CPI Goes Higher on Food, Energy, Transportation, Medical, Tuition & Books, Restaurants, Alcohol, Rent, etc.
If you are purchaser of computers, women’s clothing, or household furnishings, well then I have some good news for you: Everything is on sale, and prices are falling!
However, if you regularly buy Fuel, use transportation, need hospital services, education, books, eat food at home, pay tuition, require medical care, eat out, drink booze, or pay rent, well, sorry: Everything is costing you more.
Even if you back out food & energy — inflation ex-inflation — we still have rising prices, and elevated inflation expectations.
This leaves the Fed painted into a corner — the weak dollar, caused in large part by low rates, is adding to inflation. But the recession and the credit crunch are preventing the Fed from appreciably raising rates.
Here’s your cost increase picture, measured year over year:
click for bigger graphs
Gary Shilling, president of A. Gary Shilling & Co., talks about the outlook for the U.S. economy, dollar and Federal Reserve monetary policy.
00:00 Outlook: "big nose dive in consumer spending"
01:10 Discrepancy between unemployment, payrolls
02:26 Prospects for Fed policy, bond market
05:26 "Very optimistic" on U.S. dollar
07:26 China’s economy, growth outlook
Shilling Sees ‘Big Nose Dive’ in Consumer Spending June
Bloomberg, June 11 2008
Here’s today’s earlier CNBC appearance on Market Pulse Check:
I like David Katz of Matrix Asset Advisors value approach, but we (obviously) have some sector disagreements — that’s what makes a market!
Airtime: Thurs. Jun. 12 2008 | :43:0 08 ET
A look at where this market is headed, with David Katz, Matrix Asset Advisors and Barry Ritholtz, Fusion IQ