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Consumers shutting down as US economy deflates
CNBC ^ | 14 October 2015 | Jeff Cox

Posted on 10/15/2015 9:16:50 AM PDT by Lorianne

The math is pretty simple: A lack of purchasing power for consumers has led to a lack of pricing power for companies.

When it comes to the U.S. economy big-picture outlook, the ramifications are more complicated, and not particularly pleasant.

Wednesday's producer price index reading, showing a monthly decline of 0.5 percent, demonstrates a larger problem: At a time when policymakers are hoping to generate the kind of inflation that would indicate strong growth, the reality is that deflation is looming as the larger threat. Declining prices often would be treated as a net positive by consumers, but income weakness is offsetting the effects.

Even Wall Street is feeling the heat. Prices for brokerage-related services and financial advice dropped 4.3 percent in September, accounting for about a quarter of the entire slide for final demand services.

(Excerpt) Read more at cnbc.com ...


TOPICS: Business/Economy
KEYWORDS: consumer; consumerspending; consumerstaples; deflation; economy; foodprices; globalcrisis; inflation; obamanomics; obamasamerica; stockmarket; uscrisis
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1 posted on 10/15/2015 9:16:50 AM PDT by Lorianne
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To: Lorianne

19 trillion in debt. 100 million out of the work force. Record food stamps. 11 to 30 million illegals stealing American jobs.

Yes we can!


2 posted on 10/15/2015 9:18:35 AM PDT by TigerClaws
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To: Lorianne

Obama’s Wreckovery Year 7 Plan on schedule...


3 posted on 10/15/2015 9:19:02 AM PDT by Hotlanta Mike ('You can avoid reality, but you can’t avoid the consequences of avoiding reality.’)
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To: Lorianne

104 million working age people on their asses. Not sure what the total working age segment comprises, but I’ll wager its around 350 to 400 million.

25%

Inflation: a pound of hamburger is over $5/lb. Apples are $2/lbs. Vegetables and fruits are more expensive than processed foods.

Fees are up everywhere. Property taxes are up regardless of property values. Health care costs are skyrocketing.

So, yeah. Even the Socialists on the stage the other night admit it isn’t working, which is funny to watch, since they are calling for more of it.


4 posted on 10/15/2015 9:21:10 AM PDT by RinaseaofDs
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To: Lorianne

And the GOP (led by Boner and the b*tch) has stood back and let this continue by failing to respond to the “most transparent administration” in history. It is obvious what the intent of this administration has been all along.


5 posted on 10/15/2015 9:21:52 AM PDT by WKUHilltopper (And yet...we continue to tolerate this crap...)
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To: Hotlanta Mike
Obama’s Wreckovery Year 7 Plan on schedule...

Si! Se puede!!

6 posted on 10/15/2015 9:23:54 AM PDT by Don Corleone ("Oil the gun..eat the cannoli. Take it to the Mattress.")
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To: Lorianne

The source I checked for what follows is CommoditiesOnline.com .

The US economy was level, or actually down some, in September. But sales of silver....eagles, bullion etc are up substantially. That would indicate that people have lost confidence in the economy for the near future. If we’re hoarding silver, it’s likely we’re hording cash, too, and cutting down on unnecessary purchases.


7 posted on 10/15/2015 9:24:10 AM PDT by grania
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To: Lorianne

Inflation does not indicate growth. It is the dividing of the unit of vallue into smaller and smaller units and causes economic dislocations and increases inefficiency. “Inflation” without a modifying adjective is purely and only the increase in the money supply i.e. a larger total of smaller units of value. Any other use of the unmodified term is obfuscation, camouflage and, in another term, bullshit.


8 posted on 10/15/2015 9:25:58 AM PDT by arthurus (Het is waar. Tutti i liberali sono feccia.)
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To: Lorianne
At a time when policymakers are hoping to generate the kind of inflation that would indicate strong growth...

Sounds more like the "kind of inflation that lets us cook the books." There may be deflation in some commodities prices, but it's certainly not reflected at the consumer level. If you take gasoline out of the equation, virtually every other consumer item costs more, while wages are either flat or going down.

When consumers have less to spend on things that cost more, consumers don't buy as many things. Seems pretty simple.

9 posted on 10/15/2015 9:29:52 AM PDT by henkster
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To: Lorianne

“hoping to generate the kind of inflation that would indicate strong growth”... yet everything they do discourages growth!
Giving people money to consume is not the same as people creating wealth to get money to consume.
There is no growth.

And borrowing to give people money to consume is an economic death spiral.


10 posted on 10/15/2015 9:30:10 AM PDT by mrsmith (Dumb sluts: Lifeblood of the Media, Backbone of the Democrat/RINO Party!)
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To: grania

Capital Strike!


11 posted on 10/15/2015 9:30:55 AM PDT by griswold3 (Just another unlicensed nonconformist in am dangerous Liberal world.)
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To: Lorianne

obamacare cost me about $3000 this year, and with my health-care “co op” going out of business, I’m expecting to get screwed again for 2016

Sorry, that’s money that I WON’T be spending on a new car, vacations, iPads or restaurants.


12 posted on 10/15/2015 9:33:22 AM PDT by PGR88
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To: RinaseaofDs

Inflation: a pound of hamburger is over $5/lb. Apples are $2/lbs. Vegetables and fruits are more expensive than processed foods.

*****************************************

My strategy (from necessity): Gardening & hunting .... saves a lot of $$ on produce and beef (we don’t eat beef any more unless some else is doing the buying/cooking). So does shopping at Goodwill or other thrift stores for clothes, shoes, etc. Hand make all my presents (Christmas, birthday, etc.). I can’t tell you the last time I was at a “mall”.


13 posted on 10/15/2015 9:33:25 AM PDT by Qiviut (Stand up for Jesus, ye soldiers of the cross; lift high his royal banner, it must not loss)
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To: RinaseaofDs

USA population is currently 318.9 million so 319 ... officially. Not all of that number are of working age.

According to this source there are 203 million working age persons (people between the ages of 15-64).
https://research.stlouisfed.org/fred2/series/LFWA64TTUSM647S

Of course not all of those of working age want a paid job at a given time. Many are full time caregivers of their children or elderly parents, many are teenagers or young adults in college and some number are disabled, some do unpaid volunteer work, etc. On the flip side, many people are working past age 64 so maybe it evens out.


14 posted on 10/15/2015 9:36:21 AM PDT by Lorianne
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To: TigerClaws

“Yes we can!”

Drunkin Boner & McConnell

“Yes we can TOO! “


15 posted on 10/15/2015 9:37:18 AM PDT by stephenjohnbanker (My Batting Average( 1,000) (GOPe is that easy to read))
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To: Qiviut

Pork is still reasonable. I’m buying that.

Thanks to the legislature, even eggs as protein is out due to $6/doz eggs.


16 posted on 10/15/2015 9:37:32 AM PDT by RinaseaofDs
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To: Qiviut

Couple days ago in this town ALL the major coffee brands (not beans, I’m talking normal coffee) shrunk their containers from around 30 ounces down to 22 or 23 ounces.

All of them. Same day. Big sale signs $8.95!!!

Prior to the 2008 crash coffee containers were nearly uniformly 32+ ounces. The first container shrinkage came them but not every brand at once.

Nine bucks for 23 ounces for Folgers. Don’t tell me there’s no f’n inflation.


17 posted on 10/15/2015 9:39:42 AM PDT by Fightin Whitey
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To: Lorianne

But everything is great! Warren Buffett said so...


18 posted on 10/15/2015 9:39:49 AM PDT by SteveinSATX (C'mon Cruz, Trump or Carson ...baby needs a new pair of shoes!)
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To: RinaseaofDs
Not sure what the total working age segment comprises, but I’ll wager its around 350 to 400 million.

I'm thinking you're figures are a tad high. Just sayin'.

19 posted on 10/15/2015 9:43:28 AM PDT by Jeff Chandler (Step away from the Koolade.)
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To: Lorianne

The economy may deflate but the government budgets just keep inflating up and up.

It is far past time for congress to eliminate the idiotic inflationary practice of baseline budgeting and replace it with zero base budgeting.

Baseline budgeting is the process lazy and venal politicians have invented that allows the federal budget to automatically increase every year without then having to lift their sticky fingers.

Check it out here:

http://townhall.com/columnists/terrypaulson/2012/05/07/time_to_end_the_us_debt_accelerator_baseline_budgeting/page/full


20 posted on 10/15/2015 9:43:41 AM PDT by Iron Munro (The wise have stores of choice food and oil but a foolish man devours all he has. Proverbs 21:20)
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