Wednesday, October 16, 2019

Notes From All Over, Part 2 -- October 6, 2019

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Inflation watch: long-term inflation expectations -- repeat, expectations -- hit a record low: NY Fed -- The WSJ. Three-year ahead inflation expectations -- repeat, expectations -- fell to 2.4% in September.
The Federal Reserve Bank of New York said Tuesday that longer-run inflation expectations hit the lowest level the bank has ever tracked in its latest monthly Survey of Consumer Expectations.
The central bank said that in September, the public’s expectation of inflation three years from now fell to 2.4% from 2.5% the prior month. That is the lowest reading since the start of the survey in 2013. Shorter-run inflation expectations fared a touch better, however, with the public’s expectation of inflation a year from now moving up to 2.5%, from 2.4% in August.

How did the Fed arrive at this number? Are you sitting down?
The drop in expected inflation three years from now “was driven by the respondents with household incomes less than $50,000 and those with a high-school diploma or less,” the New York Fed said.
Are you kidding? This was a headline story for The WSJ? This is how the NY Fed forecasts long-term interest rates? Okay -- I understand -- they are reporting expectations -- but still, this is a headline story.

Well, for the record, a lot of college-educated folks with incomes greater than $150,000 may have different expectations. 

Garrett watch: it's now being reported that the Dallas coach is on the "hot seat" after three consecutive losses -- including the most recent loss against the weakest team in the league.

Down At The Farm

Sophia learned the difference between tires and wheels. 

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