@paulkrugman is right that measuring inflation is difficult. But he continues his pattern of choosing to emphasize issues that could lower rather than raise expected inflation. He ignored the housing issues when I and others were pointing them out last year.
The same point about new transactions vs. past transactions present wrt housing applies to the labor market but Paul fails to note that new hire wages are still way up and reservation wages continue to climb. He doesn’t consider that effort may be down for those working at home.
Nor does Paul note that some of the deflation seen in used cars and other sectors is not sustainable because it reflects the unwinding of past price run ups.
There is the further point that non availability is much more common than several years ago and implies that “real prices” are higher than measured ones.
It may well be that given the balance of risks the @federalreserve should stop hiking soon but the debate is best framed recognizing all the biases in official measures.


これにクルーグマンは、Joey Politanoという経済ライターのこちらのツイートをRTすることで応じている。

Incredibly ironic that while chiding Paul Krugman for overlooking data lags in housing CPI last year Larry Summers cites data that is a 12-month moving average of observed wage growth rates. In other words, more lagging data.


Some notes on inflation. First, clearing up a misconception: no, measures like "supercore" that exclude food, energy, shelter and used cars aren't finding disinflation by throwing out the inflation 1/
Headline inflation is actually being held down by some clearly one-off things, like falling gas prices, but also being exaggerated by shelter prices that reflect a rent surge that ended many months ago. Overall it's more or less a wash, and the disinflation is real 2/
Second, the current inflation debate is very different from the one that took place in 2021. Then, Team Transitory argued that despite large fiscal stimulus we wouldn't see a big rise in inflation; we were wrong, and have admitted that 3/
But now the argument is between what we might call Team Stagflation and Team Soft Landing. Many of the same players, but in many ways a role reversal in arguments 4/
At this point the big surge in domestic spending is behind us, with nominal spending growth rapidly slowing to rates more or less consistent with target inflation 5/
Team Stagflation nonetheless argues that inflation will remain high, that bringing it down will require an extended period of high unemployment, as happened in the 1980s. And of course they could be right. But what's their theory of the case? 6/
Textbook macro says that inflation can become entrenched via expectations. But medium- and long-term inflation expectations never rose much, and are now back to roughly pre pandemic levels 7/
You could argue that the textbook model is all wrong, and inflation will be sticky for other reasons. But most of the data seem to show inflation falling fast, and attempts to deny the good news are getting increasingly contorted 8/
We are still waiting for Godot, I mean the Employment Cost Index, which might (or might not) give some new justification for pessimism. But as Joey Politano says, the available data suggest deceleration 9/

My hope is that people who were right about inflation — and got a lot of justified credit for making that call — won't try to hold on to their glory days by denying the growing evidence that the inflation surge is behind us 10/



(Joey Politanoのツイート*2


*1:cf. ここ