Despite Headline Inflation Decline, Essential Necessities Face Persistent 5%+ Inflation, Contributing to Ongoing Affordability Crisis; Older Workers Turn to Entry-Level Jobs; 40% of Under 30s Rely on Family Support for Home Down Payments.

Inflation in essential areas, including car insurance, car repair, transportation, rent, homeowner costs, and food away from home, far exceeds the 3.2% CPI headline rate, challenging the notion of a broader decline in prices and signaling an ongoing affordability crisis for consumers.

While CPI inflation is at 3.2%, inflation is much higher in many basic necessities:

1. Car Insurance Inflation: 19.2%
2. Car Repair Inflation: 9.6%
3. Transportation Inflation: 9.2%
4. Rent Inflation: 7.2%
5. Homeowner Inflation: 6.8%
6. Food Away From Home Inflation: 5.4%
7.…

— The Kobeissi Letter (@KobeissiLetter) November 17, 2023

This brings up another important question:

Would the economy benefit from a period of deflation?

The last time the US experienced deflation was for a short period in 2009.

While prices declining sounds great, it's generally a bad sign for the overall economy.

— The Kobeissi Letter (@KobeissiLetter) November 17, 2023

My car insurance just went up 30% after 6 months

— Stin (@Stin_101) November 17, 2023

Employers have seen an uptick in older people applying for entry-level positions, per the Financial Post.

— unusual_whales (@unusual_whales) November 17, 2023

40% of under 30s received family money for down payment, per Redfin.

— unusual_whales (@unusual_whales) November 17, 2023