Last Wednesday, we reported that the CPI came in at 3.8%. The next day, the BLS reported the PPI, the prices producers pay, hit 6%.

What does that mean?

The PPI leads CPI. What businesses absorb today, consumers are likely to pay tomorrow. If producers are paying more, they will eventually pass that on to consumers. That means consumers should brace themselves for even higher prices in the near future. We are likely to see CPI increase even faster than it has been.

Here’s what Brandon said on the podcast this week that stayed with me: this isn’t something that happened to us. Tariffs are a policy choice. The Iran conflict accelerated it, but the stair-step rise in prices was already underway before that. And because prices move up like a rocket and come down like a feather, sticky on the way down due to long-term contracts, renegotiation cycles, and producer margins, expecting a fast reversal is wishful thinking.

The labor market is holding, but it’s not dynamic. Brandon noted that with reduced immigration, the economy simply needs fewer new jobs to maintain stability, which makes 115,000 monthly additions look better than they probably are. And less immigration over time means fewer entrepreneurs, less innovation, and more anemic growth further down the road. The GDP math is not flattering.

What does this mean for your wallet right now? Brandon’s personal story said it better than any chart could: airfare that was $300 rose to $1,200 after the news of Iran broke. He took a connecting flight instead of a direct flight. Gas is running 50–60% higher than it was two months ago, which changes the calculus for which jobs are worth commuting to, how hard people push back on return-to-office mandates, and which big purchases get delayed.

It is easy to focus on the data point and forget the human-centered story behind the data.

One more thing from this episode worth knowing about:

Brandon is a founding member of EENE — the Economic Education Network for Experiments (eene.org). It’s a research collaboration of 200+ economics instructors across institutions — public, private, HBCUs, R1s — running synchronized classroom experiments to actually answer what works in economics education. Most education research is too small to generalize. EENE is trying to fix that with scale and rigor. They have papers under review and their third annual conference coming up after CTREE in Las Vegas this summer. If you teach economics or know someone who does, this is worth knowing about.

The full conversation — inflation, AI in education, what Microsoft and OpenAI executives actually want from new graduates — is in this week’s episode of The Weekly Rap.

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