In the third quarter of 2023, the Kansas economy grew at the annual rate of 9.7 percent. Real Gross Domestic Product rose in all states, with Kansas ranking first. (more…)
Author: Bob Weeks
National Employment Situation, December 2023
Total nonfarm payroll employment increased by 216,000 in December 2023 from November 2023. The unemployment rate was unchanged at 3.7 percent. (more…)
Kansas Employment Situation, November 2023
In Kansas for November 2023, the labor force fell, the number of jobs rose, and the unemployment rate was unchanged when compared to the previous month. Over the year, Kansas is below the middle of the states in job growth. (more…)
Economic Indicators in the States
A visualization of coincident economic indicators for the states. (more…)
Consumer Price Index, November 2023
Looking at inflation calculations in a different way.
These charts show the Consumer Price Index (the primary measure of changes in prices and inflation) compounded in three ways. The usual number reported about inflation is the year-over-year change in CPI. Example 1 shows this value mostly around two percent from 2000 through 2021, with a few excursions higher and lower.
When the rate is steady, this makes sense. Recently, though, the rate has been changing, with a big swing up, and then down.
This means the year-over-year change — the usual measure of the inflation rate — hides some information that is useful.
Today, Bureau of Labor Statistics, part of the United States Department of Labor, released CPI numbers for October 2023:
The Consumer Price Index for All Urban Consumers (CPI-U) increased 0.1 percent in November on a seasonally adjusted basis, after being unchanged in October, the U.S. Bureau of Labor Statistics reported today. Over the last 12 months, the all items index increased 3.1 percent before seasonal adjustment.
BLS reported two “inflation rates,” the monthly change of 0.1 percent, and the year-over-year change of 3.1 percent. Which is most meaningful?
Both hold meaning, but the year-over-year measure is based, in part, on events that happened up to one year ago. The monthly change considers just the most recent month. To cast the monthly rate in a form compatible with the scale of the annual rate, we can annualize the monthly rate. That is, what would the year-over-year inflation rate be if the current monthly change continued (compounded) for a year?
The two charts below show this. Chart 4a shows the year-over-year change, along with quarter-over-quarter change and month-over-month change. The year-over-year value is 3.1 percent, as reported by BLS.
Chart 4b shows the month-over-month change expressed as a compound annual rate. It is, for this month, zero (when rounded), as reported by BLS. This is what the year-over-year inflation rate would be if the current value continued for another 11 months. This value is now 1.17 percent. If we extrapolated the change during the most recent quarter to the coming year, the value is 1.62 percent.
Of course, we don’t know what will happen in the future, so this annualized rate is only a crude projection, perhaps even a fantasy. Further, since the month-over-month price change varies substantially, the corresponding compounded annual rate does, too. This is easily seen in chart 4b in the monthly series. The quarterly series is less volatile.
For this month, using the monthly compounded rate is advantageous to the current administration, as it can say (with appropriate caveats) inflation is 1.2 percent instead of 3.1 percent. But in the months in the chart where the monthly line is above the annual line, the reverse holds. In August, for example, the year-over-year rate was 3.7 percent, but the month-over-month rate, if annualized, was 7.8 percent.
Sure, AI Can Do That
A post about AI reveals lack of knowledge and conspiratorial mindsets.
Something making the rounds on Facebook makes claims about the ability of A.I. to read cursive handwriting. As can be seen nearby, I fed the image into a popular AI model, and it understood the writing without error.
This post had over 300 reactions, and a number of comments like these:
“True” No, false.
“Powerfull!” Actually, weak.
“very good! one step ahead of them!! you are! write down ur thoughts in cursive..screen shot and upload..” It seems this person believes cursive is like a form of encryption to keep your secrets from being read by computers.
“…or because they don’t want the next generation to be able to read the Constitution.” For many years the Constitution has been available in non-cursive versions.
“Ah ha! Now we know why cursive is being kicked out of schools” Difficult to understand the thought behind this.
“I don’t think they uckingfay eadray igpay atinlay either LOL”
I fed this to ChatGPT and asked: Can you translate this? (I censored the language.)
Sure! The text you’ve provided is written in a playful code called “Pig Latin,” which involves rearranging the letters of English words. In Pig Latin, the first consonant or consonant cluster of an English word is moved to the end of the word and followed by an “ay”. If a word begins with a vowel, you just add “way” or “ay” to the end.
The text “uckingfay eadray igpay atinlay” translates to “f****** read pig latin” in English. The entire sentence would be: “I don’t think they f****** read Pig Latin either LOL.”
What’s notable here is the level of knowledge about an important new technology that may have transformative effects on our economy and world. Of 28 comments, 27 comments showed no understanding of AI and its capabilities. Yet, they had opinions to express in public.
But it goes farther than simple ignorance. I got the sense that many of these commenters were proud to show their lack of everyday knowledge. It’s another example of conspiratorial thinking, starting with the unfounded statement about vaccines in the handwriting sample. This mindset was evident in some of the comments, such as why schools stop teaching cursive and don’t want people to read the constitution. Unfortunately, some people are happy this way.
Gas Prices in Days Past
A meme on Facebook shows a photograph of gasoline prices from a past era with the caption: “Gas prices like this would be a nice gift.” (more…)
