Its Gold Jerry, Gold!

There’s an interesting debate today on Gold at Real Money. Some people actually think that Gold reflects future expectations for inflation
(sarcasm strictly intentional).

For those keeping track, I mentioned the GLD holders on Power lunch on March 30, 2005, (CNBC).

All this deficit spending may lead to higher rates, more inflation, and private capital crowded out, if left unchecked. 

Not too worry too muchMax Sawicky figures out how to pay for everything, from Katrina to Iraq to all other deficit spending.

One last thought:  As we noted in the past (here and here), the lack of increased supply in the 30 year Bond has sent managers after the 10 year. That, in my opinion, is a reason for part of the cinundrum.

When the 30 Year returns in February — we can expect to see that limited supply issue disappear — and that means rates ticking higher.

Category: Commodities, Economy, Fixed Income/Interest Rates

Except for Inflation, there’s no Inflation

So let me make sure I completely understand this: If we back out all of the inflationary data from the CPI, and PPI, there is, um, no inflation? 

Thanks for clarifying that.

While the Dismal Set — and the majority of CNBC guests — continue to spout such foolish nonsense, its nice to see that at least the WSJ wasn’t bamboozeled. Their online headline read:  Consumer Prices Climb 0.5%

"Gasoline prices shot up 8.3%, the biggest increase since February 2003.
Food prices, however, were unchanged for the first time in nine months.
Medical-care prices were unchanged after nearly 30 years of increases.
Housing prices grew more slowly in August, falling to a 0.2% rate from
0.4% in July. Automobile prices fell 0.5%, half the rate of decline
recorded in July."

You can see more from the dismal set below . . .


UPDATE I: September 16, 2005 10:54 am

Its the ultimate Hedonic adjustment:  Chart of the Day shows us graphically that without the items that are going up in price, there is hardly any inflation at all! 

Core_inflation



UPDATE II: September 17, 2005 11:54 am

The first official chart from the weekend WSJ:

Inflation


UPDATE III: September 24, 2005 2:54 pm

Here’s a round up of all our recent discussions on inflation

Sources:
Consumer Prices Climb 0.5%
Katrina Helps Propel Jobless Claims
To Highest Level in Nearly 10 Years
WALL STREET JOURNAL, September 15, 2005 5:44 p.m.
http://online.wsj.com/article/0,,SB112678676740241720,00.html

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