You put a pot of water on the stove, turn on the heat and wait. How can you determine if and when the water reaches the temperature to turn from liquid to gas?
You could put a temperature probe in the water and wait for it to send an alarm at 100°C to your Smartphone’s “Remote Temperature App.” You might personally observe to see if the water is boiling, or you could ask someone else to look at the water and tell you if it is boiling. Which of these is the most accurate?
The highest potential for a “wrong” answer is with the thermometer. Most likely we would trust this method to accurately tell us when the water boils. But the temperature probe could be faulty. Further, water boils at 100°C at sea level. In Baguio, 1,500 meters above sea level, water turns to steam at 98.5ºC. The temperature app might never reach 100°C.
Your friend might interpret “boiling” with the first little bubble, while you meant a “rolling boiling.”
The point of this silly story is that actual unbiased observation is probably the best measure of anything, and while the world often plays tricks on the senses, trusting what we hear, see, and touch might be better than relying on someone else’s interpretation even when reading the thermometer.
US President Joe Biden last Wednesday claimed that the US economy had no inflation for July. July 10, 2022: “Today, we received news that our economy had zero percent inflation in the month of July. Zero percent.”
This is the president making an unequivocal statement based on data compiled and released by the US Department of Labor’s Bureau of Labor Statistics. How could anyone argue with the President, especially when the data is released to the world?
Biden was correct. The total price of the “basket of goods” was unchanged from the month of June as “The gasoline index fell 7.7 percent in July, natural gas declined 3.6 percent, airline fares slumped 7.8 percent and prices for used cars and trucks dropped 0.4 percent.” However, the food inflation index was up 1.1 percent, coffee increased by 3.5 percent, and car insurance as up 1.3 percent from the previous month. Further, food prices were up 10.9 percent from July 2022, along with electricity prices accelerating by 15.2 percent, and total energy costs were 32.9 percent higher than in 2022.
It is probably not a good idea to have Joe Biden check your body temperature if you are sick. “Great news. Your temperature did not go up from this morning. It is still 43 degrees.”
How is the local mall business? Count the numbers of cashiers open in the department store compared to pre-Covid. I guarantee it is fewer. You do not need the Philippine Statistics Authority for the nation’s inflation numbers. April 2019: 1 pc Chickenjoy Value Meal: P79. July 2022: 1 pc Chickenjoy Value Meal: P95.
July 13, 2022: “Kitty Ussher, Chief Economist at the Institute of Chartered Accountants in England and Wales, says inflation rates are likely to come back within a manageable margin by next year, and the fundamentals of the UK economy are in better shape than many business leaders think.”
Then again, “Dogs Trust, a British animal welfare group, said pet-owners are increasingly unable to afford their animals as the cost-of-living crisis bites, receiving 15,000 calls this year from owners asking about the process of giving up their dogs to be rehomed, up 54 percent from last year.”
And how is the Chinese economy doing? Watcheco, a Chinese portal for used luxury watches, said the price of second-hand Rolex Submariners has crashed by 46 percent since March. Luxury bag shops in Shanghai and Hangzhou have cut the prices of Hermès Birkin bags by 20 percent over the same period.
The Chinese government may have had no choice but to report that the quarter-on-quarter GDP fell 2.6 percent in June. Beijing officials probably all own at least a Submariner. And Joe Biden’s dog is paid for by the taxpayers.
E-mail me at mangun@gmail.com. Follow me on Twitter @mangunonmarkets. PSE stock-market information and technical analysis provided by AAA Southeast Equities Inc.