Is Concern for Inflation Inflated? 10 comments
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The chart above (click to enlarge) shows the growth rates (from a year ago) for the monetary base and M1 money supply since 2005. M1 has been flat with zero growth for more than 2 years, and the growth in the monetary base has been declining and is now approaching 0% growth.
Given these monetary data, is the concern about inflation inflated?
CPI inflation at an annual rate has fallen in each of the last four months, and is at the lowest rate in six months (since October 2007).WASHINGTON -- U.S. consumer prices were under wraps last month, a government report showed, especially when food and energy prices were stripped out, further evidence that the economic slowdown is easing some of the inflationary effect of recent sharp gains in food and energy prices.
Consumer prices rose 3.9% on a year-over-year basis, down slightly from the prior month (see chart above). The core CPI grew a more modest 2.3% compared to April 2007. Over the past three months, core inflation rose at only a 1.2% annual rate.
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This article has 10 comments:
I wonder how you got your phd in economics - or then again, it makes perfect sense.
first, inflation and cpi increases are different matters and M1 monetary growth is still different from the two. btw, there certainly is a reason to it, that the govt stopped publishing m1, isn't it?
second, the phony cpi numbers are a joke, especially those published today. gasoline was down 2% as reported making for FLAT ENERGY PRICES while the oil bull was ranting louder than ever. alas, gasoline actually was up 5.6% as per govt's statisticians but ya know, as copnsumers expect a seasonal rise anyway, the govt's bureaucrats marked gasoline prices down 2% instead of their actual 5.6% rise. Uhm, that looks quite prudent, doesn't it?
not before too long, inflation will be zero to negative - becuase consumers expected it to be 5% - so measured against that the price rise of 5% was basically a flat number.
Sure.
If your students aren't up in arms against your dumb repetition of cooked government statistics, then I fear the worst for America's future economists and corporate managers.
that hard up to be taken seriously, that this exact article is being reposted under a different story title?
I thought we took this clown apart before, with all our other previous comments.
I want everyone tomorrow at some point to spend an hour at the grocery store and an hour at the gas station, talking to average americans and ask them of they think there is any inflation.
I mean talk to the 90% of Americans that only own 10% of this country's net worth, not the 10% that controls the other 90%, of which Mr. Ph.D Mark Perry I am sure belongs to.
Don't be fooled by the phony government numbers or the pump monkeys, who are part of the elitists that run our country. All they want is to make money off of what they hope is our ignorance of the truth.
I understand that you enjoy adding a quick writeup on SA from time to time, but when are you going to give us some of the work that you're capable, as an academic, of producing yourself? Why don't you and your students gather data on the median Michigan family and head out to Meijer and gather REAL data on price inflation and show us some of your own data on the subject. As we all know, we can't trust someone else's data, particularly when we can't replicate it ourselves (i.e., your referenced Gov't data). Take some time off from the arduous task of regurgitating someone else's information and bring us some of your own.
TakebackTheFed.com
"You’re neither right nor wrong because other people agree with you. You’re right because your facts are right and your reasoning is right—and that’s the only thing that makes you right. And if your facts and reasoning are right, you don’t have to worry about anybody else." –Benjamin Graham
The government numbers deliberately FALSIFIES inflation data to keep social security and medicare payments depressed. Recall the formulation on calculation has changed twice over the last thirty years. If you believe that gas went down 2% last month then please tell me where? I dare you to find it. That is a journalistic (where's your credibility) challenge. If you really believe the governments bogus calculations for "seasonal" adjusted price then we would be paying a little over $3/gallon versus the close to $4 we are paying nationwide. This is in complete disagreement with the EIA which reported that gasoline rose by 9.5% in April, from $3.29 to $3.60/gal. That my friend is a ONE MONTH change! And YUP, it's not annualized! And you expect us to believe the government?
I think we should require the government to sell every item that they use to calculate the CPI. Maybe then we would get some truth.
On to my next point, the M1 has to do with the monetary growth it is not dealing with consumer price inflation. And honestly how can you even trust that data when they stop publishing it.
To help you out hear is what you need to do to calculate real inflation cost. Use this equation: ((B - A)/A)*100 B=Price of the item you paid for today A=Price of the same Item you bought last month. That will tell your own person CPI and you can see what the real rate of inflation is and how it is affecting your spending.
By the way, you should sue the school you got that degree from because they didn't pass any common sense along with it.