The Price Illusion

My suspicion is the economy is already in recession. From an investment/trading view, I don't think it matters if I am wrong. Maybe it's better than I think, but that's still worse than the average investor thinks.

The stats out of Japan put a giant exclamation point on the price illusion caused by inflation. Exports rose 15 percent, imports 30 percent. Back out price effect and exports fell 2 percent, imports unchanged from a year ago. They're paying 30 percent more for the same volume of imports...now the tumbling yen makes perfect sense, right?

It's worse, so much worse on Japan's import side. Total imports were up more than 30% (THIRTY!) yy in March. By value.

Actual quantity imported was 0.0% yy. Zero.

The Japanese paid almost a third more than last year to get the same mostly raw materials. That's going to be bad. pic.twitter.com/6v6XmYSp0S

— Jeffrey P. Snider (@JeffSnider_AIP) April 21, 2022