Posted on 03/05/2015 8:11:17 AM PST by Diana in Wisconsin
The BLS put out their monthly CPI lie last week. They issued the proclamation that inflation is dead. Did you know your costs are 0.1% lower than they were one year ago. They then used these deflation numbers to proclaim your real wages soared last month. It’s all good. The American consumer is so flush with cash, they decided to spend less money for the second month in a row. The Wall Street shysters are so happy with declining consumer spending, declining corporate profits, and a global recession, they pushed the NASDAQ up to 5,000 for the first time in 15 years. Hey!!! That was the year 2000. Things really got better after that milestone.
“I’ve noticed that we have to watch our budget more closely than ever.”
Oh, you betcha. My gal-pals and I have monthly ‘challenges’ to see where we can cut more out of our budgets, share coupons, grocery sale info, have made shopping at Thrift Stores the norm, budge recipes, etc. I am SO grateful I no longer have 3 teen boys to feed! Just me, the dog and usually two meals a week wit Beau. I mean, he ‘courts’ me with beef and pork from his butchered critters, or venison - he’s not freeloading, LOL! I sure miss having laying hens. Hurry, Spring!
I still have a little wiggle room, but every extra DIME for the past 5 years has gone to my farm mortgage principle. It’ll pay off in the long run. I’m not QUITE down to Ramen Noodles 5x a week - but I’ll be there in the next two years or so. Luckily, I LIKE Beans and Rice! :)
I’m not convinced that the next President can even make a dent in this mess. Seriously. Who would want to take this on? It’s maddening!
I have the impression that way too many folks have bought into to “inflation” scenario, the buy gold etc scenario without consideration of much much bigger factors.
How’s that Gold working out for you?
Virtually every major economy around the world and their central bankers are desperately trying to stop this “deflationary” cycle with the only tool that they have. Lower rates and some form of QE. QE is basically printing money, and while that is without a doubt inflationary and is exactly what these Central Bankers want. The only tool they have to fight deflation is to try and create inflation.
If you consider that the efforts have had the intended effect on some sectors (CPI), and has still been unable to generate the type of capital flows needed in new investments to generate any real economic growth then we are in deep deep trouble.
I’ve posted this many times before, but it’s worth repeating.
Deflation is a Bitch.
It’s like an endless stream of zombies that suck the life from whatever life still exists and you are (the FEDS) and have run out of ammunition, but the zombies still keep coming.
The only thing that can stop this is a REAL technological Breakthrough.
If and when it happens, the money will flood into that technology and all its constituents so fast that it will make your head spin.
If people took a closer look at the economic expansions that have occurred in the western world, they would see a series of “Bubbles”.
Technological breakthrough followed by a flood of money and its over investment followed by recession while the original breakthrough becomes a part of everyday life.
How many PC makers existed in 1987 vs the number today?
How many auto manufacturers existed in the 1920s vs today?
The world is flooded with cash and apparently it’s more concerned with its return OF investment vs. its return ON investment.
There is a reason for this.
I prefer the Dave Ramsey approach. Pay off a 4% mortgage, and you have a guaranteed 4% rate of return on your money plus lowered monthly overhead rates from there on out.
Good work on your part.
Surging food cost was one of the things that made Obama’s re-election so amazing...along with $4 gas, 13% unemployment, trillion dollar deficits, and failed foreign policy.
Cash is King.
Give me some examples of deflation. Where are prices falling?
Other than gas I can’t.
It’s only a matter of time before it translates to virtually every commodity we rely on.
Pretty much every other aspect of deflation is reflected in the numbers.
Real Unemployment.
Average wages.
Corporate Profits.
Average work Week.
If you step back, you may realize that our current economy is built on a house of cards.
“For the zillionth time: isn’t deflation a good thing?”
It was hell for those suffering during the Great Depression.
Consumer electronics go down in price every year. That’s the only one I can think of.
They will how up on this thread. I haven't read replies yet but they will be here. maybe there will also be a snarky comment about John Williams.
The other side benefit of paying down and paying off debt - you have less that you need to pay long term when wages start to stall under deflation even as debt may grow.
The interesting paradox as that real goods are being inflated because of the race to the bottom through currency devaluation, while the means to pay for it is being crushed in a deflationary death grip for the average person. QE to infinity and beyond was great for the top of the economy because they have the means to take advantage of asset appreciation and zero percent debt for capital investment. It did not work out for anyone else. They need to pump money into the bottom of the economy if they want to save it. Once people get used to living on less, it also becomes a mental barrier to convince them it is safe to not curl into fetal position.
Inflation: A sustained increase in the general level of prices for goods and services.
Deflation: In economics, deflation is a decrease in the general price level of goods and services.
I'm using these definitions. Apparently you aren't. Why not?
Once again, can you give me some examples of "decreases in the general price level of goods and services"?
Where’s the ones with minus numbers in front of them? Maybe that’s on a different chart.
228 pages for you to sort through, right here! You had nothing else to do today, Right? ;)
http://www.bls.gov/cpi/cpid1501.pdf
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