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Inflation 4.1% August 2021 (Ouch)

For those that have not followed me since 2005, allow me to say, I told them so. Back in 2009, I warned Inflation was coming with all this stimulation, and here it comes (in 2021).

OK, so I am very much the Blogger who Cried Wolf on Inflation. I am not even sure this is going to be the beginning of an Inflationary spiral.

Stats Canada thinks:

The Consumer Price Index (CPI) rose 4.1% on a year-over-year basis in August, the fastest pace since March 2003, up from a 3.7% gain in July. The increase in prices mainly stems from an accumulation of recent price pressures and from lower price levels in 2020. Excluding gasoline, the CPI rose 3.2% year over year.

From Stats Canada Consumer Price Index, August 2021

This is the highest rate since before I started commenting in 2005? Something to note folks. Governments can’t keep printing money with impunity.

Gasoline is a major driver right now as can be seen when it is taken out of the calculations. Prices are rising, and you have Governments pumping money into the situation. What happens when that money stops? The other issue is you have a reticent workforce, who doesn’t really want to go back to their crappy jobs. Not a recipe for economic greatness.

What does the Bank of Canada think about this? Actually using their calculations we are only a little bit above their goals?

lternative measuresMay 2021June 2021July 2021August 2021
Measure of core inflation based on a factor model, CPI-common (year-over-year percent change)
Measure of core inflation based on a weighted median approach, CPI-median (year-over-year percent change)
Measure of core inflation based on a trimmed mean approach, CPI-trim (year-over-year percent change)
Consumer Price Index statistics, preferred measures of core inflation – Bank of Canada definitions, year-over-year percent change, Canada

Source(s):Table 18-10-0256-01.

Additional Reads From Stats Canada

Previous Rants About Inflation

And that is just scratching the surface.

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