[expat_panama]

We're hearing the demographics/lifestyle reasons for both inflation and labor force numbers but imho they can't explain why the change occurred all of a sudden in the last few months of 08. Like, population ages change a little from near to year and not a lot from week to week. What I'm seeing is that while the fed crates money the people just aren't spending it, and the lack of buying pressure is why prices aren't going up. Check out money velocity w/ cpi:
 

[Sequoyah101]

That all makes sense and that you mention it, old people are being replaced by something / someone who should buy stuff. Bottom line is people are not buying stuff because they are not able. People without work don’t buy much. Any other reason people don’t buy much?

Too few dollars chasing too many goods. Many years ago that is how my Dad explained the Great Depression. Not there now but could be.

Like so many things, the answer from the FRED is in plain sight.