The gap between everyday experience and the yearly inflation rate of 1.3% in August is massive. The price of the stuff we're buying is rising much faster, while the stuff we're no longer buying has been falling, but still counts for the figures.

Economists will be relieved that the laws of supply and demand are still working, at a time when so much in the discipline is in doubt. But for investors it hangs a veil over the outlook for perhaps the single most important issue for the markets: whether we're headed for a future of inflation, deflation or a continuation of the past decade's lackluster price rises.

Start with recent supply and demand. The cost of food at home, where so many of us have been spending our time, was up 4.6% in August compared with a year earlier, the biggest rise in almost a decade. In deserted workplace and school cafeterias, food is 3% cheaper.

Food prices move around a lot, but the same pattern shows for many things sensitive to us sitting at home on Zoom. Few home workers need a new suit or dress (down 17%), makeup (down 3%), hotel room (down 13%) or air ticket (down 23%).

In vogue: sitting at home in your pajamas (men's nightwear is up 4%), cycling (bikes up 6%), reading for pleasure (books up 4%, newspapers up 5%) and making things (sewing machines and fabric up 9%, cameras up 4%). Medical care is in demand (up 5%), while higher education is much less attractive (tuition fees up 1.3%, the lowest since data started in the late 1970s).


https://www.morningstar.com/news/dow...ly-want-to-buy

Water is wet?

Anyone in distribution knows the stated inflation rates are BS. I can show you historical prices for things and we've seen doubling in 10 years in some areas.

Just looked up a fitting for example we bought for 29 cents in 1997 is now 75 cents. All those supply line increases end up getting passed to consumers.