Tuesday, August 14, 2007

Up Is Down

The headline on Bloomberg: Inflation Eases.

The actual numbers in the PPI?

Producer prices increased 0.6% for the month. Core prices (producer prices minus energy and food) rose 0.1%.

Bloomberg, CNBC and the other shills are focused on the core number.

Hey, core inflation is tame - it's only up 0.1%

Uh, huh - as long as you don't have to eat, heat/cool your office/factory/house, drive or buy anything that needs to be transported, inflation is down!!!

Otherwise, it's up 0.6% - a much higher increase than economists predicted.

If I remember correctly, Bernanke said before Congress in July that he was paying attention to overall inflation prices, not just core prices, because food and energy costs have been so elevated for so long.

Nonetheless, Bloomberg reports that today's PPI numbers means Bernanke can cut interest rates because inflation is "tame."

Up is down, war is peace and 0.6% inflation is "tame."

Comments: Post a Comment

<< Home

This page is powered by Blogger. Isn't yours?