a price not seen in the previous twenty years) but that would just be further cherry picking of data to support an argument. Similarly picking a date of late 2008 we can construct an argument of the systematic falling of oil prices from a high of around $145. Neither argument holds water.
Sure, he has a point that tightening of capital will have an effect on the ability for exploration but in truth cash-flow and therefore access to capital has not really been an issue, certainly for the larger companies, for a very long time. It may have an effect in the much longer term if that trend continues but currently the oil price is pretty much manipulated by the turning on or off of the taps by OPEC. Outside of that supply issue speculation, which is caused by fear and greed is the next biggest impact.
He's basically an advert for the oil industry.
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@catogrande said in Inflation:
That is all to do with speculation based on fear of a supply chain problem.
From stolen elections, to white supremacist cops, to global pandemics and variants-du-jour, will-he-or-won’t-he employ mustard gas in Ukraine… our news industry seems to be composed almost entirely of nothing-but speculation based on fear. This is Who We Are.
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@catogrande It's the Fern so obviously I didn't read the piece, but fracking?
Massive reason for the drop in oil prices. Us went from an importer to one of the biggest exporters. Cue legislative changes rising compliance costs. Also contributed to the rise. Not as much as the fall but still an influence.
I learned yesterday that the original Ford's were designed to run on petrol or alcohol. Ford let the market decide. Imagine the impact on drink driving
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It won’t be long till alcohol is cheaper!
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@kid-chocolate it's media, it's always been that way. 'if it bleeds, it leads'; no one cares about good news
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@nzzp Unless it's a kitten rescued from a drain. Then it's all over the news.
Otherwise it's the infamous "anyone here a white woman who's been raped"
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@kid-chocolate it's media, it's always been that way. 'if it bleeds, it leads'; no one cares about good news
That is partly true, partly fallacy. The gatekeepers decide what’s going to give us nightmares and keep us docile and compliant. It’s mind-manipulation.
The World’s Deadliest War Isn’t in Ukraine, But in Ethiopia
In Ethiopia, Africa’s second-most populous nation, a bloody civil war is now in its 16th month.
Until two days ago, I did not know this. Why?? ‘Cos most of my news media, who apparently loves blood ‘cos it supposedly sells more fishwrap, doesn’t want to talk about it any more than they want to shine a spotlight on Yemen. There are variable justifications for these refusals of interest, from the colour of their skin and their religious beliefs (“ooh, they’ve always been savages”) to the same media not having invested years of rabid hysteria into making either of the majordomos in those wars into their latest cartoon Bond villian (“he stole the election, he’s plotting to take over the world!!”), etc.
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I’m finding it ironic that those governments that hugely increased their money supplies to counter the effects of their COVID decisions now blame everything except their own actions for the inflation that’s arrived. Amazing to watch really.
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I’m finding it ironic that those governments that hugely increased their money supplies to counter the effects of their COVID decisions now blame everything except their own actions for the inflation that’s arrived. Amazing to watch really.
It's like they waited for a convienient crisis to blame it all on. Sad thing is it will work.
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I’m finding it ironic that those governments that hugely increased their money supplies to counter the effects of their COVID decisions now blame everything except their own actions for the inflation that’s arrived. Amazing to watch really.
The best thing is their response to inflation is itself extremely inflationary......California giving $400 per car grants for gas price relief
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Possible?
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@frank short answer yes
from dairy farmers point of view
from costs are through the roof
wages up 15 -20 %
fert up 200% +
sprays etc 200% +
some of these have happened over the last two seasons so havnt been adsorbed into this season but next season is going to be rough. eg sprays used may have been at a lower price but will have to pay more next season.
as a rule of thumb most farmers will have an increase in costs off $2 per kg of milksolds plus interest rates going up .
as a general i would expect alot of costs like detergents /cowshed costs/general cost will rise about 25% on what they started this season at for next. -
Food crisis coming, farm leader warns
The price of diesel has gone up so much that it cost Valetta grain farmer David Clark $4000 to fill up his combine harvester. By the time he had...
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Very relevant to inflation.
Will it work?
U.S. weighs largest ever draw from emergency oil reserve
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The Biden administration is considering releasing up to 180 million barrels of oil over several months from the Strategic Petroleum Reserve (SPR), four U.S. sources said on Wednesday, as the White House tries to lower fuel prices.
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Once total inventory gets below a certain point, there will be no buffer, the market is going to freak out and oil will go ballistic. Keeping the price artificially low will stimulate demand and suppress supply accelerating the onset of the shortage and price spike. It is the exact opposite of what you would want to do prevent an actual shortage from occurring. So instead of opening up a pipeline to Canada or allowing the market to increase domestic production, they'll reduce the security that the reserve is meant to provide.
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Once total inventory gets below a certain point, there will be no buffer, the market is going to freak out and oil will go ballistic. Keeping the price artificially low will stimulate demand and suppress supply accelerating the onset of the shortage and price spike. It is the exact opposite of what you would want to do prevent an actual shortage from occurring. So instead of opening up a pipeline to Canada or allowing the market to increase domestic production, they'll reduce the security that the reserve is meant to provide.
It’s not so much the release of the reserves it’s the stated intent. Effectively so far we’ve just had an indication that he’s going to say he will release reserves and already it has reduced prices significantly. If it comes to them actually having to follow through I’d be surprised.
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@catogrande its the Saudis that arent playing ball isnt it, get them into upping production will ease things off at the pump.
While there really is endless buyers for oil in the current world we live in, the theory would be is if the US release reserves it eases pump prices, obviously this will hurt the Saudis so they up thier production slightly to take some heat while maintaining high prices, win win...
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I'm not sure that's quite right. There is no shortage of oil, there are no queues at the filling stations, no restrictions on amounts you can buy. There has been no real increase in the cost of extracting and refining crude oil. The high levels of volatility we've seen recently are down to speculation about future supplies. Given that the oil that is providing the petrol we are buying today was probably refined back when Brent Crude was under $70 a barrel it has never been about costs.
Where I'm sure that you are right is that the real player here is Saudi. If they reduce their prices or turn on the taps a bit more it will have a significant impact and maybe Biden is showing them as much as anyone that he is (maybe) prepared to do something about this spike in prices.
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If they do through with it, it had better work, because if it doesn't, you have the situation of the US govt having to replenish its emergency supplies when it might be $100+ barrel. What could possibly go wrong?
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If they do through with it, it had better work, because if it doesn't, you have the situation of the US govt having to replenish its emergency supplies when it might be $100+ barrel. What could possibly go wrong?
That's assuming that the US just holds a giant tank of oil that they extracted back in 1974 rather than simply holding back a degree of the ongoing output...
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@catogrande I didn't think I was implying a shortage.
Didn't Biden ask the Saudis to increase production at the start of the war, but they have thier own agenda before this will happen (aside from money)
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@taniwharugby said in Inflation:
@catogrande I didn't think I was implying a shortage.
Didn't Biden ask the Saudis to increase production at the start of the war, but they have thier own agenda before this will happen (aside from money)
Ah, I misunderstood that bit. Apologies.
I think there has been much discussion about how to manage the current volatility and too many conflicts of interests. If the Saudis were not listening to the US, maybe thinking Biden is weak, then perhaps this latest utterance is to persuade them otherwise. What is virtually certain is that, for the Saudis at leat, this is more than just the price of oil. So we agree on a broader scale.
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EU proposes ban on Russian coal, working on oil sanctions
The European Commission on Tuesday proposed banning Russian coal as part of a new round of sanctions against the Kremlin for its unprovoked invasion of Ukraine.
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It’s all under control.
Farmers on the Brink
