Hyper inflation is coming! What you say, we now have record deflation!

[GHook93]

Wholesale Prices Fall More Than Expected in July - Political News - FOXNews.com

All I kept hearing about was hyper inflation will be upon us after the stimulus bills were passed. I admit I shook in my boots. It seemed very logical. The deficit grew to where they said it would be, but no hyper inflation has occured. Spouts of inflation, but no hyper inflation. Now we have deflation!



I have no idea what to believe anymore! This is primarily the reason I refuse to listen to the scare tactics on healthcare!

 

[waltky]

Guess gas prices got `em scared...

Sharp disagreement among Federal Reserve members
April 5, 2011 -- Members of the Federal Reserve are in sharp disagreement about how to address rising prices. The central bank might need to tighten the reins on the economy before the end of the year to stave off inflation, said some members of the central bank's policy-setting body.

But others appeared comfortable holding off on taking any action, according to the minutes of the Fed's March 15 meeting, released Tuesday. "A few participants indicated that economic conditions might warrant a move toward less-accommodative monetary policy this year," read the minutes -- Fed-speak for raising interest rates or selling assets to try to curb inflation. "A few others noted that exceptional policy accommodation could be appropriate beyond 2011."

Last year, the Fed embarked on a huge round of asset purchases designed to spur lending by pumping trillions into economy, known as quantitative easing. This most recent effort, called QE2 because it is the second round of such purchases, is due to be completed in June. Rising oil and other commodity prices over the last few months had sparked debate among members about whether the Fed should continue the program, and risk prices getting out of hand. Some of the more vocal inflation hawks at the Fed have expressed concern that the policy could lead to a spike in prices down the road.

Nevertheless, none of the members objected to continuing the program through to completion at the March meeting, though some left the door open for an early wind-down of the asset purchases at a later date. "A few members noted that evidence of a stronger recovery, or of higher inflation or rising inflation expectations, could make it appropriate to reduce the pace or overall size of the purchase program." Members also reported that their business contacts "were passing on at least a portion of these higher costs to their customers or that they planned to try to do so later this year."

MORE

 

[waltky]

Granny says the gov't. don't ever level with ya, dey use accounting tricks to make it look less bad so's ya don't really know how bad it is...

Inflation Actually Near 10% Using Older Measure
Tuesday, 12 Apr 2011 | After former Federal Reserve Chairman Paul Volcker was appointed in 1979, the consumer price index surged into the double digits, causing the now revered Fed Chief to double the benchmark interest rate in order to break the back of inflation. Using the methodology in place at that time puts the CPI back near those levels.

Inflation, using the reporting methodologies in place before 1980, hit an annual rate of 9.6 percent in February, according to the Shadow Government Statistics newsletter.

Since 1980, the Bureau of Labor Statistics has changed the way it calculates the CPI in order to account for the substitution of products, improvements in quality (i.e. iPad 2 costing the same as original iPad) and other things. Backing out more methods implemented in 1990 by the BLS still puts inflation at a 5.5 percent rate and getting worse, according to the calculations by the newsletter’s web site, Shadowstats.com.

Investors are anxiously awaiting the release of March’s CPI reading on Friday. The consensus estimate from economists is for an annual inflation rate of 2.6 percent. “Given ongoing inflation problems with food and the spreading impact of higher oil-related costs in the broad economy, reporting risk is to the upside of consensus expectation,” said Williams, citing a 10 percent jump in gasoline prices in March, in the note.

“While the federal government would have us believe the numbers are rather tame, our own personal gauge leads us to believe inflation is running between 5 percent to 6 percent annually,” wrote Alan Newman in his latest Crosscurrents newsletter that refers to Williams’ statistics.

More http://www.cnbc.com/id/42551209

 

[waltky]

Granny havin' to raise prices on apples she sells onna street corner `cause dey costin' her more...

Americans Feeling Pinch from Inflation
April 20, 2011 - Inflation is hitting U.S. consumers hard. The last era of severe inflation was in the 1970s, when prices and wages spiraled upward. This time, while the official inflation rate is still relatively moderate, wages are stagnating and prices for essentials like food and fuel are rising.

Ashwarya and Alok Sharma and their two children emigrated to the United States from India 10 years ago. They are now U.S. citizens. Like most Americans, they are feeling the financial pinch from inflation. Consumer prices overall are rising at a 2.7 percent annual rate, while average hourly wages increased by just fraction of one percent. Alok Sharma says something has to give. “It is hitting both ways because you don’t get well paying jobs, and you don’t get a raise. And then inflation hits you on the other side," she said.

Economists say energy and food costs are driving inflation, and Americans are looking for answers. The Sharmas live in a suburban neighborhood north of Washington D.C. They work in the computer field and commute 65 kilometers round trip each day to work. Gasoline prices have risen about 26 cents per liter during the past year. Alok Sharma says that is taking a big bite out of his family's budget. “Our gas bill has gone up 40, 50 percent," he said. The Sharmas are vegetarians. They eat a lot of fresh vegetables. And they drink a lot of milk, which Ashwarya Sharma says has doubled in price. “Like almost a year back it was $2 a gallon [i.e., about 53 cents per liter]. Now it is $4 a gallon [about $1.06 per liter]," she said.

They estimate that their food costs have risen 25 to 30 percent during the past six months. Alok Sharma says that if prices continue to increase, his family will have to cut back and consider lifestyle changes. “Still we are in the habit of getting whatever we want, what ever children demand. Gradually I think we have to make our choices only for cheaper items," said Sharma. Some say the expanding middle classes in countries like China, Brazil, and India are consuming more resources and driving up prices worldwide. Other experts say drought in places like Russia, turmoil in the Middle East and a global lack of refinery capacity have driven up food and oil prices.

MORE

 

[waltky]

Granny says if prices goin' up - what's the difference?...

Bond market is worried. You should be too.
May 13, 2011: Inflation fears are everywhere these days thanks to surging commodity prices. You're even starting to hear some experts talk about stagflation, a phenomenon that, much like disco and bell bottom pants, would be better off remaining a relic of the 1970s.

But the bond market isn't falling for the inflation talk. Yes, commodity prices are, to quote perennial New York state political candidate and YouTube star Jimmy McMillan, "too damn high." And that's starting to impact wholesale prices and consumer prices. That isn't the same thing as inflation though. Inflation is usually the byproduct of a strong economy, particularly one where wages are growing rapidly. That's not happening now. And that's why the yield on the U.S. 10-year Treasury note is still a very low 3.16%.

Bond prices and rates move in opposite directions. Yields tend to go up when the economy is robust. That's because there is less incentive to buy stodgy Treasuries at a time when riskier assets like stocks look more rewarding. So the fact that bond yields are still a lot closer to 3% than 4% shows that fixed-income investors are still nervous about the economy, a stark contrast to stock market investors who have a gung ho approach thanks to strong earnings

"The bond market doesn't seem to be worried about inflation but bond investors seem to be apprehensive about the economy," said John Kosar, director of research with Asbury Research in Chicago. "That's not a good sign. In general, the bond market is the one that tends to get it right." The allure of U.S. bonds as proverbial safe havens also seems to have increased thanks to the latest debt woes in Greece and other parts of Europe. Fund tracking firm EPFR Global reported Friday that U.S. bond funds had their highest inflows of the year this past week.

Whether or not bond yields continue to remain this low after the Federal Reserve's second round of quantitative easing, a bond buying binge more commonly referred to as QE2, ends next month is an open question. Some worry that rates will shoot drastically higher because the Fed will no longer be a buyer of last resort keeping yields as low as they have been.

More No inflation fears in the bond market -- The Buzz - May. 13, 2011

See also:

Triple-digit selloff on the Dow
May 13, 2011: Stocks fell Friday afternoon, with all three indexes down 1%, as the dollar gained ground and commodity prices pulled back.

The Dow Jones industrial average (INDU) slipped 117 points, or 0.9%, led lower by JPMorgan Chase and Bank of America. The S&P 500 (SPX) fell 12 points, or 0.9%, and the Nasdaq Composite (COMP) lost 33 points, or 1.2%. Tech stocks CA Inc., Nvidia and Yahoo were among the worst performers on both indexes. Stocks kicked off the session little changed Friday as investors took a step back at the end of a choppy week of trading. But the market fell under pressure in the afternoon as the dollar gained ground. The greenback rose 1% against the euro and 0.7% versus the British pound.

"Investors have been focused on short-term changes in the direction of the dollar," said Michael Sheldon, chief market strategist at RBC Wealth Management, adding that a stronger dollar can make it difficult for U.S. corporations to compete overseas, and in turn, cut into profits. The stronger dollar also weighed on commodity prices, which had been stable earlier in the day. Oil for June fell 0.6% in the afternoon to $98.42 a barrel, while gold futures slipped 0.9% to $1,494.20 an ounce. Silver futures rose 0.4% to $34.95 an ounce.

Stocks have been moving in tandem with commodities prices recently, falling hard earlier this week along with plunging oil prices but also following commodities back up on Thursday. "Investors are trying to figure out if the recent decline in commodity is a signal toward weak U.S. economic growth, or simply the rotation of money out of a hot, crowded area of the market," Sheldon said.

Economy:

 

[Stephanie]

I say, HOPE AND CHANGE BABY

Oh, and don't forget to vote for the Obama and his comrades in arms again in 2012 since we are "certainly" better off than we were before.