{"id":67901,"date":"2024-05-05T15:47:05","date_gmt":"2024-05-05T20:47:05","guid":{"rendered":"https:\/\/olduvai.ca\/?p=67901"},"modified":"2024-05-05T15:47:05","modified_gmt":"2024-05-05T20:47:05","slug":"home-prices-hit-new-record-high-dont-worry-its-not-inflation","status":"publish","type":"post","link":"https:\/\/olduvai.ca\/?p=67901","title":{"rendered":"Home Prices Hit New Record High, Don\u2019t Worry, It\u2019s Not Inflation"},"content":{"rendered":"<div class=\"wp-block-columns alignwide is-layout-flex wp-container-core-columns-is-layout-1 wp-block-columns-is-layout-flex\">\n<div class=\"wp-block-column is-layout-flow wp-block-column-is-layout-flow\">\n<h3 class=\"alignwide wp-block-post-title has-gigantic-font-size\"><a href=\"https:\/\/mishtalk.com\/economics\/home-prices-hit-new-record-high-dont-worry-its-not-inflation\/\">Home Prices Hit New Record High, Don\u2019t Worry, It\u2019s Not Inflation<\/a><\/h3>\n<\/div>\n<\/div>\n<div class=\"wp-block-columns alignwide are-vertically-aligned-top is-layout-flex wp-container-core-columns-is-layout-3 wp-block-columns-is-layout-flex\">\n<div class=\"wp-block-column is-vertically-aligned-top is-layout-flow wp-block-column-is-layout-flow\">\n<div class=\"entry-content wp-block-post-content is-layout-flow wp-block-post-content-is-layout-flow\">\n<p>The Case-Shiller national home price index hit a new high in February. That\u2019s the latest data. Economists don\u2019t count this as inflation.<\/p>\n<figure class=\"wp-block-image size-large\"><img loading=\"lazy\" decoding=\"async\" class=\"wp-image-65930\" src=\"https:\/\/i0.wp.com\/mishtalk.com\/wp-content\/uploads\/2024\/05\/CS-National-Top-10-Metro-CPI-OER-2024-02-1.png?resize=1024%2C634&amp;quality=80&amp;ssl=1\" sizes=\"auto, (max-width: 1000px) 100vw, 1000px\" srcset=\"https:\/\/i0.wp.com\/mishtalk.com\/wp-content\/uploads\/2024\/05\/CS-National-Top-10-Metro-CPI-OER-2024-02-1.png?resize=1024%2C634&amp;quality=80&amp;ssl=1 1024w, https:\/\/i0.wp.com\/mishtalk.com\/wp-content\/uploads\/2024\/05\/CS-National-Top-10-Metro-CPI-OER-2024-02-1.png?resize=300%2C186&amp;quality=80&amp;ssl=1 300w, https:\/\/i0.wp.com\/mishtalk.com\/wp-content\/uploads\/2024\/05\/CS-National-Top-10-Metro-CPI-OER-2024-02-1.png?resize=768%2C475&amp;quality=80&amp;ssl=1 768w, https:\/\/i0.wp.com\/mishtalk.com\/wp-content\/uploads\/2024\/05\/CS-National-Top-10-Metro-CPI-OER-2024-02-1.png?resize=1536%2C951&amp;quality=80&amp;ssl=1 1536w, https:\/\/i0.wp.com\/mishtalk.com\/wp-content\/uploads\/2024\/05\/CS-National-Top-10-Metro-CPI-OER-2024-02-1.png?w=1567&amp;quality=80&amp;ssl=1 1567w\" alt=\"\" width=\"713\" height=\"441\" \/><figcaption class=\"wp-element-caption\">Case-Shiller national and 10-city indexes via St. Louis Fed, OER, CPI, and Rent from the BLS<\/figcaption><\/figure>\n<p><strong>Chart Notes<\/strong><\/p>\n<ul>\n<li>National and 10-City Case-Shiller home prices hit new record highs in February<\/li>\n<li>OER, CPI, and Rent are indexes measured by the Bureau of Labor Statistics (BLS).<\/li>\n<li>OER stands for Owners\u2019 Equivalent Rent. It\u2019s the price one would pay to rent one\u2019s own house unfurnished and without utilities.<\/li>\n<\/ul>\n<p>Case-Shiller measures repeat sales of the same home over time and the indexes attempt to weed out major home improvements.<\/p>\n<p>Case-Shiller is a far better measure of home prices than median or average prices which do not factor in the number of rooms, location, lot size, or amenities.<\/p>\n<p><strong>Not Inflation?!<\/strong><\/p>\n<p>Economists, including the Fed, consider homes a capital expense, not a consumer expense.<\/p>\n<p>As a result, they all ignore economic bubbles and blatantly obvious inflation on grounds it\u2019s not consumer inflation. This has gotten the Fed into trouble at least three times. The first was the dot-com bubble, then the Great Recession housing bubble and now.<\/p>\n<p>It\u2019s really pathetic when you make the same major mistake over and over and over. It\u2019s a result of group think.<\/p>\n<p>They all believe in the same silly models based on disproved theories including inflation expectations and the Phillips curve. You do not get in the good ole boys Fed club unless you think like a good ole boy.<\/p>\n<p><strong>Inflation Expectations<\/strong><\/p>\n<p>Fed Chair Jerome Powell mentions inflation expectations at every meeting. So did former Chairs Janet Yellen and Ben Bernanke.<\/p>\n<p>In my post\u00a0<strong><a href=\"https:\/\/mishtalk.com\/uncategorized\/how-do-inflation-expectations-impact-wages-and-future-inflation\/\" target=\"_blank\" rel=\"noopener\">How Do Inflation Expectations Impact Wages and Future Consumer Inflation?<\/a><\/strong>\u00a0I explain why inflation expectations are irrelevant to future inflation.<\/p>\n<p>Moreover, two Fed studies agree.<\/p>\n<p>&#8230;click on the above link to read the rest of the article&#8230;<\/p>\n<\/div>\n<\/div>\n<\/div>\n","protected":false},"excerpt":{"rendered":"<p>Home Prices Hit New Record High, Don\u2019t Worry, It\u2019s Not Inflation The Case-Shiller national home price index hit a new high in February. That\u2019s the latest data. Economists don\u2019t count this as inflation. Case-Shiller national and 10-city indexes via St. Louis Fed, OER, CPI, and Rent from the BLS Chart Notes National and 10-City Case-Shiller [&hellip;]<\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"closed","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_monsterinsights_skip_tracking":false,"_monsterinsights_sitenote_active":false,"_monsterinsights_sitenote_note":"","_monsterinsights_sitenote_category":0,"footnotes":""},"categories":[2],"tags":[5862,14648,13390,13351],"class_list":["post-67901","post","type-post","status-publish","format-standard","hentry","category-economics","tag-home-prices","tag-michael-shedlock","tag-mishtalk","tag-price-inflation"],"_links":{"self":[{"href":"https:\/\/olduvai.ca\/index.php?rest_route=\/wp\/v2\/posts\/67901","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/olduvai.ca\/index.php?rest_route=\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/olduvai.ca\/index.php?rest_route=\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/olduvai.ca\/index.php?rest_route=\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/olduvai.ca\/index.php?rest_route=%2Fwp%2Fv2%2Fcomments&post=67901"}],"version-history":[{"count":1,"href":"https:\/\/olduvai.ca\/index.php?rest_route=\/wp\/v2\/posts\/67901\/revisions"}],"predecessor-version":[{"id":67902,"href":"https:\/\/olduvai.ca\/index.php?rest_route=\/wp\/v2\/posts\/67901\/revisions\/67902"}],"wp:attachment":[{"href":"https:\/\/olduvai.ca\/index.php?rest_route=%2Fwp%2Fv2%2Fmedia&parent=67901"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/olduvai.ca\/index.php?rest_route=%2Fwp%2Fv2%2Fcategories&post=67901"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/olduvai.ca\/index.php?rest_route=%2Fwp%2Fv2%2Ftags&post=67901"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}