No Inflation or Deflation.

[Neubarth]

Core PPI for Dec 0.0%

 

[uscitizen]

So the economy is pretty much in a holding patten.
Deflation means it is going down and inflation means the economy is risinig.

 

[pinqy]

I always get confused by what statistics Neubarth will accept or not accept. He rejects BLS labor force statistics as phoney an denies there's even a survey, but he doesn't seem to have a problem with the PPI or CPI, even with seasonal adjustment, which he rejects for UI claims. It's fascinating.

 

[The Rabbi]

The "core" number is a BS number as it strips out things like energy and housing that people actually buy every day.
That said, there is no inflation, despite all predictions. I don't think that we will be unique in having huge money creation not followed by inflation. But I dont see it yet.

 

[pinqy]

The "core" number is a BS number as it strips out things like energy and housing that people actually buy every day.
That said, there is no inflation, despite all predictions. I don't think that we will be unique in having huge money creation not followed by inflation. But I dont see it yet.

The PPI is the Producer Price Index...it's not what people buy every day, but what stores and manufacturers buy. So housing's not a part of it anyway either. The core PPI is officially called "Finished Goods less food and energy."

 

[The Rabbi]

My bad.

 

[Paulie]

Deflation means it is going down and inflation means the economy is risinig.

This might be one of the dumbest things I've ever read.

 

[☭proletarian☭]

What is PPI?

 

[uscitizen]

The "core" number is a BS number as it strips out things like energy and housing that people actually buy every day.
That said, there is no inflation, despite all predictions. I don't think that we will be unique in having huge money creation not followed by inflation. But I dont see it yet.

The PPI is the Producer Price Index...it's not what people buy every day, but what stores and manufacturers buy. So housing's not a part of it anyway either. The core PPI is officially called "Finished Goods less food and energy."

Do manufactured products used in housing construction figure into the PPI?

 

[pinqy]

What is PPI?

It's the Producer Price Index: an index of price changes for wholesale goods..The 3 main indexes are Crude Goods (raw materials like logs, minerals and mineral ore, raw cotton, etc), Intermediate Goods (construction materials, raw foods wholesale prices, clothing material etc) and the main one usually mentioned as just "PPI" is Finished goods...everything bought by retail stores for sale, but also office equipment (wholesale prices), factory machines, etc.

This is opposed to the CPI, Consumer Price Index, which measures changes of consumer goods.

 

[pinqy]

The "core" number is a BS number as it strips out things like energy and housing that people actually buy every day.
That said, there is no inflation, despite all predictions. I don't think that we will be unique in having huge money creation not followed by inflation. But I dont see it yet.

The PPI is the Producer Price Index...it's not what people buy every day, but what stores and manufacturers buy. So housing's not a part of it anyway either. The core PPI is officially called "Finished Goods less food and energy."

Do manufactured products used in housing construction figure into the PPI?

Appliances and the like would be in the Finished Goods Index, Construction Materials like lumber and plumbing fixtures are in the Intermediate Goods Index.

Here's the table published for Selected commodity groupings by stage of processing There are other tables with other indexes looking at different aspects.

 

[☭proletarian☭]

Is it based purely on the number of dollars these thing cost, or on their real price, accounting for inflation (or, in theory, deflation) of the money supply?

 

[pinqy]

Is it based purely on the number of dollars these thing cost, or on their real price, accounting for inflation (or, in theory, deflation) of the money supply?

Since it IS a measure of inflation, it can't really be adjusted for inflation. Money supply effects are reflected in the price changes.

The short version is that the current index measure price difference since 1982 (except of course for goods not available in 1982) using shipping weights from 2002. So the formula basically looks like: 2002 quantity times current price divided by 2002 quantity times 1982 price. It's really a bit more complicated than that, but that's the basic idea.

Looking at the index numbers, 100 is the price in 1982, and the difference is the percentage change. So to pick a couple of examples, the footwear index is at 160.6, meaning a shoestore pays about 60% more today for their inventory than they did in 1982, and raw cotton is 97, so a textile factory is paying about 3% less for raw cotton than in 1982.

 

[Neubarth]

So the economy is pretty much in a holding patten.
Deflation means it is going down and inflation means the economy is risinig.

Inflation of moderate means usually accompanies a rising economy, but it is not ALWAYS so, so people will verbally smite you for having said that. For the most part, you are right.

 

[Neubarth]

Is it based purely on the number of dollars these thing cost, or on their real price, accounting for inflation (or, in theory, deflation) of the money supply?

Since it IS a measure of inflation, it can't really be adjusted for inflation. Money supply effects are reflected in the price changes.

The short version is that the current index measure price difference since 1982 (except of course for goods not available in 1982) using shipping weights from 2002. So the formula basically looks like: 2002 quantity times current price divided by 2002 quantity times 1982 price. It's really a bit more complicated than that, but that's the basic idea.

Looking at the index numbers, 100 is the price in 1982, and the difference is the percentage change. So to pick a couple of examples, the footwear index is at 160.6, meaning a shoestore pays about 60% more today for their inventory than they did in 1982, and raw cotton is 97, so a textile factory is paying about 3% less for raw cotton than in 1982.

Gosh, Pinky, I can not disagree with you. Your education has value here.

 

[Paulie]

So the economy is pretty much in a holding patten.
Deflation means it is going down and inflation means the economy is risinig.

Inflation of moderate means usually accompanies a rising economy, but it is not ALWAYS so, so people will verbally smite you for having said that. For the most part, you are right.

No, for the most part he is not right.

Inflation punishes savers. Only a certain portion of the economy benefits from inflation, just as only a certain portion of the economy benefits from deflation.

Both have their evils. Inflation is especially hard to deal with because wages typically don't keep up with the pace of inflation, so people have to use more of their hard earned dollars to make purchases, while they aren't making enough money to keep up with the extra expenditures.

Both inflation and deflation can break your bank account, just in different ways.

If you managed to keep your job in this time of deflation, you found yourself doing rather well because prices declined and now you were able to buy more and save more.

Also, in a time of serious inflation, it doesn't necessarily have to mean that jobs will be added. Companies can simply still refuse to hire. Now you have jobless people who have to spend MORE money on purchases.

Inflation forces the consumer to spend, while deflation forces the consumer to save.

Anyone who argues against saving is a fucking lunatic. And that's all I'm going to say.