No inflation? Fed ...can't find much inflation. Consumers might argue...

[joeunderdog]

NEW YORK (CNN/Money) - The Federal Reserve sees so little inflation in the economy that it's more worried about an "unwelcome fall" in inflation than an unwelcome rise.

Take a look at what's going on with prices, and you might wonder where the Fed is getting its information.

snip

From September of last year to September this year the cost of education, according to the CPI data, has risen 7 percent. Medical costs are up 4 percent, utilities are up 8.6 percent. All of these much higher than the overall CPI, which grew at just a 2.3 percent rate, and the "core" CPI, which excludes food and energy prices because they're so volatile, and which grew just 1.2 percent.

"The things that make up the bulk of consumer expenditures for most U.S. households -- all of them seem to be moving up significantly," said Carlos Asilis, portfolio manager with the hedge fund Vega Asset Management.
more...

http://money.cnn.com/2003/11/14/markets/inflation/

Boy can these guys cook a book!

[shirlden]

1. I knew that!!

When you live on fixed income and fixed outgo and the outgo doesn't cover what it did a year ago, you know you have inflation. I really did not need an expert to tell me that....my checkbook let me know.
If anything can beat Bush* it will be the balance in checking accounts eroding away. It's the economy, stupid.!

:argh:

[cthrumatrix]

25. The reason that don't report inflation -- rates going up - hurt the stocks

And coporate pensions need to recover badly --- the market stayiing high and improving is important for more than you think.

If you raise rates...people go to CD's as an option to stocks...bonds might look better...

They play with the index alot...it's by design and is corrupt.

[cornermouse]

2. They've been shrinking the size and volume

at the grocery store. Sort of a silent inflation.

[beawr]

3. Well, considering our obesity, that might be good

wink, wink

[truth2power]

17. Beat me to it.

I was going to say this, but you beat me to it. Start paying attention to how many food items have reduced the number of ounces.

The same as getting less for the same price, which amounts to increasing the price. One example: Most of the national brand yogurt -Dannon, Yoplait etc. - is now reduced to 6 oz. from 8 oz. Strangely enough, they manage to make the container about the same height as before, so you wouldn't notice unless you read the contents. I would bet that most shoppers don't even notice. Shameless. x(

The house brand yogurt where I shop is still 8 oz. and is every bit as good as Dannon etc. IMO. I buy that. Tired of being manipulated by these corporations.

[leetrisck]

4. Ask anyone about their car insurance &

Homeowner's insurance about inflation. Massive changes but of course we are getting "free" terrorism insurance. Every city, county and state in this country has raised every fee, fine, tax that they can find and we are paying a very heavy price out here for the bush mis-administration. There never was a tax rebate or reduction in taxes - we all actually got a tax increase and now with the deficits, we have a "birth tax" - how much do you owe the day you are born.

[shrike]

8. yep

Property taxes shot to the moon this year, and everyone around here is experiencing sticker shock.

[electricmonk]

5. They're right

My paycheck didn't inflate. We were told no raises this year but they might reevaluate the situation in March. Which of course come March they will say, "damn the luck we're still having a bad year, don't pay any attention to the fact you're working your ass off, we just can't afford to give you any more money."

[llmart]

6. How about everyone's heating bills?

I work with the public and just about everyone I work with and encounter daily is complaining about how their heating bills have almost doubled, and that's not even for this week's extreme cold. I know that our household budget has taken a serious hit since * was selected.

[shrike]

10. we just put in a new furnace

Energy-efficient. We figured it's worth the expenditure because (hopefully) our bills will be cut in half.

[Lorien]

18. I can't afford fuel oil anymore

so this year I just have three space heaters going, and I stay out of the rest of the house. Fuel oil cost me over $1,100 last year!

[mbperrin]

7. Hmmm..medical, education, food, energy, utilities all up and up..

Well, thank God paper clips are still cheap so that these bastard accountants can clip together their lies!

[bahrbearian]

11. Giggling

[teryang]

9. Exactly right!

Elements of computed rent have risen and they have nothing to do with mortgage rates. Insurance has increased steeply and so have state and local ad valorem taxes. I bought my home in July 2002. Total mortgage payment including taxes and insurance was $850 a month. With the increase in ad valorem taxes and tax assessment my payment is now $979.00.

One reaction of local governments to the economic downtown, reduction in tax revenues and reduction in federal funding has been to reassess all property values in their jurisdictions. Additionally they have raised tax rates. Insurance companies and utilities have gone beserk raising rates at 10 and 20 percent annual levels wherever possible with republican governments in power.

Constrast this and "Walmart" corporate tax exemptions with homestead exemptions that haven't been raised for homeowners for generations.

The rental market is suffering (commercial and residential)and empty homes and apartments exist everywhere because rents cannot be raised high enough to meet the new tax and insurance burdens.

[bikebloke]

12. My rent just took a mighty leap.

Up 100 USD in one bound. Though I reckon I shouldn't gripe. It's been below the area norm for a while.

At least they're measuring inflation on things that count. Like yachts and polo ponies.

[Cronus Protagonist]

23. My rent went up 10% last year

I'd say, since that's the largest part of my income gone, that I'd experienced at least 10% inflation last year alone.

"FUCK Bush" Buttons, Stickers & Magnets

[loudnclear]

13. Greenspan can find no inflation now, when there is some but he could

find the "threat of inflation" when Clinton was in office when there was none.

Food, fuel, and education. Try these for inflation. The only place no inflation exists is in your pay checks.

[Pale Blue Dot]

14. They know that inflation is the death knell for the economy

This lack of inflation is the only thing propping it up.

I'm starting to save string!

[stevebreeze]

15. here is how some of the cooking is done

It used to be based on a fixed basket of goods. Now if for instance you can no longer afford the stake you had grown accustomed to and can afford only chicken, the price of the chicken is substituted for the price of the stake. So in effect inflation is based on what you can afford not what it costs. Cost cutting by consumers is seen as moderating the effect of inflation rather then the lower of your living standard.

:kick:

[DrBB]

19. So if my rent doubles

...and I have to move into a cardboard box on the street, what matters is whether the box I pulled out of the dumpster this year doesn't cost any more than if I'd pulled it out of the dumpster last year?

Well, that makes sense to me. No point counting the cost of that unit I was evicted from--I'm not paying that rent anymore. Plus don't they factor in the improvement in quality now?

Because in our system quality is improving all the time. That box you hauled out this year is a much better box than the same dumpster dive would have procured for you last year. So even though the cost is the same, your quality of life has improved over the standard of living you would have had as a box-dweller last year, if you'd been one then.

So in fact, inflation has gone DOWN!

[54anickel]

16. T Jefferson warned of this, very sad how true it rings today

"If the American people ever allow private banks to control the issue of their money, first by inflation and then by deflation, the banks and corporations that will grow up around them will deprive the people of their property until their children will wake up homeless on the continent their fathers conquered."

[Bandit]

20. Well I beg to differ

I am a Food wholesaler and Prices are going up up up. Soda pop is taking a pretty good sized jump and ice cream is going up 5%. Feb. 1st is the day most of my prices rise and it won't be pretty but my workmans comp took a 20% jump this year and general liability went up even more. Freight cost went up 5.5% from my main freight agent. It doesn't sound like much but I spend close to a half million dollars a year just in freight. That is another twenty-five grand out of my pocket. French fries have gone up an additional 10% and onion rings went up 20%. No inflation my ass. LIES LIES and more LIES from this Cabal and I consider Greenspan part of it.

[BiggJawn]

21. Oh, but they're right, there IS no "inflation"....

Just good, old-fashioned Vanderbilt-style greedy GOUGING.....

[salin]

22. good story - but not lbn... this is from November

but it fits well with the item a week or so ago suggesting how the index is rather 'cooked' in terms of what is selected for inclusion.

[54anickel]

24. Did you catch the trick they are using with housing?

In computing the CPI, the Bureau of Labor Statistics assigns a 22.2 percent weighting -- the most of any item -- to something called "owners' equivalent rent of primary residence." Basically, it's an estimate of what homeowners might pay in rent if they rented their homes instead of owning them.

To calculate this, the BLS looks at actual rents, compares them to owned residences and then uses that to calculate housing costs.

The problem? The low-interest rate environment has meant that many people who might otherwise rent now own -- in fact, home ownership rates are at record highs. As a result, rents have come under pressure, and "owners' equivalent rent" has grown at just 2.1 percent over the past year -- less than the overall CPI and far lower than the costs for education, health care and so on.

You can catch the circularity here. Because the inflation reading is low, rates are low, which has upped home ownership, which has pressured rents, which has put a cap on "owners' equivalent rent," which has helped keep the inflation reading low. Etc.

[flaminbats]

26. This is Greenspanspeak for saying that the economy isn't moving...

Remember how he thinks...

Inflation is a sign of a booming economy. Deflation is a sign of a shrinking economy or a depression. And somewhere in between is where most bankers and Greenspan types like to set the price for borrowing and economic growth. When the economy is booming, Greenspan raises the interest rate to slow down economic growth and thus raise the price for borrowing needed to buy a house or start a business. In Greenspan's view he isn't slowing the economy..."but preventing an economic Holocaust afterward." Greenspan sees low inflation usually as a good thing except now he is extremely worried. His fear is that we may enter a cycle of deflation and depression. Prices will collapse but so will wages, profits will tumble and unemployment will grow just as quickly.

What is the Greenspan solution? Why to lower rates of course! Greenspan, as usual is looking at the problem but not at the root causes. What are the causes of deflation...they include bank mergers, overpriced loans, and the decreasing ability for local banks to compete with national banks...thus reducing investments available for locally owned business expansion and hirings.

What good does increasing interest rates have when only one bank survives to make loans? And what good will decreasing interest rates have if it also drives all of the community lenders out of business?

[indepat]

27. It's all "play like": they play like the increases in eggs, milk, beef,

prescription drugs, other medical cost including medical insurance, local taxes, gasoline, natural gas and a veritable plethora of other items that have rapidly increased in price really don't make that much difference in the typical family budget.