Posted on 03/13/2025 8:26:21 AM PDT by Red Badger
Promises made, promises kept.
“When I win, I will immediately bring prices down, starting on Day One,” Donald Trump said on the campaign trail last summer.
Critics claimed, without evidence, that Trump’s tariff plans would raise inflation. Many economists argued that while the rate of price increases might slow, prices would not decline and Americans would simply have to adjust to the new higher price level.
In February, however, the core producer price index for final demand declined by 0.1 percent. In other words, prices of goods and services— excluding food and energy—sold by U.S. businesses came down.
The broader index for producer prices was flat for the month, indicating that there was no inflation at all in the month.
Both numbers were better than expected. Economists had forecast a 0.3 percent increase in the broad producer price index (PPI) and an even larger 0.5 percent increase in core producer prices.Instead of the expected price surge, we got price stability—and even declines in core producer prices.
The producer price index (PPI) is often mistakenly called a measure of wholesale prices, a confusion that goes back to its original name as the wholesale price index. In fact, the index has never been a measure of wholesale prices and the name was changed in 1978.
The PPI for final demand measures the prices that businesses in the U.S. receive for goods, services, and construction sold for personal consumption, capital investment, government purchases, and exports. It excludes export prices, since those are paid to foreign producers, and sales taxes, which are paid to the government.
(Excerpt) Read more at breitbart.com ...
All of this hinges on the national debt and the price of energy.
Apparently the economists who make these projections would disagree. They expected higher numbers, not flat.
It is pretty funny. I’m liking the investment setup though. We needed this breather, the market was out over its skis on valuation. Now stock prices look more reasonable. I will nibble on certain stocks I already hold on any more weakness. Looking forward, there are no signs of recession yet and the FED has ammo if unemployment goes up and/or business activity slows.
The Market has needed a reset for some time.................
Post 3. Wow your TDS cred is intact.
I wouldn’t bet any money on that yet. Lower inflation yes, especially after the temporary tariff negotiations get settled. The markets can deal with good news and bad news, their worst problem is uncertainty.
If unemployment were to start rising quickly we could get to deflation eventually, but no one will like it. Business activity doesn’t predict that at this time. It also looks like the “strike fever” wore off quickly for now.
“We had it during Reagan’s era and we can get through it again.”
“The highest inflation rate under President Ronald Reagan was 12.4% in 1980. After Reagan took office, the inflation rate dropped to 10.4% in 1981 and then averaged 4.4% for the rest of his two terms.
We are at 2.8%. We don’t need We just need the continuance of reasonable gas prices.
By the way, I made huge money (for the times) during Carter’s inflation. Real estate usually outruns inflation. I bought a tiny industrial lot for $700 and a house lot for $3,500 in 1980. Sold both in ‘83 for $21,700k total. Those were seed money for more investing and I was off and running on “other people’s money”.
“The highest inflation rate under President Ronald Reagan was 12.4% in 1980. After Reagan took office, the inflation rate dropped to 10.4% in 1981 and then averaged 4.4% for the rest of his two terms.”
The reason inflation dropped was not “Ronald Reagan”, it was the Federal Reserve under Paul Volker raised interest rates (with a prime rate reaching 20.5%) to squeeze out inflation, which also triggered a recession (1981-1982), with unemployment reaching 9.7% and GDP fell by 2%. BUT it was necessary medicine.
Wow, you don’t understand economics nor how much Presidents actions in 30-40 days do not in 30-40 days affect the economy. It has nothing to do with “TDS”. The ignorant are always giving Presidential actions too much credit and too much blame for immediate economic matters.
“Apparently the economists who make these projections would disagree.”
Correction; SOME economists. Others agree entirely.
Yes, you are correct, as are the stats I presented.
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