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Jan 8 17 2:52 PM
Inflation has a slow methodical pattern of crushing every little
dollar you have in your wallet. Even a moderate level of inflation is
an enormous change when incomes go stagnant.
There is talk about how spending this year isn’t all that great. This
is a big deal considering that our economy runs on non-stop spending and
a large part of spending happens during the holiday months. But
Americans are still constrained from the Great Recession’s echo impact.
The lingering financial problems remain and many Americans have swapped
good paying jobs with many in low wage service jobs.
The end result should not be a surprise but there is less to spend even
with credit card access and more debt being thrown on cash strapped
households. We keep hearing about how controlled inflation is but in
reality, we are seeing price increases in many important segments of our
society. No inflation they say. Let us look at some key items.
Black Blade: The cost for most necessities for living are rising rapidly while retirement funds and wages are slowing (or even declining). We have come closer and closer to the next Great Depression (many say we have been in the "Greater Depression" for some time and it is getting worse). Meanwhile, companies move offshore, good paying jobs disappear, and costs of living rise all this while the Government tracking agencies such as the BLS continue to "jerk us off" with bogus data and a compliant propaganda media hoping no one will notice.
Jan 13 17 3:18 PM
zerohedge.com / by Tyler Durden / Jan 13, 2017 8:57 AM
While headline PPI came in at 0.3% on a sequential basis, as
expected, and rose 1.6% on the year, also in line with expectations, it
was the core PPI that came in modestly hotter than expected, printing at
0.2%, above the expected 0.1%, and rose 1.6% Y/Y, above the 1.5%
expected, and far above the -1.1% drop reported one year ago.The
headline jump was driven by a spike in energy prices, as final demand
energy rose 2.6% in December. Accounting for almost half of the December
jump in final demand goods prices, the index for gasoline climbed 7.8% ,
while heating oil was up 9.6%.
Away from the non-core energy and gasoline prices, the headline PPI
rise was driven, surprisingly, mostly by “prices for securities
brokerage, dealing, investment advice, and related services” which
advanced 4.4%. In other words, brokers are capitalizing on the rush by
retail investors to jump in the market and are hiking prices.
Nonetheless, on an annual basis, the 1.6% increase in PPI was the highest since August 2014.
Jan 18 17 12:13 PM
investmentwatchblog.com / BY IWB · JANUARY 18, 2017
by Umar Farooq
Stagflation happens when the economy experiences stagnant economic progress, high unemployment, and high inflation. It’s a rare situation. A slow-moving economy usually reduces demand enough
to keep prices from rising. As workers get laid off, they buy less. As a
result, businesses lower prices to attract whatever customers remain.
Slow growth in a normal market economy prevents inflation.
Jan 19 17 4:08 PM
armstrongeconomics.com / by Martin Armstrong / Jan 19, 2017
Prices in the US are picking up strongly and support the Fed’s arguments for raising interest rates further. The rate of inflation rose by 2.1% in December, according to the Ministry of Labor. This is the highest increase since two and a half years. Some are suggesting this is due to higher gasoline prices and rents in particular caused the buoyancy. After all, the November rate was still 1.7%. The Fed has been targeting two percent. The Fed raised the key interest rate in December to 0.5 to 0.75%, and took three further steps upward for 2017.
With consumer confidence
at record highs, that means consumers will spend confidently. This is
the real issue behind the trend, which is polar opposite to Europe and
Japan. Nevertheless, the rising trend in U.S. interest rates points to
support for the dollar. The higher the dollar, the cheaper the imports.
This will play at odds against the Trump policies.
Feb 2 17 11:44 AM
deviantinvestor.com / by Gary Christenson / February 2, 2017
The United States suffered through a deflationary depression in the
1930s. Stock prices crashed, currency in circulation declined, commodity
and real estate prices fell hard and human misery prevailed.
President Roosevelt revalued gold from $20.67 to $35.00 per ounce in 1933 – a substantial devaluation of the dollar. Make-work and government spending programs were implemented. War followed the depression.
Feb 14 17 7:04 PM
mishtalk.com / Mike “Mish” Shedlock / February 13, 2017
Every month the Federal Reserve Bank of New York does a survey of consumer expectations: Inflation, spending, earning, and jobs.
The January 2017 report came out today.
Amusingly, the Fed indirectly relies on consumer confidence numbers
to gage spending projections but does not rely on its own survey of
Feb 16 17 2:55 AM
wolfstreet.com / by Wolf Richter • Feb 15, 2017
Workers, bondholders, savers get sacked. So what would Yellen do?
Consumer prices surged 0.6% in January from December, double the
consensus forecast of a 0.3% rise. The sharpest monthly increase since
February 2013, according to the Bureau of Labor Statistics.
Energy prices jumped 4% month over month, including gasoline which
jumped 7.8%. Food prices edged up 0.1%. Within this group, “food at
home” was unchanged, but prices for “food away from home” – restaurants,
taco trucks, and the like – rose 0.4%. In just one month, the prices
of apparel rose 1.4%, of new vehicles 0.9%, of auto insurance 0.8%, of
airline fares 2.0%. Shelter rose “only” 0.2%, as the national numbers
are now feeling the downward pressure on rents in some of the most expensive rental markets in the US.
This chart shows just how sharp that jump in monthly price increases is, compared to recent years:
Feb 22 17 1:41 PM
deviantinvestor.com / by Gary Christenson / February 22, 2017
Steve St. Angelo wrote an insightful article relating the silver to gold ratio to the S&P 500 Index. I encourage you to read his articles and analysis.
My commentary on the silver to gold ratio:
The following graph shows the SI/GC ratio versus the S&P500 index
beginning in August 1971 when President Nixon severed the final gold
backing of the US dollar. Currency in circulation, debt, consumer cost
of living, and most prices including gold, silver, crude oil, and the
S&P rose in devalued dollar units.
Mar 3 17 10:47 AM
wolfstreet.com / by Wolf Richter / Mar 2, 2017
Limited, steady inflation is the best thing since sliced bread, so to
speak, for over-indebted companies, governments, and for debt-slave
consumers – if wages rise faster than inflation, which they haven’t done
in years. But it’s a vicious parasite for companies that cannot fully
pass on their inflated input costs to the consumer. Sales rise due to
inflation without having to sell a single extra thing, and analysts love
that. But costs go up too, and at Costco, they went up faster than
sales, and now its high-flying stock is tanking.
Costco, the second largest US retailer after Wal-Mart with 728 stores
in nine countries, including 508 in the US and Puerto Rico and 94 in
Canada, was considered one of the exceptions to the brick-and-mortar retail fiasco. But now that it released its earnings, it too is stirring up doubts.
Mar 13 17 2:11 AM
news.goldseek.com / By Gordon T Long / 12 March 2017
It is important to anticipate whether Stagflation is stalking because
the yield curve will start pricing it in which will place equity
yields, earnings and PE growth multiples at risk.
We believe there are clear signs of stagflation already occurring and
according to the recent Global Fund Manger Survey many already believe,
if we don’t have elevated Inflation and an emerging period of
Stagflation, we can soon expect it!
What is particularly critical to the equities markets is how the
yield curve will react differently regarding whether it anticipates
increasing Inflation through Reflation or Stagflation. If it views
reflation the yield curve will shift up but also steepen as long-term
yields increase faster than short term yields. If it sees stagflation
because the drivers for inflation also impede economic growth, then the
yield curve also shifts upward but instead can be expected to flatten.
The longer-term yields rise slower than the short term yields.
Mar 14 17 11:57 AM
zerohedge.com / by Tyler Durden / Mar 14, 2017
With tomorrow’s rate hike baked in the cake, today’s hotter than
expected PPI print for February provides Yellen more cover (as economic
growth forecasts slump). PPI Final Demand surged 2.2% YoY (more than
expected) driven by a 4.0% YoY jump in final demand goods. This is the highest inflationary print since March 2012.
Mar 15 17 9:46 AM
zerohedge.com / by Tyler Durden / Mar 15, 2017 8:39 AM
After the hotter-than-expected PPI print, Consumer Prices confirmed that inflation is running hot with the fastest rise since Feb 2012.
Notably core CPI (at 2.2%) has been above The Fed’s mandated 2% ‘price stability’ level for 15 months in a row.
Of course, one of the big drivers of this price surge is in shelter and rent inflation…
Mar 20 17 3:08 PM
wolfstreet.com / by Wolf Richter / Mar 20, 2017
Inflation will rise above target, and that’s OK, the Fed heads who’ve
been talking since last week’s meeting said. The Fed will hike rates,
maybe faster than expected, but they won’t catch up with inflation,
keeping the Fed purposefully behind the curve, and inflation will
overshoot, and real interest rates will be deeply negative, whether you
like it or not. That’s the Fed’s message emerging since the last
Today, Philadelphia Fed President Patrick Harker and Chicago Fed
President Charles Evans echoed Fed Chair Janet Yellen who’d suggested on
Wednesday that the Fed could try to push inflation above the 2%
But the Fed’s measure of inflation is the Personal Consumption
Expenditure index (PCE index), which is significantly below the Consumer
Price Index (CPI) which already jumped 2.74% in February,
Harker and Evans are the first Fed heads to talk since the Fed’s
policy-setting committee (FOMC) last week raised the target for the
federal funds rate a quarter point to a range of 0.75% to 1.0%.
Mar 21 17 12:31 PM
gainspainscapital.com / Graham Summers / March 21, 2017
Pop quiz, name the top performing asset class of thus far this year?
If you guessed US stocks or bonds, you’re wrong. The top performing
asset class hands down is Emerging Market stocks, followed by Gold, THEN the S&P 500, followed by Treasuries and finally, Oil.
Using this as a framework, let’s ask ourselves, “what macro
environment would cause these respective performances? What would induce
a sharp rally in Emerging Market Stocks and Gold… with US stocks
trailing and Oil down sharply?”
Oil is telling us that growth is actually very weak, while Gold and
Emerging markets and bonds are telling us inflation is picking up (a
weak $USD sends Gold and Ems higher while it would depress bonds).
Mar 25 17 3:07 PM
zerohedge.com / by Tyler Durden / Mar 24, 2017 2:54 PM
The Fed’s most recurring lament over the past 8 years, ever since the
Financial crisis, is that there has been no measurable inflation in the
US economy when using such conventional indicators as CPI, even though
according to recent measurements by PriceStats real inflation,
not the BLS’ seasonally-adjusted, goalseeked and politically
convenient mutant, is now running at a blistering 3.6%, the highest in
Apr 6 17 2:31 PM
caseyresearch.com / By Justin Spittler / April 05, 2017
Let’s talk shrinkage.
It’s a serious problem that’s affecting all of us.
I’ll explain why in a second. But first, look at the size of this candy bar…
It’s a joke.
As I’m sure you know, it wasn’t always like this. When I was a kid, a
Fun Size Milky Way was much bigger. You actually got your money’s
Today, it feels like you’re being robbed blind.
And it’s not just candy manufacturers that are short-changing
customers. Companies around the world are doing the exact same thing.
There’s even a name for this shady practice…
Apr 14 17 7:45 PM
zerohedge.com / by Tyler Durden / Apr 14, 2017 8:57 AM
The reflation trade is officially over.
At the same time that retail sales posted the worst 2 month drop in 2
years, CPI – the bedrock behind the Fed’s rate hiking intentions – just
hit a brick wall, and after months of headline CPI growth mostly the
back of the energy “base effect”, in March this ended with a thud, when
headline CPI printed at -0.3%, badly missing expectations of an
unchanged print. The number was so bad, all 79 economist estimates
missed the number (predicting a -0.2% low).
The biggest driver for the headline plunge was energy, which declined
3.2%, with the gasoline index falling 6.2%, and other major energy
component indexes decreasing as well. The food index rose 0.3 percent,
with the index for food at home increasing 0.5% its largest increase
since May 2014.
But the real story was in the core numer, because CPI ex-food and
energy dropped -0.1%, another huge miss to the +0.2% rise expected, and also the first – and worst – decline since January 2010.
Jun 16 17 2:43 PM
mybudget360.com / June 15, 2017
Inflation has a slow destructive impact on your purchasing power.
Most people don’t think twice about inflation. They just assume that
the price of goods will go up because that is the way it has always
been. Yet that is not true. The type of inflation we are seeing is
debt supported inflation which has made the cost of normally affordable goods inaccessible for most Americans.
It has also been a big reason for why retail is getting severely hit.
Yet where does most of your money go? For most households it is housing
and most Americans are too broke to afford a home.
For younger Americans the biggest expense is college tuition. And
inflation in tuition has gone completely out of control because debt has
been disconnect from ability to pay (does this bring back memories of
the housing bubble?). There is an inflation nightmare going on and you
only have to look back to 2000.
The four horsemen of inflation
There are four major issues that are impacting inflation and hitting your pocketbook. You might not feel it immediately but when wages are stagnant, it does make a big impact. So it might be useful to look at the various segments that are hurting your pocketbook.
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