June 1, 2021 • 47 mins
Inflation seems super boring, but if you know how it works (important point: no one really does) you can exist as a functioning human being in a modern economy.
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Episode Transcript
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Speaker 1 (00:01):
Welcome to Stuff You Should Know, a production of I
Heart Radio. Hey, and welcome to the podcast. I'm Josh Clark.
There's Charles w. Chuck, Wayne Waynester, Wayne Train, what what,
Wayne Bryant, And there's Jerry Jerome Roland over there, and
(00:24):
this is Stuff you should Know. Yeah, kill me episode whatever, dude,
this is fine. I was going to say that, I
know it's again. We just did an economics episode. What
was it. I don't know, but I think economics is
literally right there. Besides, like chemistry and physics for me,
now maybe worse because at least those are interesting to me.
(00:44):
Chemistry and physics still make sense because they're really hard
to understand. Economics doesn't make sense because it's b s
and it's just that's key to understanding economics. I'm good here,
I'll tell you where I'm gonna need help. I'm good,
except for like were paragraphs right there where it says
kill me, it really does, think kill me right there,
(01:05):
and then right there where it says wake up listeners. Whatever,
I'm good. I'm gonna need your help there the rest
of it, this is a personal challenge to keep everyone interested.
That's funny because on the John Your document. I have
blah blah blah over there. Oh boy, are seeing how
(01:25):
the sausage? That's like year one stuff. Dude, No, we've
been doing that forever. I think we generally are into
one another's topics. Yeah, it's not the topic, and I
think economics is boring, is heck? I don't think he
was what we'll talk about John here in the John
Your episode. How about that? I was about to defend
my position on well that have already been out. I
(01:46):
don't know, man, we'll find out. I think people should
play these back to back. So you should, especially the
Cleft episode, because the listener mail from the Cleft episode
really sets up some of the jokes in the night
Trap episode that follows. So don't listen to those two. Well,
those are too fun to listen to. I think listeners
listen to these two back to back. It's like Thilman
(02:09):
Louise territory right into the Grand Canyon. What does that mean?
Have you never seen Tholm and Louise? I have, but
I don't get how it applies to listening to these
episodes out of order spoiler alert for Tholma and Louise. Everybody,
Oh you already kind of in the Grand Canyon. They
drive into the Grand Canon at the end, just straight
off that cliff, And that's what would happened if they
(02:31):
listen to both of these episodes back to back. Well,
i'll tell you what. If you watch Thelma and Louise
as their drive, it really is as they're Actually I've
only seen the last ten minutes. Yeah, really, you're like,
what was their problem? Yeah? Why they do that? It
seems a little overreacting. Um the the if you listen
(02:53):
really really closely, I mean, like, turn your volume up
so loud that you can hear the fawse of the video,
the grain of the video making it sound, you can hear.
I can't remember who's Thelma? Oh why do you ask me?
I always get these two confused. Right now, Gina Davis
is Thelma? I thought she was Louise. Okay, Jerry's got it.
(03:13):
Jerry so mad right now? So so it is Tholma
is Gina Davis says, It says to Louise, well, we
can thank John you're for this beautiful view on the
way to our deaths because no one else cared about
the natural environment. That's actually absolutely right. He's still alone,
(03:34):
No one thought the way that he thought. So we're
talking about inflation. Obviously that was the most fun part
of this episode. But no, it's not. Chuck. I refused
to believe that we're talking about inflation. And the reason
that I picked this is because inflation is kind of
a thing right now. There's a lot of fear until today, Yeah,
I think until today, Um, when the fag came out
(03:56):
and said, everybody, calm down, stop being dramatic, Joe's ruining
the dry there's not going to be an inflation fear
or there's not gonna be inflation. Stop your fears. And
as a matter of fact, um, the fear stopped. Everybody
stopped worrying about inflation because the fact came out and
said something. Yes. And but the reason I picked this
is because it's good to know what people are talking
(04:16):
about when they're like, uh, we should be really worried
about inflation right now. And all you have to do
is understand a few basic things, and all of a sudden,
you're in the convo, baby, sure, and we're going to
explain those few basic things to everybody. And then the
next time inflation starts to go crazy, you can say
everybody just calmed down. Yeah, it's just cost push going on. Yeah.
(04:39):
You you you'll be like, uh at every party you
go to, you can talk about that, and you'll be
the equivalent of Colleen Robinson. Who's that from what we
do in the Shadows? Is that the Energy Empire? Oh yeah, yeah,
he probably sits around and talks about inflation. Yeah. Yeah,
you threw me off with the Colleen. Well that's how Yeah,
I understand now no spoiler alert. We're watching that again
(05:01):
a little bit, just because what we've been watching is
and just finishes I'll be Gone in the Dark, the
great documentary about the Golden State Killer and Michelle McNamara's
research and dog in Pursuits. I'll be Gone in the Dark.
Is it Netflix? No, it's hbom X, but it's it's great,
but it's so heavy. We will then cleanse the palette
(05:22):
with reruns of what we do in the Shadows, very smart,
the Great Palate Cleanser, which is what I'm gonna do
right after we record this. Okay, have you done stalling now? Yeah.
So one of the things that really kind of gets
people about inflation is the idea that like, if you
go back to the sixties. Yeah, the good old days
(05:42):
you could buy like a brand new car for like
three grand, brand new car, and that's when they made
them big and shiny. Yeah, you want to and very unsafe.
Do you want a house? All right, give me, I
don't know, it's yours. And that's a nice house to
very nice house. Like a ticket to a movie cost
a dollar. Now, if you pay a dollar to see
a movie, you have to see something terrible like Hidalgo
(06:04):
or national Security or something that's like a dollar movie.
Today this is like good movies. Yeah, the dollar movies
were a penny, right, Yeah, basically, so, um, all of
this sounds like it makes it sound like the good
old days were just this cheap, idyllic paradise. But that's
just not the case because of inflation, where you can't
really compare today's you know, cars, or today's houses, or
(06:30):
today's movie ticket prices without using an adjustment for inflation. Yeah,
because I think in nineteen sixty seven, if you were like,
if you made a lot of money, you made about
nineteen thousand dollars a year. That was a lot of money. Yeah,
sixty of American households earned less than eight thousand three
dollars a year. Uh, and so yeah, I mean they
(06:54):
have all these inflation calculators is one of our favorite
things to do. Let's go look at inflation calculators online.
West Egg. Yeah. West Egg is when I use mostly,
but there are a couple more because I think one
of them sometimes doesn't go back far enough. But honestly,
when it goes back too far, it's just a little
bit of like, I don't know, this seems about right right, Well,
that was the thing. Do you remember when when I
(07:15):
can't remember, we were talking about but it wasn't too
long ago, and I was saying, like, I don't think
this fully captures that this adjustment for inflation. I think
things were cheaper where things were more expensive. And that's
the point of of like tracking inflation is to say, actually, yes,
things were more expensive back then. Things do actually get
(07:36):
cheaper over time because technology becomes more less novel and stuff.
So for example, like a TV, like if you wanted
to buy a new color TV when it came out
in the sixties, Um, you paid probably about a thousand
dollars for that for that TV, right, that's a crazy price.
Back then, it was an enormous price. Like you would pay.
(07:56):
That would mean then in today's dollars that you would
pay something like ten ring in for a new TV. Yeah,
and TVs when they first started coming out with the
new flat screens were really expensive. And then, like you said,
that technology gets better and they get cheaper and cheaper
and cheaper. Where now you can get a I mean
it depends on what kind of flat screen, but you
can get a good flat screen for five bucks. Tops
(08:20):
in a decent one for five bucks. I mean you
walk into cost because they just give you one for
walking in, and it's huge. They're huge, they're much better,
They're enormous, they're lighter, they look better, and they're cheaper.
I think like a TV today, like the sixties TV
is about twenty of that how much it would cost
the person buying that color TV. So all of this
(08:42):
kind of goes to say like prices may go up
over time, but they actually relatively might actually be going
down too, or they could just be going up. Thankfully,
there are people who track this kind of stuff because
when you look at inflation, when you look at the
cost of price, the eyes of prices over time, that's
what inflation is. One way to put it. Yeah, overall prices,
(09:05):
goods and services. It's not just like, oh, gases a
lot for the next three months because the summertime. That's
not inflation, right, right, It's more like Hubba bubba costs
way more today than it did when we were kids. Sure,
that's a good example of inflation, but it's a general
rise in prices. And if you track this stuff, you
can actually track allegedly the health of your economy and
(09:27):
make allegedly good decisions on how to juice that economy
to keep it going at a steady, controllable rate, but
ever upward, right, which is what the FED does. Uh?
Did we do one on the Fed or we just
danced around them a lot? I don't remember. I know
we've done one on currency, how much money there is
in the world. We do one on stag inflation, which
(09:50):
will mention in a few I thought it was groundbreaking.
We did a whole Remember when all the rage was
those uh super stuff guides, Yeah, the super Stuff guide,
the audiobooks. We do one on economics. Remember that guy
who was like chicken. He kept using chicken as an example. Really, yeah,
he was great. And then yeah, there it was a
good It was a good listen if you ask me, Okay,
(10:13):
I'm glad those didn't become a thing though why I
don't know. It's a lot of work for Jerry and us.
And Jerry loved it, No she didn't. She keeps asking
when we're gonna bring those back. So there are a
couple of There are a couple of ways to look
at this. And it's funny, how like when you look
at most of this stuff, economists don't all agree. There's
(10:33):
a lot of chicken in the eggs stuff going on. Yeah,
exactly where it's like you're just saying the same thing
in a different way. It's still the same thing. And ye,
And this is sort of the first example which is
all maddening, isn't it. It is because some people say,
you know what, in a free market, in an open market,
it's just supplying to man like it always has been. Uh,
(10:55):
if the product has is greater in supply, it's gonna
go up in price. Uh. If it's greater than demand,
and prices are going to go down. And it's really
just as simple as that for these products and for
money and cash. And some people say, well, no, that's
not true at all. Uh. Inflation is the thing that
happens first. And you don't increase the supply of money
(11:18):
beyond demand because some people say, oh, well, the Fed
just increases the supply of money, right, and they did
it too much, and now prices are going up because
another way to put it is not just that prices rise,
but that inflation actually is a decrease in the buying
power of the dollar. Yeah, which is again, I know,
the exact same way to say this the other one
(11:38):
I know, but it's like the nuance of nitpicky. It
really is very nipicky. But we're talking macroeconomics for like,
you know, the money of three million people, and like
how it kind of moves and interact. So like if
you could figure this out, if you could just kind
of crack the code, I mean, but you can't. You
can do anything they haven't been able to so far.
(11:59):
And inflation a really good example of that, because nobody
can agree on exactly like you're saying, what causes it.
So one way to look at it is is that
you can split explanations in a couple of ways. Is
it based on a change in the demand or the
cost of goods or services or the products or is
it because of money? So the first one is that
(12:20):
money thing where there's too much money on the market, right,
which just if you don't get into economics, that just
sounds like a mind numbing thing to even think about,
but it's it's really simple to understand. Money is just
like anything else. If there's a lot of money, there's
a big supply, that means anybody has it who cares,
which means that there's um less value to it. Yeah,
(12:41):
and that's not just cash in circulation, it's cash and credit.
It's like everything we think of is kind of like
buying power, I guess. Yeah. And another way to look
at it is if there's a lot of money on
the market, that means the average person has more money
than usual. That means that they can buy more stuff
than usual. That means that more people are requesting, trying
(13:02):
to buy demand, right, more goods than they usually are.
So if demand is increasing, that means there's like more
That means prices will rise, which means it costs more
money to buy those things. And a good way to
put it is that there's um lots of money chasing
fewer goods. Yeah, that's how that's how that one's explained.
(13:23):
That's one explanation for inflation. There's too much money, which
causes prices to rise because there's more people trying to
buy those goods than usual. That's right. And the I
think one example here, Professor John T. Harvey at TCU,
He's who I was talking about earlier. He's like, no,
that's not really true. He says inflation happens first, and
(13:45):
that they don't increase the supply of money beyond demand
because that you wouldn't need you need more money because
prices are going up. So then that brings more money
in the market. Right, that's right. Growth accompanies the inflation,
it doesn't cause it. Yeah. So again this is all
these economists are saying, no, there's too much money, and
this guy is saying, no, the prices are rising, which
(14:07):
brings more money into existence. And in the meantime, everyone
else in the room is like, I gotta go to
the bathroom, I gotta go take a call, I gotta
go finger foods. Yeah, and we say it every time.
But the fact that you have liberal economists and conservative
economists that right there is that reveals it all. It's
all made up. It's all who do let's take a
break on who do you That's nice little cliffhanger. That
(14:30):
was my signal, and we'll come back and talk about
two other theories that are kind of the same thing
right after this. So Chuck is want to say, you're
(15:06):
doing great, Well, that's because I haven't gotten to those
paragraphs yet. It's gonna be just easy, okay, okay. So
there are another couple of theories. Again, economists are gonna
agree and disagree about these two theories. They are the
cost push theory and the demand pull theory. It's even
right there in the title push and pull. Essentially, it's
(15:28):
the same action going on, but one is choosing to
look at one side and one's choosing to look at
the other. So cost push means that it's the increase
of uh, the cost of like labor or the cost
of raw materials. Uh. Basically anything that's gonna end up
getting like a loaf of bread on a shelf, including
like the fuel for the trucking and packaging and all
(15:51):
that stuff. That that is what is going to push
up in prices. That that is the driver of inflation,
which makes a lot of sense. Like there was apparently
right now, I don't know if it's still going on,
but it definitely was the spring. There's a shortage in
wood in lumber still happening, okay, because of at least
(16:12):
in part, the wildfires that California suffered last year were
so devastating that it actually affected the national supply of lumber. Yeah,
and I also read that the lumber people decreased production
overall because they thought because of the pandemic, they thought
there was going to be a big lull. They didn't
want all this extra inventory on their hands. It turned
(16:34):
out everyone was like, no, I want to build stuff now,
and they dis miscalculated. So it's not a good time
to build a pavilion at your family camp. Let's just
say that, right, or to try to increase the housing stock. Right.
So that means then that lumber going up in price
makes building a new house that much more expensive. So
(16:55):
the house, the finished product, has become more expensive because
of the input that raw material lumber. That's a really
good example of cost push theory of why prices are
rising because of something downstream in the production process. Yeah,
but there's a key little factor here. All of this
is true, Uh, when companies are running already at full
(17:18):
production capacity. So that's a really key element there. It
can't be a company that's um like behind or whatever.
It's like it's a company that's just humming along basically,
and then something happens in the supply chain, let's say,
big increase in fuel or lumber cost or any kind
of raw material. I think did Dave help us with this?
(17:38):
This is a Dave How Stuff Works article? Okay, yeah, wow,
I know, hats off. We found another one. But he's
as bread as the example. At the cost of wheat
goes up, the cost of flower is obviously going to
go up, and the cost of bread is eventually going
to go up under the uh the CP theory, and
so people like you and I end up paying more
(18:00):
for a new house, or more for a loaf of bread,
more for whatever, because something somewhere that was a component
in that caused this rise in prices, that would cause
that would that's the cost push example of theory of
of inflation, the kind of opposite of that. But I
(18:20):
don't even know the right word. They say, no, no, no,
it's not the raw materials that um cause the increase
in prices. It's actually the demand for that finished product
that that that causes the increase in prices, and so
housing right now actually is a really good example of
both cost push and demand pull at the same time. Yes,
(18:44):
it's crazy, and it's also demonstrating like, okay, we have
no idea what's going on, or at the very least,
that these things don't exist in isolation, and that is
that people like you're saying there the pandemic, We're like, no,
we want to move. I don't want to live in
the city anymore. I want to live as far away
from other people as possible, but but only as close
as instat cart will deliver. That's as close as I
want to live to the web van. Sure, yeah, um
(19:09):
so uh it was totally unpredicted. But the upshot of
it is that there is a lot of people trying
to buy houses right now and the housing markets just
gone through the roof, and so that's caused housing prices
to increase, and it's caused like all of the other
components of the housing market to increase as well. So downstream,
(19:32):
that demand for houses caused every bit of housing to
increase as a as a result. Yeah, and the example
Dave to stick with the bread as well. Because it's
a I think it's slightly easier to understand than the
housing market because it's so weirdly affected by a lot
of things. Right now, is that if the cost of
(19:53):
or if a lot of people want bread, the baker
doesn't immediately raise the prices because of that demand, um
until they run out of the flower. Then they got
to go back and buy more wheat, and the wheat
farmer might say, well, now it's a little more expensive. Yeah,
there's a lot of bakers who are have everybody wants
my wheat right now, and so that's when the cost
is eventually pulled and uh and then increased I guess
(20:16):
for the consumer. Right So it looks like if you're
just looking at it, like oh this this wheat price,
this raw material rose in in cost and that caused
bread to rise, and people are like, no, no, that
that's an illusion. It was actually this demand for bread
that increased that caused the wheat to rise. And again
it sounds so similar to cost push demand pull does
(20:39):
that it doesn't even matter, but it really does matter.
It does matter because and this part is the key here.
If you're at home and you're just like stop talking,
this is what kind of drove at home for me,
the difference in those two it might seem like just
words and nitpicky, but it's really not because in one
scenario and demand pull, you've got an economy that's really
humming and people like I want to buy all that stuff. Yeah,
(21:01):
it means a lot of people have a lot of
money that that they want to spend and that yes,
that means like you have a healthy economy, right then, right,
and under cost push, it's more like hey, uh, people
feel like they have to do this repair on their
house and I'm sorry, it's just a lot more expensive.
It's not like oh I need this new thing. It's
(21:22):
like I have to pay for this thing and it's
a lot more expensive because of the raw materials or whatever.
The labor has gone up, right, And and yeah, it's
much worse because that means, like you said, the company
is humming along at max capacity, and all of a sudden,
it's like we don't have wheat anymore, and we aren't
gonna be able to satisfy demand because we don't have
(21:42):
this basic component. It means that there's something broken in
your supply chain or the mechanisms of production and that's
not a good place to be in. So it's very
healthy economy or everybody has money increasing demand or demand
increases because you can't supply the basic parts to to
create those goods. Right, Okay, I know the beginning of
(22:05):
this part, so I'll take it, and then I have
a cot set up in the next room. I'm just
gonna go. I feel like you're setting me up for failure. Now,
you'll do fine because there's no math. Well, there is
math involved, but you'll still do fine. Where is their
math involved? Uh? In this part the annual rate of
inflation calculation. So but if if we get it wrong,
(22:29):
we'll just say Dave got it wrong, we'll pass that.
We'll cost push it his way. So we're talking about
how inflation is actually measured now, and uh, this is
a big deal because we like to keep track every
year and say that you know, inflation, what is it?
Usually between about one and a half percent to three
and a half percent annually in the US generally, unless
(22:50):
it's like the nineteen seventies or early eighties. I think
over the last several years it's gone between negative two
point one well in like five something per cent, which
is pretty five points. Something is pretty high. It's generally
in the two to three range. It is for our experience,
but in the early eighties it was as high as
(23:10):
almost that's bad. It was very bad, but not as
bad as like why Amar Republic Germany or in which
we've talked about a million times, where their hyper inflation
was just out of control. Yeah, wouldn't. We'll get to that, okay.
So we have to measure the um the inflation rate
because we like to keep tabs on our economy so
the FED can can do their weird black magic. And
(23:33):
so the Bureau of Labor Statistics the BLS, is who
kind of sets this stuff by working through a big
data collection system called the Consumer Price Index. It's nuts,
it is nuts how big it is. They take, Uh,
what they try and fill up is what's called the
CPI market basket. And it's basically, if you imagine a
(23:56):
grocery basket that includes everything everything basically like eighty tho items. Yeah,
I'm not just groceries. They have two hundred categories of
products in eight major groups food, housing, apparel, transportation, medical care, recreation, education, communication,
and then other which is basically everything else, uh, funerals
and manicures basically the other and saunas sounds. Yeah, definitely
(24:21):
that might be under recreation you think, I think it
might be or medical care. It's good for you, Yeah,
for sure, depending on how progressive your your Bureau of
Labor Statistics agency is at the time. That's right. So
every couple of years, thank you for waiting until I finished.
The Bureau of Labor Statistics interviews twenty four thousand American
(24:43):
families on the stuff that they bought. Yeah, because if
you have if you want to figure out what eighty
thousand items you need to include basket, you have to
find out what Americans are actually buying. Yeah, I bought
you a slide whistle. That's right. They called me up
and I said, I bought a slide whistle. That's the
only thing about this year. They said you're the one,
and they said that must have been for a very
special guy in your life, and it said it's true. Wow,
(25:05):
I'm blessing right. Uh. Then they have another twelve thousand
families that are keeping a spending diary. Basically it's kind
of like Nielsen a little bit. For that one. They
did kind of remind me that a little bit because
they're just trying to get a big broad overview of
what a typical schmuck here in America spend. And you say,
where's my three or five dollars? And they just go ahead,
(25:25):
they hang up real quick exactly somebody else. Uh. And
then every month they have a big team of assistance
that records the prices of those eighty thousand things. And
this is an effort to get just a good look
at what that big market basket looks like. Yeah, so
two years they figure out what they need to be
buying or what Americans are buying. They use that data
(25:46):
for another couple of years, but every month they go
and price all items in that that market basket every
single month. If you get a figure out inflation, you
got to be as current is possible. Yeah, So the
to figure out what item needs to be in the basket.
So there's like two d categories, eight broad categories, two subcategories.
(26:11):
So like transportation will have like auto insurance category subway
exactly m or food will have like you know, cheese
will be one. But in that cheese category sample, I
think they call it, there's you know a bunch of
different kinds that everybody buys like Kraft singles. Some are
Velvita slice. People like me, man, I used to love Velvita.
(26:34):
It's still good. I have it, had it in decades.
I will buy you somebody. Do you get blocks of Lvita? No,
we don't get blocks of Lvita. You get slices now, Okay,
but it's not cheese, right, and the cheese product perform cheese,
but I think it's still qualifies under the cheese sample
in the market basket that but if you're making a
chili cheese for something, you got to use it. Sure, yeah,
(26:55):
that's good. No, but this is it's good for grilled
cheeses to of course, so um that particular brand, but
not just that brand, like the you know, sixteen slice package.
They find it makes up sevent of the market for
that type of cheese. So they'll pick that one. They
use that for four years and then they go reevaluate it.
(27:17):
This is like the level of detail the BLS is
putting into their their basket. And so they take all
of this and they price it. Every single month. They
literally go to the store and I meant to say
literally that time and say, oh, well, the Velveta Cheese
slice sixteen pack is three forty nine, right, now, write
(27:37):
the price down. I think so, And then they go
back and they type it it and every month they
say this is how much that this cost and they
compare it strangely too. Right. Take it from here, Chuck, Well,
two was basically, uh was that was the baseline year
(27:59):
where they said, all right, here's our CPI index. It's
not an actual um it's an index. It's not a
dollar figure. I know, I looked everywhere. I'm like, how
much does that eight thousand, you know, item basket cost
in real dollars? Everything? Every they won't sorry, index buddy, Yeah,
they'll talk about UFOs sooner than they'll tell you how
much is in that basket? How much? So eighty two
(28:23):
is when that baseline figure was set, which was the
Consumer Price Index is a hundred uh in two thousand six.
It hit two hundred in April two thousand six, which
basically at that point they should have said, they should
have just reset it and said we have a new
base here because we doubled it, and they didn't know.
They just and I'm not sure why really they just
(28:44):
sort of left it in two. It seems like a
maybe they're just used to that math, it seems like
it would be a lot of extra math. And it wasn't. No,
it wasn't that they doubled it. It was that it
was the exact same in two I think. Or was
it that they doubled it. No, it was doubled. But
they said they should. I mean, some people say they
(29:06):
should have said like, all right, well we have a
new base, but they're still using the two. I guess,
I just I just don't know why. I don't either why.
Maybe it makes perfect sense. So so the actual um
number that they come up with is a number that's
relative to the amount that it costs in night two. Yeah,
(29:26):
this is where I kind of got a little foggy.
So for example, and that I mean, I fell asleep
on my debts in in two thousand nineteen, the c
p I, the consumer price index for that basket of
goods was two nine point to T two, okay, meaning
that that amount of goods cost almost two and a
(29:46):
half times what that same basket of goods would have
cost you in nineteen eighty two. Sure, so you say, okay,
I don't care how much it costs in nineteen eighty two.
I want to know how much it's affecting me now,
and they said, we'll just set a now, settle down.
They can take that number and say, well, how much
was it last month or how much was it last year?
So they can compare, say like the two thousand nineteen
(30:08):
and two thousand twenty c p I s and find
that there was a difference of something like about three
point oh two six between those two numbers. Then they
divide that by the two thousand nineteen percent um number
and they get the actual percentage that says the cp I,
the consumer price index, the amount of basically what it
(30:29):
cost people to just live in two thousand nineteen was
one two percent less than it costs in which means
that inflation rose one between and two thousand nineteen. Right,
And when you hear about inflation annual inflation rate, that
is generally what people are pointing to. But as we
(30:51):
will see, that is not how everyone likes to look
at inflation. There are other things to take into consideration.
I think the FED like to look at core inflation,
which is that CPI minus uh volatile things like food
and energy, things that like the prices kind of go
up and down uh more volatively. Sure is that a word, yeah, molybdium. Yeah. Uh.
(31:18):
And then the FED also looks at another data set
compiled by the pure the Bureau of Economic Analysis. This
gets a little wonky, but it actually does make sense.
The difference between the BLS and the b e A
indexes uh comes down to the fact that if chicken
costs a lot more money all of a sudden because
of some supplies or shortage or whatever, or increased demand, rather,
(31:41):
then people might go to the other white meat and say, well,
I'll start buying pork then. Yeah. That was explained by
Benjamin apple Bomb from the New York Times Economics blog
Benjamin Okay, yeah, he said, I swear to god I
nailed the apple Bob apple Bomb Okay, yeah, that's my
imaginary friend, Binjamine apple Bomb. Um. So uh he was.
(32:05):
He was explaining it like that, that that's the difference
that people adjust, Like we're not just like automatons were like, Okay,
well we're buying chicken and that's all we eat, and
we also buy X amount of hot dogs. It's like, yeah,
if the price of chicken goes up, you're gonna eat
something else that month. That that's just how people do
and so he was saying that the Bureau of Economic
(32:27):
Analysis really is much better at taking that into consideration.
And so since about two thousand, the FEDS kind of
relied a little more on that one than the c
p I. But the CPI is still very much the
most broadcast one. But it turns out that economists used
whichever one suits their needs and politician given month to
say our policies are right and your stink. That's a
(32:50):
great place for a break, and we'll come back and
talk about why inflation even matters and what we can
do about it, which is nothing right for this? All right,
(33:25):
So we're back to wrap this up. This wasn't as
bad as This wasn't as bad as I thought. Why
is it funny? I'm just I'm glad we're reaching in here.
I'm glad to see that you've come around a little bit.
You did great explaining everything. I appreciate it. So. Uh,
strength of Dave's research, I think, sure, not like the
John Mirror person. Dave's wonderful his work, he is, He's great. Uh.
(33:50):
So inflation can be a bad thing because of some
sort of obvious things. But one is if you have
a fixed income and you're living off a pension or something.
A lot of times, most times that pension isn't going
to go up because inflation goes up. Luckily, social security does.
It's tied to that CPI UM, which was a really
(34:13):
smart thing to make people like not absolutely loath social
security in every way. But yeah, social Security will go up,
but your pension won't. So that's a big deal. And
that's why inflation matters. Yeah, I mean it also stinks
for those of us who are like, man, I'm paying
way more for bread than I was this time last year,
and why should i? Um. It also has an effect
(34:36):
on investments too. Um. Remember, a different way of looking
at inflation is not just that prices are rising, but
that the buying power of the dollar is going down. Yeah,
so your investment, Yeah, if you have an investment is
worth ten grand. Uh, you know, five years from now,
it's still the dollar amount, still worth ten grand, but
the value of the dollars far less than it was
(34:58):
five years before, and so that ten grand just doesn't
amount to quite as much. Another thing that can happen
is your interest rates might go up or uh not.
Your interest rate role reset. But if you go to
buy a house or something. The interest rate might be
higher because a bank might say, you know, I think
inflation is gonna be pretty bad this year, so we're
(35:19):
gonna we're gonna have to charge more money on that
loan because we're losing that dollar value, right exactly, and
banks don't like losing money. Um. There's also like a
lot of uncertainty that could come when inflation is going on.
Remember I said inflation, Like, there are a lot of
inflation fears until today. Um. That has a really deletrious
effect on business in that Um, they don't it's harder
(35:42):
to plan for the future. They don't know how much
the cost of the goods that they need to make
their finished products they're going to be, right, So you
don't know, you know, if you're gonna buy a whole
bunch of you know, meal worm spray for your your
flower to make bread with. Um, is a better to
buy it now? Is it better to buy it later?
And how much am I going to price? Has spread
(36:04):
for it's it's just a catastrophe. And then they eventually
just give up and go home and watch Judge Judy. Yeah,
I gotta say that's um. Like with Emily, small business
that I think, especially with small businesses, she can't just
be like, oh, well, shipping is a lot more now
because fuel costs are going up or packaging is increases.
So she can't just raise and lower her prices willy
(36:26):
nilly when you're a small business selling soap in lotion
and candles, Which is funny because that is one of
the major explanations for inflation. I know, but you just
can't do that as a small as you can be
like our soap a quarter more all of a sudden,
or a quarter less, like she kind of a lock
in for a little while. Like a price increase for
a small business like that is sort of a big deal.
(36:49):
You got to really think it through. Yeah, yeah, I do. Um.
And that's actually another problem with it too. It's like
if if Emily can make less money um selling her wares,
but she's paying more to make them, her profit margin declines.
In that sense, she might have less to expand um
(37:10):
to hire more people total, and so that has a
ripple effect through the economy where it can affect employment.
Higher prices can actually lead to lower employment. Yeah, Like
she gets killed on shipping, that's her big one, Like
she loses money a lot of money every year on
shipping costs. But you can't just like she's not Amazon,
so she can't can't ship for free, and you can't
(37:31):
also charge what it really costs to ship. You just
have to kind of take the hit. Yeah, you know
it's interesting. Uh. I guess we can talk about hyper
inflation a little bit. We've covered it a few times
over the past thirteen years. But the one big one
that people always talk about is, like you mentioned earlier,
the Weimar Republic of Germany when the mark exploded from
(37:54):
two thousand marks to the US dollar in nineteen two
to four point two trip alien marks to the dollar,
uh less than a year later, And that nuts. That
is I mean, you can't even wrap your head around
and remember in Zimbabwe and that I can't remember what
what decade it was, the eighties, maybe the nineties where
they were they were like using wheelbarrows to cart trillion
(38:17):
dollar bills um to the grocery store and still could
barely buy bread or toilet paper with it. Yeah, the US,
like I said earlier, it had its own brush with
I don't know if you call it hyper inflation, but
definitely much higher inflation than anybody was comfortable with UH,
and that actually came I was researching this today. A
lot of people blame the UM, the opeque, oil embargo, UM,
(38:41):
a lot of other stuff, but it apparently can all
be laid at the feet of Richard Dixon, who juiced
the economy. He fired his FED chairman and replaced him
with a sycophant who had no formal economics training, and
then started telling him what to do. Sound familiar to
juice the economy to get reelected. And it worked for
a minute, and then all of a sudden, it was
(39:02):
like this plane going up and then the gas was
no longer in the fuel injector and started just tumble
back towards the earth. We had almost um uh inflation. Yeah,
I mean that unemployment. That's a real number that like
makes an actual difference in American families, like getting what
they need, Yeah, for sure gas and food and you know,
(39:23):
paying builds. Yeah. So it took a good decade or
so to come out of that death spiral that it
was in, and it took the FED. And this is
a this was actually a big reason why the FED
plays such a big role in the economy today is
because of that the FED had to step in and
basically do the opposite of um easy money and basically
(39:44):
get money off of the market to basically say, all
these people who have money right now, we need to
take some of their money to lower demand, to cause
prices to go down. And it was a really hard
time to be an American in the late se in
these early eighties because it caused this, uh, the Great
Inflation and then a pretty big recession. Yeah, there are
(40:06):
a few things that the FED can do to uh,
you know. One thing that you might see on stupid
Facebook comments is like, just print more money. Fed. That's
all they do anyway, just put more cash into the economy.
They don't do that. The FED doesn't just print more money.
They can influence the money supply though, in a few ways.
(40:28):
One is there's something called the reserve requirement, which is
basically they say, you know what, if you're a bank,
you have to have a certain percentage of your customer
deposits that you don't you can't touch. You gotta leave
it in there and reserve. So they can lower that
requirement a little bit, meaning that in theory, more money
can be in circulation because they're loaning out more or
(40:49):
they're able to loan out more. So that's one thing
they can do. Um. They can also uh, they actually
buy and sell bonds. This is where it gets so
crazy to me, Like this just sounds so weird, but
I mean there's a whole market there that actually is
basically how money gets on or off the market in
the economy. There's this, there's sales of bonds where companies
(41:12):
can buy bonds, companies can sell bonds um, and the
FED will buy or sell them too. And when the
FED buys bonds is putting money on the market, and
when the Fed sells bonds, it's accepting money. It's taking
money off the markets, treating those bonds for money, and
making sure that that money isn't in circulation anymore, at
least temporarily. That's what's happening today. They're going to auction
(41:34):
off a hundred billion dollars in bonds, So a hundred
billion dollars will not be in the economy tomorrow after
this auction today because the Fed's taking it off the market,
which was enough to um to calm those inflation warries.
Everybody's at uh, the FED steppinge in, It's fine. Well,
now they're like a hundred people that understand that said,
(41:55):
oh okay, and everyone else just read the headline. T L. D.
R right said all right, we're not supposed to worry,
so I won't worry. But at the same at the
same time, you made reference though earlier that it was
like Joe Biden screwing up the economy, that they were
blaming those stimulus checks for everything from people not working
purposefully to um there being too much money and increasing
(42:18):
demand for regular stuff, and the whether that's true or not.
The FED stepping in and saying, well, we're just gonna
get some money off the market. Another thing the government
can do is the opposite of something like stimulus checks.
It can actually raise taxes. And that's another way for
the government rather than the FED to get money out
of circulation by by taking it from people's you know,
(42:41):
end of your account, end of your account. Uh. And
then the other The final thing the Fed can do
is they can lower their discount rate, which is the
rate that is going to charge a bank for a
short term loan. And in theory, if a bank is
paying less for a loan, then they can lend at
a lower rate as well. If you're going and skiing
for a loan. And then lastly there's supply side economics.
(43:03):
Another thing the government can do, which is basically deregulate
industry in the hopes that it will make industry leaner,
more competitive, all that stuff, and that that will cause
prices to go down because businesses will become more efficient
when it's dog eat dog. I think we've seen, thanks
to reagonomics, that that doesn't necessarily work very well. That's
what they say. That's my two cents, And hey, man,
(43:26):
I'm just as much an economist as any economist. It
sounds like it. Uh. If you want to know more
about economics and inflation and stag inflation and deflation and
all deflations, go do some research and it will blow
your mind. And since I said that it's time for
listener mail, I'm gonna call this one of the many
(43:46):
great responses from our Girl Scout episode. Good morning, Josh
and Chuck at the pleasure of listening to the Girl
Scout episode. When I was sewing the badges onto my
daughter's best in time for our bridging ceremony. My daughters
our fourth generation Girl Scouts, and I'm a third generation leader.
I love this very big family. I have the honor
(44:08):
to service one of five leaders and a multi level
troop or troop as girls from kindergarten through seventh grade,
encompassing Daisy, Brownie, Jr. And Cadet levels. We formed as
a multi level troop so sisters could be in the
same troop. That's really sweet, and so that their parents
could have one troop to keep track of. It's a
great way for the older girls to practice leadership skills
(44:28):
with the younger girls and gives the younger girls role models.
This sounds great, very sweet. They should do this everywhere
everyone else is doing it wrong, she said, But no
Juliets are allowed. Yeah, no, Juliet. Another unique thing about
our troop is that we do not charge dues. Everything
our girls do from uniforms, program supplies, and activities are
funded solely through cookie sales. We asked new girls to
(44:52):
buy their first vest for the uniform and from their
cookie sales take care of the rest. Uh. Caroline here
leads the Daisies in their troop and says, even at
the youngest levels, the emphasis is then a girl that experience.
That means they choose their activities and badges, plan and
run the meetings, practice leadership skills. Each chance they get
(45:13):
takes a lot of practice and self control in the
part of the leaders to give the girls space to lead,
but the end result is so rewarding. I will leave
you with one last lesson that I've learned in Girl
Scouts and a motto that my family has always lived by.
This is great. This is what everyone should do. Leave
a place better than you found it. Oh yeah, whether
it's cleaning up a little extra garbage at campsite or
(45:35):
making a positive impact on the people in places you
come across in life, leave it a little better than
you found it. Thank you for all the many years
of podcast that are brightened many a dull car ride
and countless rounds and towards from my family, except for
the inflation episode. That's weird. How do you know? So
that is from Caroline and rich Field, Minnesota, and she's
(46:00):
send in pictures of the daisies and the girl bridging
ceremony and it's just adorable, these cute little girls in
their masks doing stuff. Yeah, who is that? That's Caroline? Caroline?
So I thought, thanks a lot, Caroline, was some great info.
I'm glad you enjoyed that. So we enjoyed it too.
(46:20):
Um and uh, I guess it's a hunt Chuck. Yeah,
I should point out she wrote back and said, by
the way, my husband is gonna be jealous. I'm getting
this on listener mail. I should mention that he went
through boy Scouts all the way through high school just
so he could go camping. All he did was enough
to get the badges so you could qualify for camping trips.
It's awesome. So the rest of them, he said, we
don't need no stinking badge. Uh. Well, if you want
(46:43):
to get in touch of this, like Caroline did, you
can do that via email. Send us one to stuff
podcast at iHeart radio dot com. Stuff you Should Know
is a production of I Heart Radio. For more podcasts
my heart Radio, visit the heart Radio app, Apple Podcasts,
or wherever you listen to your favorite shows. H m
(47:10):
hm
Welcome to Stuff You Should Know, a production of I
Heart Radio. Hey, and welcome to the podcast. I'm Josh Clark.
There's Charles w. Chuck, Wayne Waynester, Wayne Train, what what,
Wayne Bryant, And there's Jerry Jerome Roland over there, and
(00:24):
this is Stuff you should Know. Yeah, kill me episode whatever, dude,
this is fine. I was going to say that, I
know it's again. We just did an economics episode. What
was it. I don't know, but I think economics is
literally right there. Besides, like chemistry and physics for me,
now maybe worse because at least those are interesting to me.
(00:44):
Chemistry and physics still make sense because they're really hard
to understand. Economics doesn't make sense because it's b s
and it's just that's key to understanding economics. I'm good here,
I'll tell you where I'm gonna need help. I'm good,
except for like were paragraphs right there where it says
kill me, it really does, think kill me right there,
(01:05):
and then right there where it says wake up listeners. Whatever,
I'm good. I'm gonna need your help there the rest
of it, this is a personal challenge to keep everyone interested.
That's funny because on the John Your document. I have
blah blah blah over there. Oh boy, are seeing how
(01:25):
the sausage? That's like year one stuff. Dude, No, we've
been doing that forever. I think we generally are into
one another's topics. Yeah, it's not the topic, and I
think economics is boring, is heck? I don't think he
was what we'll talk about John here in the John
Your episode. How about that? I was about to defend
my position on well that have already been out. I
(01:46):
don't know, man, we'll find out. I think people should
play these back to back. So you should, especially the
Cleft episode, because the listener mail from the Cleft episode
really sets up some of the jokes in the night
Trap episode that follows. So don't listen to those two. Well,
those are too fun to listen to. I think listeners
listen to these two back to back. It's like Thilman
(02:09):
Louise territory right into the Grand Canyon. What does that mean?
Have you never seen Tholm and Louise? I have, but
I don't get how it applies to listening to these
episodes out of order spoiler alert for Tholma and Louise. Everybody,
Oh you already kind of in the Grand Canyon. They
drive into the Grand Canon at the end, just straight
off that cliff, And that's what would happened if they
(02:31):
listen to both of these episodes back to back. Well,
i'll tell you what. If you watch Thelma and Louise
as their drive, it really is as they're Actually I've
only seen the last ten minutes. Yeah, really, you're like,
what was their problem? Yeah? Why they do that? It
seems a little overreacting. Um the the if you listen
(02:53):
really really closely, I mean, like, turn your volume up
so loud that you can hear the fawse of the video,
the grain of the video making it sound, you can hear.
I can't remember who's Thelma? Oh why do you ask me?
I always get these two confused. Right now, Gina Davis
is Thelma? I thought she was Louise. Okay, Jerry's got it.
(03:13):
Jerry so mad right now? So so it is Tholma
is Gina Davis says, It says to Louise, well, we
can thank John you're for this beautiful view on the
way to our deaths because no one else cared about
the natural environment. That's actually absolutely right. He's still alone,
(03:34):
No one thought the way that he thought. So we're
talking about inflation. Obviously that was the most fun part
of this episode. But no, it's not. Chuck. I refused
to believe that we're talking about inflation. And the reason
that I picked this is because inflation is kind of
a thing right now. There's a lot of fear until today, Yeah,
I think until today, Um, when the fag came out
(03:56):
and said, everybody, calm down, stop being dramatic, Joe's ruining
the dry there's not going to be an inflation fear
or there's not gonna be inflation. Stop your fears. And
as a matter of fact, um, the fear stopped. Everybody
stopped worrying about inflation because the fact came out and
said something. Yes. And but the reason I picked this
is because it's good to know what people are talking
(04:16):
about when they're like, uh, we should be really worried
about inflation right now. And all you have to do
is understand a few basic things, and all of a sudden,
you're in the convo, baby, sure, and we're going to
explain those few basic things to everybody. And then the
next time inflation starts to go crazy, you can say
everybody just calmed down. Yeah, it's just cost push going on. Yeah.
(04:39):
You you you'll be like, uh at every party you
go to, you can talk about that, and you'll be
the equivalent of Colleen Robinson. Who's that from what we
do in the Shadows? Is that the Energy Empire? Oh yeah, yeah,
he probably sits around and talks about inflation. Yeah. Yeah,
you threw me off with the Colleen. Well that's how Yeah,
I understand now no spoiler alert. We're watching that again
(05:01):
a little bit, just because what we've been watching is
and just finishes I'll be Gone in the Dark, the
great documentary about the Golden State Killer and Michelle McNamara's
research and dog in Pursuits. I'll be Gone in the Dark.
Is it Netflix? No, it's hbom X, but it's it's great,
but it's so heavy. We will then cleanse the palette
(05:22):
with reruns of what we do in the Shadows, very smart,
the Great Palate Cleanser, which is what I'm gonna do
right after we record this. Okay, have you done stalling now? Yeah.
So one of the things that really kind of gets
people about inflation is the idea that like, if you
go back to the sixties. Yeah, the good old days
(05:42):
you could buy like a brand new car for like
three grand, brand new car, and that's when they made
them big and shiny. Yeah, you want to and very unsafe.
Do you want a house? All right, give me, I
don't know, it's yours. And that's a nice house to
very nice house. Like a ticket to a movie cost
a dollar. Now, if you pay a dollar to see
a movie, you have to see something terrible like Hidalgo
(06:04):
or national Security or something that's like a dollar movie.
Today this is like good movies. Yeah, the dollar movies
were a penny, right, Yeah, basically, so, um, all of
this sounds like it makes it sound like the good
old days were just this cheap, idyllic paradise. But that's
just not the case because of inflation, where you can't
really compare today's you know, cars, or today's houses, or
(06:30):
today's movie ticket prices without using an adjustment for inflation. Yeah,
because I think in nineteen sixty seven, if you were like,
if you made a lot of money, you made about
nineteen thousand dollars a year. That was a lot of money. Yeah,
sixty of American households earned less than eight thousand three
dollars a year. Uh, and so yeah, I mean they
(06:54):
have all these inflation calculators is one of our favorite
things to do. Let's go look at inflation calculators online.
West Egg. Yeah. West Egg is when I use mostly,
but there are a couple more because I think one
of them sometimes doesn't go back far enough. But honestly,
when it goes back too far, it's just a little
bit of like, I don't know, this seems about right right, Well,
that was the thing. Do you remember when when I
(07:15):
can't remember, we were talking about but it wasn't too
long ago, and I was saying, like, I don't think
this fully captures that this adjustment for inflation. I think
things were cheaper where things were more expensive. And that's
the point of of like tracking inflation is to say, actually, yes,
things were more expensive back then. Things do actually get
(07:36):
cheaper over time because technology becomes more less novel and stuff.
So for example, like a TV, like if you wanted
to buy a new color TV when it came out
in the sixties, Um, you paid probably about a thousand
dollars for that for that TV, right, that's a crazy price.
Back then, it was an enormous price. Like you would pay.
(07:56):
That would mean then in today's dollars that you would
pay something like ten ring in for a new TV. Yeah,
and TVs when they first started coming out with the
new flat screens were really expensive. And then, like you said,
that technology gets better and they get cheaper and cheaper
and cheaper. Where now you can get a I mean
it depends on what kind of flat screen, but you
can get a good flat screen for five bucks. Tops
(08:20):
in a decent one for five bucks. I mean you
walk into cost because they just give you one for
walking in, and it's huge. They're huge, they're much better,
They're enormous, they're lighter, they look better, and they're cheaper.
I think like a TV today, like the sixties TV
is about twenty of that how much it would cost
the person buying that color TV. So all of this
(08:42):
kind of goes to say like prices may go up
over time, but they actually relatively might actually be going
down too, or they could just be going up. Thankfully,
there are people who track this kind of stuff because
when you look at inflation, when you look at the
cost of price, the eyes of prices over time, that's
what inflation is. One way to put it. Yeah, overall prices,
(09:05):
goods and services. It's not just like, oh, gases a
lot for the next three months because the summertime. That's
not inflation, right, right, It's more like Hubba bubba costs
way more today than it did when we were kids. Sure,
that's a good example of inflation, but it's a general
rise in prices. And if you track this stuff, you
can actually track allegedly the health of your economy and
(09:27):
make allegedly good decisions on how to juice that economy
to keep it going at a steady, controllable rate, but
ever upward, right, which is what the FED does. Uh?
Did we do one on the Fed or we just
danced around them a lot? I don't remember. I know
we've done one on currency, how much money there is
in the world. We do one on stag inflation, which
(09:50):
will mention in a few I thought it was groundbreaking.
We did a whole Remember when all the rage was
those uh super stuff guides, Yeah, the super Stuff guide,
the audiobooks. We do one on economics. Remember that guy
who was like chicken. He kept using chicken as an example. Really, yeah,
he was great. And then yeah, there it was a
good It was a good listen if you ask me, Okay,
(10:13):
I'm glad those didn't become a thing though why I
don't know. It's a lot of work for Jerry and us.
And Jerry loved it, No she didn't. She keeps asking
when we're gonna bring those back. So there are a
couple of There are a couple of ways to look
at this. And it's funny, how like when you look
at most of this stuff, economists don't all agree. There's
(10:33):
a lot of chicken in the eggs stuff going on. Yeah,
exactly where it's like you're just saying the same thing
in a different way. It's still the same thing. And ye,
And this is sort of the first example which is
all maddening, isn't it. It is because some people say,
you know what, in a free market, in an open market,
it's just supplying to man like it always has been. Uh,
(10:55):
if the product has is greater in supply, it's gonna
go up in price. Uh. If it's greater than demand,
and prices are going to go down. And it's really
just as simple as that for these products and for
money and cash. And some people say, well, no, that's
not true at all. Uh. Inflation is the thing that
happens first. And you don't increase the supply of money
(11:18):
beyond demand because some people say, oh, well, the Fed
just increases the supply of money, right, and they did
it too much, and now prices are going up because
another way to put it is not just that prices rise,
but that inflation actually is a decrease in the buying
power of the dollar. Yeah, which is again, I know,
the exact same way to say this the other one
(11:38):
I know, but it's like the nuance of nitpicky. It
really is very nipicky. But we're talking macroeconomics for like,
you know, the money of three million people, and like
how it kind of moves and interact. So like if
you could figure this out, if you could just kind
of crack the code, I mean, but you can't. You
can do anything they haven't been able to so far.
(11:59):
And inflation a really good example of that, because nobody
can agree on exactly like you're saying, what causes it.
So one way to look at it is is that
you can split explanations in a couple of ways. Is
it based on a change in the demand or the
cost of goods or services or the products or is
it because of money? So the first one is that
(12:20):
money thing where there's too much money on the market, right,
which just if you don't get into economics, that just
sounds like a mind numbing thing to even think about,
but it's it's really simple to understand. Money is just
like anything else. If there's a lot of money, there's
a big supply, that means anybody has it who cares,
which means that there's um less value to it. Yeah,
(12:41):
and that's not just cash in circulation, it's cash and credit.
It's like everything we think of is kind of like
buying power, I guess. Yeah. And another way to look
at it is if there's a lot of money on
the market, that means the average person has more money
than usual. That means that they can buy more stuff
than usual. That means that more people are requesting, trying
(13:02):
to buy demand, right, more goods than they usually are.
So if demand is increasing, that means there's like more
That means prices will rise, which means it costs more
money to buy those things. And a good way to
put it is that there's um lots of money chasing
fewer goods. Yeah, that's how that's how that one's explained.
(13:23):
That's one explanation for inflation. There's too much money, which
causes prices to rise because there's more people trying to
buy those goods than usual. That's right. And the I
think one example here, Professor John T. Harvey at TCU,
He's who I was talking about earlier. He's like, no,
that's not really true. He says inflation happens first, and
(13:45):
that they don't increase the supply of money beyond demand
because that you wouldn't need you need more money because
prices are going up. So then that brings more money
in the market. Right, that's right. Growth accompanies the inflation,
it doesn't cause it. Yeah. So again this is all
these economists are saying, no, there's too much money, and
this guy is saying, no, the prices are rising, which
(14:07):
brings more money into existence. And in the meantime, everyone
else in the room is like, I gotta go to
the bathroom, I gotta go take a call, I gotta
go finger foods. Yeah, and we say it every time.
But the fact that you have liberal economists and conservative
economists that right there is that reveals it all. It's
all made up. It's all who do let's take a
break on who do you That's nice little cliffhanger. That
(14:30):
was my signal, and we'll come back and talk about
two other theories that are kind of the same thing
right after this. So Chuck is want to say, you're
(15:06):
doing great, Well, that's because I haven't gotten to those
paragraphs yet. It's gonna be just easy, okay, okay. So
there are another couple of theories. Again, economists are gonna
agree and disagree about these two theories. They are the
cost push theory and the demand pull theory. It's even
right there in the title push and pull. Essentially, it's
(15:28):
the same action going on, but one is choosing to
look at one side and one's choosing to look at
the other. So cost push means that it's the increase
of uh, the cost of like labor or the cost
of raw materials. Uh. Basically anything that's gonna end up
getting like a loaf of bread on a shelf, including
like the fuel for the trucking and packaging and all
(15:51):
that stuff. That that is what is going to push
up in prices. That that is the driver of inflation,
which makes a lot of sense. Like there was apparently
right now, I don't know if it's still going on,
but it definitely was the spring. There's a shortage in
wood in lumber still happening, okay, because of at least
(16:12):
in part, the wildfires that California suffered last year were
so devastating that it actually affected the national supply of lumber. Yeah,
and I also read that the lumber people decreased production
overall because they thought because of the pandemic, they thought
there was going to be a big lull. They didn't
want all this extra inventory on their hands. It turned
(16:34):
out everyone was like, no, I want to build stuff now,
and they dis miscalculated. So it's not a good time
to build a pavilion at your family camp. Let's just
say that, right, or to try to increase the housing stock. Right.
So that means then that lumber going up in price
makes building a new house that much more expensive. So
(16:55):
the house, the finished product, has become more expensive because
of the input that raw material lumber. That's a really
good example of cost push theory of why prices are
rising because of something downstream in the production process. Yeah,
but there's a key little factor here. All of this
is true, Uh, when companies are running already at full
(17:18):
production capacity. So that's a really key element there. It
can't be a company that's um like behind or whatever.
It's like it's a company that's just humming along basically,
and then something happens in the supply chain, let's say,
big increase in fuel or lumber cost or any kind
of raw material. I think did Dave help us with this?
(17:38):
This is a Dave How Stuff Works article? Okay, yeah, wow,
I know, hats off. We found another one. But he's
as bread as the example. At the cost of wheat
goes up, the cost of flower is obviously going to
go up, and the cost of bread is eventually going
to go up under the uh the CP theory, and
so people like you and I end up paying more
(18:00):
for a new house, or more for a loaf of bread,
more for whatever, because something somewhere that was a component
in that caused this rise in prices, that would cause
that would that's the cost push example of theory of
of inflation, the kind of opposite of that. But I
(18:20):
don't even know the right word. They say, no, no, no,
it's not the raw materials that um cause the increase
in prices. It's actually the demand for that finished product
that that that causes the increase in prices, and so
housing right now actually is a really good example of
both cost push and demand pull at the same time. Yes,
(18:44):
it's crazy, and it's also demonstrating like, okay, we have
no idea what's going on, or at the very least,
that these things don't exist in isolation, and that is
that people like you're saying there the pandemic, We're like, no,
we want to move. I don't want to live in
the city anymore. I want to live as far away
from other people as possible, but but only as close
as instat cart will deliver. That's as close as I
want to live to the web van. Sure, yeah, um
(19:09):
so uh it was totally unpredicted. But the upshot of
it is that there is a lot of people trying
to buy houses right now and the housing markets just
gone through the roof, and so that's caused housing prices
to increase, and it's caused like all of the other
components of the housing market to increase as well. So downstream,
(19:32):
that demand for houses caused every bit of housing to
increase as a as a result. Yeah, and the example
Dave to stick with the bread as well. Because it's
a I think it's slightly easier to understand than the
housing market because it's so weirdly affected by a lot
of things. Right now, is that if the cost of
(19:53):
or if a lot of people want bread, the baker
doesn't immediately raise the prices because of that demand, um
until they run out of the flower. Then they got
to go back and buy more wheat, and the wheat
farmer might say, well, now it's a little more expensive. Yeah,
there's a lot of bakers who are have everybody wants
my wheat right now, and so that's when the cost
is eventually pulled and uh and then increased I guess
(20:16):
for the consumer. Right So it looks like if you're
just looking at it, like oh this this wheat price,
this raw material rose in in cost and that caused
bread to rise, and people are like, no, no, that
that's an illusion. It was actually this demand for bread
that increased that caused the wheat to rise. And again
it sounds so similar to cost push demand pull does
(20:39):
that it doesn't even matter, but it really does matter.
It does matter because and this part is the key here.
If you're at home and you're just like stop talking,
this is what kind of drove at home for me,
the difference in those two it might seem like just
words and nitpicky, but it's really not because in one
scenario and demand pull, you've got an economy that's really
humming and people like I want to buy all that stuff. Yeah,
(21:01):
it means a lot of people have a lot of
money that that they want to spend and that yes,
that means like you have a healthy economy, right then, right,
and under cost push, it's more like hey, uh, people
feel like they have to do this repair on their
house and I'm sorry, it's just a lot more expensive.
It's not like oh I need this new thing. It's
(21:22):
like I have to pay for this thing and it's
a lot more expensive because of the raw materials or whatever.
The labor has gone up, right, And and yeah, it's
much worse because that means, like you said, the company
is humming along at max capacity, and all of a sudden,
it's like we don't have wheat anymore, and we aren't
gonna be able to satisfy demand because we don't have
(21:42):
this basic component. It means that there's something broken in
your supply chain or the mechanisms of production and that's
not a good place to be in. So it's very
healthy economy or everybody has money increasing demand or demand
increases because you can't supply the basic parts to to
create those goods. Right, Okay, I know the beginning of
(22:05):
this part, so I'll take it, and then I have
a cot set up in the next room. I'm just
gonna go. I feel like you're setting me up for failure. Now,
you'll do fine because there's no math. Well, there is
math involved, but you'll still do fine. Where is their
math involved? Uh? In this part the annual rate of
inflation calculation. So but if if we get it wrong,
(22:29):
we'll just say Dave got it wrong, we'll pass that.
We'll cost push it his way. So we're talking about
how inflation is actually measured now, and uh, this is
a big deal because we like to keep track every
year and say that you know, inflation, what is it?
Usually between about one and a half percent to three
and a half percent annually in the US generally, unless
(22:50):
it's like the nineteen seventies or early eighties. I think
over the last several years it's gone between negative two
point one well in like five something per cent, which
is pretty five points. Something is pretty high. It's generally
in the two to three range. It is for our experience,
but in the early eighties it was as high as
(23:10):
almost that's bad. It was very bad, but not as
bad as like why Amar Republic Germany or in which
we've talked about a million times, where their hyper inflation
was just out of control. Yeah, wouldn't. We'll get to that, okay.
So we have to measure the um the inflation rate
because we like to keep tabs on our economy so
the FED can can do their weird black magic. And
(23:33):
so the Bureau of Labor Statistics the BLS, is who
kind of sets this stuff by working through a big
data collection system called the Consumer Price Index. It's nuts,
it is nuts how big it is. They take, Uh,
what they try and fill up is what's called the
CPI market basket. And it's basically, if you imagine a
(23:56):
grocery basket that includes everything everything basically like eighty tho items. Yeah,
I'm not just groceries. They have two hundred categories of
products in eight major groups food, housing, apparel, transportation, medical care, recreation, education, communication,
and then other which is basically everything else, uh, funerals
and manicures basically the other and saunas sounds. Yeah, definitely
(24:21):
that might be under recreation you think, I think it
might be or medical care. It's good for you, Yeah,
for sure, depending on how progressive your your Bureau of
Labor Statistics agency is at the time. That's right. So
every couple of years, thank you for waiting until I finished.
The Bureau of Labor Statistics interviews twenty four thousand American
(24:43):
families on the stuff that they bought. Yeah, because if
you have if you want to figure out what eighty
thousand items you need to include basket, you have to
find out what Americans are actually buying. Yeah, I bought
you a slide whistle. That's right. They called me up
and I said, I bought a slide whistle. That's the
only thing about this year. They said you're the one,
and they said that must have been for a very
special guy in your life, and it said it's true. Wow,
(25:05):
I'm blessing right. Uh. Then they have another twelve thousand
families that are keeping a spending diary. Basically it's kind
of like Nielsen a little bit. For that one. They
did kind of remind me that a little bit because
they're just trying to get a big broad overview of
what a typical schmuck here in America spend. And you say,
where's my three or five dollars? And they just go ahead,
(25:25):
they hang up real quick exactly somebody else. Uh. And
then every month they have a big team of assistance
that records the prices of those eighty thousand things. And
this is an effort to get just a good look
at what that big market basket looks like. Yeah, so
two years they figure out what they need to be
buying or what Americans are buying. They use that data
(25:46):
for another couple of years, but every month they go
and price all items in that that market basket every
single month. If you get a figure out inflation, you
got to be as current is possible. Yeah, So the
to figure out what item needs to be in the basket.
So there's like two d categories, eight broad categories, two subcategories.
(26:11):
So like transportation will have like auto insurance category subway
exactly m or food will have like you know, cheese
will be one. But in that cheese category sample, I
think they call it, there's you know a bunch of
different kinds that everybody buys like Kraft singles. Some are
Velvita slice. People like me, man, I used to love Velvita.
(26:34):
It's still good. I have it, had it in decades.
I will buy you somebody. Do you get blocks of Lvita? No,
we don't get blocks of Lvita. You get slices now, Okay,
but it's not cheese, right, and the cheese product perform cheese,
but I think it's still qualifies under the cheese sample
in the market basket that but if you're making a
chili cheese for something, you got to use it. Sure, yeah,
(26:55):
that's good. No, but this is it's good for grilled
cheeses to of course, so um that particular brand, but
not just that brand, like the you know, sixteen slice package.
They find it makes up sevent of the market for
that type of cheese. So they'll pick that one. They
use that for four years and then they go reevaluate it.
(27:17):
This is like the level of detail the BLS is
putting into their their basket. And so they take all
of this and they price it. Every single month. They
literally go to the store and I meant to say
literally that time and say, oh, well, the Velveta Cheese
slice sixteen pack is three forty nine, right, now, write
(27:37):
the price down. I think so, And then they go
back and they type it it and every month they
say this is how much that this cost and they
compare it strangely too. Right. Take it from here, Chuck, Well,
two was basically, uh was that was the baseline year
(27:59):
where they said, all right, here's our CPI index. It's
not an actual um it's an index. It's not a
dollar figure. I know, I looked everywhere. I'm like, how
much does that eight thousand, you know, item basket cost
in real dollars? Everything? Every they won't sorry, index buddy, Yeah,
they'll talk about UFOs sooner than they'll tell you how
much is in that basket? How much? So eighty two
(28:23):
is when that baseline figure was set, which was the
Consumer Price Index is a hundred uh in two thousand six.
It hit two hundred in April two thousand six, which
basically at that point they should have said, they should
have just reset it and said we have a new
base here because we doubled it, and they didn't know.
They just and I'm not sure why really they just
(28:44):
sort of left it in two. It seems like a
maybe they're just used to that math, it seems like
it would be a lot of extra math. And it wasn't. No,
it wasn't that they doubled it. It was that it
was the exact same in two I think. Or was
it that they doubled it. No, it was doubled. But
they said they should. I mean, some people say they
(29:06):
should have said like, all right, well we have a
new base, but they're still using the two. I guess,
I just I just don't know why. I don't either why.
Maybe it makes perfect sense. So so the actual um
number that they come up with is a number that's
relative to the amount that it costs in night two. Yeah,
(29:26):
this is where I kind of got a little foggy.
So for example, and that I mean, I fell asleep
on my debts in in two thousand nineteen, the c
p I, the consumer price index for that basket of
goods was two nine point to T two, okay, meaning
that that amount of goods cost almost two and a
(29:46):
half times what that same basket of goods would have
cost you in nineteen eighty two. Sure, so you say, okay,
I don't care how much it costs in nineteen eighty two.
I want to know how much it's affecting me now,
and they said, we'll just set a now, settle down.
They can take that number and say, well, how much
was it last month or how much was it last year?
So they can compare, say like the two thousand nineteen
(30:08):
and two thousand twenty c p I s and find
that there was a difference of something like about three
point oh two six between those two numbers. Then they
divide that by the two thousand nineteen percent um number
and they get the actual percentage that says the cp I,
the consumer price index, the amount of basically what it
(30:29):
cost people to just live in two thousand nineteen was
one two percent less than it costs in which means
that inflation rose one between and two thousand nineteen. Right,
And when you hear about inflation annual inflation rate, that
is generally what people are pointing to. But as we
(30:51):
will see, that is not how everyone likes to look
at inflation. There are other things to take into consideration.
I think the FED like to look at core inflation,
which is that CPI minus uh volatile things like food
and energy, things that like the prices kind of go
up and down uh more volatively. Sure is that a word, yeah, molybdium. Yeah. Uh.
(31:18):
And then the FED also looks at another data set
compiled by the pure the Bureau of Economic Analysis. This
gets a little wonky, but it actually does make sense.
The difference between the BLS and the b e A
indexes uh comes down to the fact that if chicken
costs a lot more money all of a sudden because
of some supplies or shortage or whatever, or increased demand, rather,
(31:41):
then people might go to the other white meat and say, well,
I'll start buying pork then. Yeah. That was explained by
Benjamin apple Bomb from the New York Times Economics blog
Benjamin Okay, yeah, he said, I swear to god I
nailed the apple Bob apple Bomb Okay, yeah, that's my
imaginary friend, Binjamine apple Bomb. Um. So uh he was.
(32:05):
He was explaining it like that, that that's the difference
that people adjust, Like we're not just like automatons were like, Okay,
well we're buying chicken and that's all we eat, and
we also buy X amount of hot dogs. It's like, yeah,
if the price of chicken goes up, you're gonna eat
something else that month. That that's just how people do
and so he was saying that the Bureau of Economic
(32:27):
Analysis really is much better at taking that into consideration.
And so since about two thousand, the FEDS kind of
relied a little more on that one than the c
p I. But the CPI is still very much the
most broadcast one. But it turns out that economists used
whichever one suits their needs and politician given month to
say our policies are right and your stink. That's a
(32:50):
great place for a break, and we'll come back and
talk about why inflation even matters and what we can
do about it, which is nothing right for this? All right,
(33:25):
So we're back to wrap this up. This wasn't as
bad as This wasn't as bad as I thought. Why
is it funny? I'm just I'm glad we're reaching in here.
I'm glad to see that you've come around a little bit.
You did great explaining everything. I appreciate it. So. Uh,
strength of Dave's research, I think, sure, not like the
John Mirror person. Dave's wonderful his work, he is, He's great. Uh.
(33:50):
So inflation can be a bad thing because of some
sort of obvious things. But one is if you have
a fixed income and you're living off a pension or something.
A lot of times, most times that pension isn't going
to go up because inflation goes up. Luckily, social security does.
It's tied to that CPI UM, which was a really
(34:13):
smart thing to make people like not absolutely loath social
security in every way. But yeah, social Security will go up,
but your pension won't. So that's a big deal. And
that's why inflation matters. Yeah, I mean it also stinks
for those of us who are like, man, I'm paying
way more for bread than I was this time last year,
and why should i? Um. It also has an effect
(34:36):
on investments too. Um. Remember, a different way of looking
at inflation is not just that prices are rising, but
that the buying power of the dollar is going down. Yeah,
so your investment, Yeah, if you have an investment is
worth ten grand. Uh, you know, five years from now,
it's still the dollar amount, still worth ten grand, but
the value of the dollars far less than it was
(34:58):
five years before, and so that ten grand just doesn't
amount to quite as much. Another thing that can happen
is your interest rates might go up or uh not.
Your interest rate role reset. But if you go to
buy a house or something. The interest rate might be
higher because a bank might say, you know, I think
inflation is gonna be pretty bad this year, so we're
(35:19):
gonna we're gonna have to charge more money on that
loan because we're losing that dollar value, right exactly, and
banks don't like losing money. Um. There's also like a
lot of uncertainty that could come when inflation is going on.
Remember I said inflation, Like, there are a lot of
inflation fears until today. Um. That has a really deletrious
effect on business in that Um, they don't it's harder
(35:42):
to plan for the future. They don't know how much
the cost of the goods that they need to make
their finished products they're going to be, right, So you
don't know, you know, if you're gonna buy a whole
bunch of you know, meal worm spray for your your
flower to make bread with. Um, is a better to
buy it now? Is it better to buy it later?
And how much am I going to price? Has spread
(36:04):
for it's it's just a catastrophe. And then they eventually
just give up and go home and watch Judge Judy. Yeah,
I gotta say that's um. Like with Emily, small business
that I think, especially with small businesses, she can't just
be like, oh, well, shipping is a lot more now
because fuel costs are going up or packaging is increases.
So she can't just raise and lower her prices willy
(36:26):
nilly when you're a small business selling soap in lotion
and candles, Which is funny because that is one of
the major explanations for inflation. I know, but you just
can't do that as a small as you can be
like our soap a quarter more all of a sudden,
or a quarter less, like she kind of a lock
in for a little while. Like a price increase for
a small business like that is sort of a big deal.
(36:49):
You got to really think it through. Yeah, yeah, I do. Um.
And that's actually another problem with it too. It's like
if if Emily can make less money um selling her wares,
but she's paying more to make them, her profit margin declines.
In that sense, she might have less to expand um
(37:10):
to hire more people total, and so that has a
ripple effect through the economy where it can affect employment.
Higher prices can actually lead to lower employment. Yeah, Like
she gets killed on shipping, that's her big one, Like
she loses money a lot of money every year on
shipping costs. But you can't just like she's not Amazon,
so she can't can't ship for free, and you can't
(37:31):
also charge what it really costs to ship. You just
have to kind of take the hit. Yeah, you know
it's interesting. Uh. I guess we can talk about hyper
inflation a little bit. We've covered it a few times
over the past thirteen years. But the one big one
that people always talk about is, like you mentioned earlier,
the Weimar Republic of Germany when the mark exploded from
(37:54):
two thousand marks to the US dollar in nineteen two
to four point two trip alien marks to the dollar,
uh less than a year later, And that nuts. That
is I mean, you can't even wrap your head around
and remember in Zimbabwe and that I can't remember what
what decade it was, the eighties, maybe the nineties where
they were they were like using wheelbarrows to cart trillion
(38:17):
dollar bills um to the grocery store and still could
barely buy bread or toilet paper with it. Yeah, the US,
like I said earlier, it had its own brush with
I don't know if you call it hyper inflation, but
definitely much higher inflation than anybody was comfortable with UH,
and that actually came I was researching this today. A
lot of people blame the UM, the opeque, oil embargo, UM,
(38:41):
a lot of other stuff, but it apparently can all
be laid at the feet of Richard Dixon, who juiced
the economy. He fired his FED chairman and replaced him
with a sycophant who had no formal economics training, and
then started telling him what to do. Sound familiar to
juice the economy to get reelected. And it worked for
a minute, and then all of a sudden, it was
(39:02):
like this plane going up and then the gas was
no longer in the fuel injector and started just tumble
back towards the earth. We had almost um uh inflation. Yeah,
I mean that unemployment. That's a real number that like
makes an actual difference in American families, like getting what
they need, Yeah, for sure gas and food and you know,
(39:23):
paying builds. Yeah. So it took a good decade or
so to come out of that death spiral that it
was in, and it took the FED. And this is
a this was actually a big reason why the FED
plays such a big role in the economy today is
because of that the FED had to step in and
basically do the opposite of um easy money and basically
(39:44):
get money off of the market to basically say, all
these people who have money right now, we need to
take some of their money to lower demand, to cause
prices to go down. And it was a really hard
time to be an American in the late se in
these early eighties because it caused this, uh, the Great
Inflation and then a pretty big recession. Yeah, there are
(40:06):
a few things that the FED can do to uh,
you know. One thing that you might see on stupid
Facebook comments is like, just print more money. Fed. That's
all they do anyway, just put more cash into the economy.
They don't do that. The FED doesn't just print more money.
They can influence the money supply though, in a few ways.
(40:28):
One is there's something called the reserve requirement, which is
basically they say, you know what, if you're a bank,
you have to have a certain percentage of your customer
deposits that you don't you can't touch. You gotta leave
it in there and reserve. So they can lower that
requirement a little bit, meaning that in theory, more money
can be in circulation because they're loaning out more or
(40:49):
they're able to loan out more. So that's one thing
they can do. Um. They can also uh, they actually
buy and sell bonds. This is where it gets so
crazy to me, Like this just sounds so weird, but
I mean there's a whole market there that actually is
basically how money gets on or off the market in
the economy. There's this, there's sales of bonds where companies
(41:12):
can buy bonds, companies can sell bonds um, and the
FED will buy or sell them too. And when the
FED buys bonds is putting money on the market, and
when the Fed sells bonds, it's accepting money. It's taking
money off the markets, treating those bonds for money, and
making sure that that money isn't in circulation anymore, at
least temporarily. That's what's happening today. They're going to auction
(41:34):
off a hundred billion dollars in bonds, So a hundred
billion dollars will not be in the economy tomorrow after
this auction today because the Fed's taking it off the market,
which was enough to um to calm those inflation warries.
Everybody's at uh, the FED steppinge in, It's fine. Well,
now they're like a hundred people that understand that said,
(41:55):
oh okay, and everyone else just read the headline. T L. D.
R right said all right, we're not supposed to worry,
so I won't worry. But at the same at the
same time, you made reference though earlier that it was
like Joe Biden screwing up the economy, that they were
blaming those stimulus checks for everything from people not working
purposefully to um there being too much money and increasing
(42:18):
demand for regular stuff, and the whether that's true or not.
The FED stepping in and saying, well, we're just gonna
get some money off the market. Another thing the government
can do is the opposite of something like stimulus checks.
It can actually raise taxes. And that's another way for
the government rather than the FED to get money out
of circulation by by taking it from people's you know,
(42:41):
end of your account, end of your account. Uh. And
then the other The final thing the Fed can do
is they can lower their discount rate, which is the
rate that is going to charge a bank for a
short term loan. And in theory, if a bank is
paying less for a loan, then they can lend at
a lower rate as well. If you're going and skiing
for a loan. And then lastly there's supply side economics.
(43:03):
Another thing the government can do, which is basically deregulate
industry in the hopes that it will make industry leaner,
more competitive, all that stuff, and that that will cause
prices to go down because businesses will become more efficient
when it's dog eat dog. I think we've seen, thanks
to reagonomics, that that doesn't necessarily work very well. That's
what they say. That's my two cents, And hey, man,
(43:26):
I'm just as much an economist as any economist. It
sounds like it. Uh. If you want to know more
about economics and inflation and stag inflation and deflation and
all deflations, go do some research and it will blow
your mind. And since I said that it's time for
listener mail, I'm gonna call this one of the many
(43:46):
great responses from our Girl Scout episode. Good morning, Josh
and Chuck at the pleasure of listening to the Girl
Scout episode. When I was sewing the badges onto my
daughter's best in time for our bridging ceremony. My daughters
our fourth generation Girl Scouts, and I'm a third generation leader.
I love this very big family. I have the honor
(44:08):
to service one of five leaders and a multi level
troop or troop as girls from kindergarten through seventh grade,
encompassing Daisy, Brownie, Jr. And Cadet levels. We formed as
a multi level troop so sisters could be in the
same troop. That's really sweet, and so that their parents
could have one troop to keep track of. It's a
great way for the older girls to practice leadership skills
(44:28):
with the younger girls and gives the younger girls role models.
This sounds great, very sweet. They should do this everywhere
everyone else is doing it wrong, she said, But no
Juliets are allowed. Yeah, no, Juliet. Another unique thing about
our troop is that we do not charge dues. Everything
our girls do from uniforms, program supplies, and activities are
funded solely through cookie sales. We asked new girls to
(44:52):
buy their first vest for the uniform and from their
cookie sales take care of the rest. Uh. Caroline here
leads the Daisies in their troop and says, even at
the youngest levels, the emphasis is then a girl that experience.
That means they choose their activities and badges, plan and
run the meetings, practice leadership skills. Each chance they get
(45:13):
takes a lot of practice and self control in the
part of the leaders to give the girls space to lead,
but the end result is so rewarding. I will leave
you with one last lesson that I've learned in Girl
Scouts and a motto that my family has always lived by.
This is great. This is what everyone should do. Leave
a place better than you found it. Oh yeah, whether
it's cleaning up a little extra garbage at campsite or
(45:35):
making a positive impact on the people in places you
come across in life, leave it a little better than
you found it. Thank you for all the many years
of podcast that are brightened many a dull car ride
and countless rounds and towards from my family, except for
the inflation episode. That's weird. How do you know? So
that is from Caroline and rich Field, Minnesota, and she's
(46:00):
send in pictures of the daisies and the girl bridging
ceremony and it's just adorable, these cute little girls in
their masks doing stuff. Yeah, who is that? That's Caroline? Caroline?
So I thought, thanks a lot, Caroline, was some great info.
I'm glad you enjoyed that. So we enjoyed it too.
(46:20):
Um and uh, I guess it's a hunt Chuck. Yeah,
I should point out she wrote back and said, by
the way, my husband is gonna be jealous. I'm getting
this on listener mail. I should mention that he went
through boy Scouts all the way through high school just
so he could go camping. All he did was enough
to get the badges so you could qualify for camping trips.
It's awesome. So the rest of them, he said, we
don't need no stinking badge. Uh. Well, if you want
(46:43):
to get in touch of this, like Caroline did, you
can do that via email. Send us one to stuff
podcast at iHeart radio dot com. Stuff you Should Know
is a production of I Heart Radio. For more podcasts
my heart Radio, visit the heart Radio app, Apple Podcasts,
or wherever you listen to your favorite shows. H m
(47:10):
hm
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