Posted on 06/25/2010 3:30:03 AM PDT by Scanian
The Federal Reserve has another problem -- it just doesn't know it yet.
The Fed didn't make any change to the interest rates it controls at the policy-making Open Market Committee meeting yesterday and said "inflation is likely to be subdued for some time."
Well, maybe not for long -- at least as far as the government's statistics are concerned.
Two years ago this column broke the news that something was amiss in the government's inflation reports, particularly the closely watched Consumer Price Index.
In a column on May 20, 2008, I quoted a top government economist who helped put together the CPI for the Bureau of Labor Statistics (BLS) as saying that inflation was "going to show huge increases" in later months.
That was a blockbuster revelation to Wall Street. And it turned out to be absolutely correct.
The reason, the economist explained, was simple. The recession in the spring of 2008 had distorted the seasonal adjustments that are done to the CPI numbers and had caused the increase in energy costs to be understated for several months. Anyone who understands seasonal adjustments knows this: What the adjustment giveth it also taketh away.
So, if energy costs are understated in the spring, they must be overstated in later months until the overall effect of these adjustments is neutral.
(Excerpt) Read more at nypost.com ...
...the government never has a problem, it’s citizenry does
Problems are the life blood of the socialist state. The more problems, the more call for state growth. Modern state planning doesn’t rely on passively waiting for random problems, but now manufactures a steady stream of ‘opportunities’ for state growth.
Obama policies are designed to make those numbers worse and keep them that way. That might be the main thing Obama wants to accomplish: destroy the economic engine with the corollary of killing the desire of half the population toward self improvement.
WE THE PEOPLE will have a MAJOR PROBLEM with it... it is raging in the wholesale world now. Fuel went up 12 cents yesterday... oil will flow for a long time into the Gulf... food is skyrocketing... and we are in a depression... dang... the dims are truly evil and POWERFUL! America dies while obama parties and spends.
LLS
We still have deflation ~ just like during the Great Depression.
Inflation is not measured by changes in Commod. Prices, well it may be for Govt CPI purposes, but that is just more beurcratic easy for Joe citizen to understand stuff.
Inflation has one true meaning: the increase of the money supply above the savings rate. Inflation isn’t caused by a shortage of wheat or corn or oil, it is caused by one thing and one thing only: central bankers shrinking their reserve ratios.
And, right now, everything has gone up..I certainly notice that our basic necessities cost much more than they did a couple of years ago. No one can tell me that inflation is not raising it’s ugly head. They just pull out their “created” accounting numbers and feed those to the public. Citizens, and especially those on a fixed income, know better.
I am not a smart man, but I know that printing extra money as fast as Obama can spend it , is not going to help solve an inflation problem , and I know that saving money now that will have it’s value halfed later isnt the best move to make.
What to buy is the problem. Land used to look good before it was over valued.
unexpectedly.
Inflation is the life blood of a corrupt leftist state. Inflation reduces the worth of savings, investments, IRA’s to essentially zero. So people who worked and saved all their lives are made poor, just like the people who collected checks from the government while puffing away at their pot.
Inflation is built into the system. The only reason why we don’t have runaway inflation right now, under the present leftist regime, is that millions are out of work, and those who have jobs are making 1/4 of what they were once capable of making.
I don’t believe the CPI measures inflation. it is used to set pension and social security payouts, so it is kept artificially low. Go out and buy something. A car battery, lumber, seeds, food, heating oil, propane, or asphalt shingles - They all have skyrocketed in price. A tractor battery went from $50 to $88. We are in a major inflation episode and only the Lord knows where it will stop. Not the clowns that we have in Washington.
from crisis to crisis...the Obama way purposely
The economy has a government problem.
those on a fixed income........
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That asinine “fixed income” phrase has to be struck from the language ,, I’m in Florida and am positively raped to pay the “income” I hear the old people complain about as they get their free “senior” coffee at McDonalds while I pay full price... WE ARE ALL ON A FIXED INCOME ... I cannot snap my fingers and magically double my income ,, CAN YOU!
Inflation happens when the USA has Democratic Presidents and Democratic Congresses at the same time.
The legendary inflation of the late 1960s and 1970s started with President Lyndon Johnson, was tamed somewhat by Nixon, but reared its ugly head with a vengeance after Watergate. Once Carter took office matters were the worst ever — 15% inflation every year. Reagan tamed it.
Clinton had a Dem Congress for only 20 months and couldn’t do much damage.
But Obama, during his 20 months, will have done enough damage with his trillion-dollar spending to bring inflation back.
Refinance your homes now if you still have an ARM, or fixed converting to ARM. NOW.
You're right.
I’m in accord with you.
I pulled the equity out of my house and refi’d for 30 yrs @ 5% fixed.
I’ll pay it back with Obama minibucks.
And, always they have the need to manufacture domestic enemies. Oil companies, finance, big....( fill in the blanks ).
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