Public Peek: Truflation US Inflation Update for September 2024
The following is a public peek at our exclusive monthly Truflation CPI update, available in full by subscription, here.
The labor market is evolving, with increasing pressure for better wages. Historical shifts from a labor to investment economies are resurfacing, emphasizing the need for equitable compensation.
With the constant pressures for better wages, the historical shifts from a labor to investment economy are resurfacing, emphasizing the need for equitable compensation. Since 2019 how much did the stimulus of trillions and trillions of dollars (tax cuts, corporate tax rate cuts (35% to 21%) deregulation etc go) back into stock buy-backs vs going into the labor market. Capital and labor need to come together to drive value but capital has been better renumerated in the past decade, but is it now labor that needs to be renumerated better than it has been in the past? This requires negotiations and persistence to drive, and the unions have been making a significant impact - with the most recent port strike being another example of this movement.
The rise of AI presents further challenges as the need to upskill the labor force vs replacing is the biggest challenge. Based on the labor data we are seeing more replacements by organizations. It will affect all jobs and we have to be prepared to improve our skill set and master the tool. It is fast and transformative and will revolutionize our economy faster than globalization.
Despite the high interest rates and inflationary pressures the economy has been resilient and the investor community is increasingly growing more confident that the global economy can achieve a soft landing, with 79% of investors in the Bank of America’s survey optimistic of a soft landing.
Navigating the path to lower inflation will remain challenging especially with the gradual decline in interest rates that the central bank has suggested.
Exhibit 2 - Truflation key inflationary metrics: Goods vs Services vs Core Inflation
The above is a public peek at our exclusive monthly Truflation CPI update, available in full by subscription, here.