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Reported Record Price Drop in CPI is Extremely Misleading
EconomicsBriefing.com ^

Posted on 12/15/2005 7:15:45 AM PST by toaster

The Labor Department reported Thursday that its closely watched Consumer Price Index dropped by 0.6 percent last month, the biggest monthly decline since a 0.9 percent fall in July 1949.

Prices dropped for consumers in November, that is, unless they eat or sleep...

(Excerpt) Read more at economicsbriefing.com ...


TOPICS: Business/Economy; News/Current Events
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To: Blessed
The point is the large 1 month drop in energy prices gives the false impression prices aren't trending up at a rate we havent seen in this country for 15 years.

There is no false impression. Did you say there was a false impression when gas prices spiked?

21 posted on 12/15/2005 12:18:33 PM PST by Toddsterpatriot (The Federal Reserve did not kill JFK. Greenspan was not on the grassy knoll.)
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To: Toddsterpatriot

>There is no false impression. Did you say there was a false impression when gas prices spiked?<

No because gas price increases did not give a false impression of the direction of consumer prices.

A report that consumer prices fell .6% for the month is misleading without clarification. That is a annualized Deflation rate of 7.2%.An actual deflation rate this large would very likely signal a depression.

People on Free Republic often do not think through a report or can't think through it before they see a plot by the MSM.


22 posted on 12/15/2005 12:32:18 PM PST by Blessed
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To: jiggyboy

It is ironic that the press isn't trying to twist the numbers to hurt Bush today........they are doing the opposite.


23 posted on 12/15/2005 12:35:23 PM PST by rwfromkansas (http://www.xanga.com/rwfromkansas)
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To: Blessed
No because gas price increases did not give a false impression of the direction of consumer prices.

Wrong. Many on FR said we were doomed because oil was going to hit $100. Everything would get more expensive because shipping costs will rise.

A report that consumer prices fell .6% for the month is misleading without clarification.

What kind of clarification do you want? "One month does not a year make. Multiplying this months number by 12 may give you a false impression" LOL!!

People on Free Republic often do not think through a report or can't think through it before they see a plot by the MSM.

Agreed. And these are usually the people who see a plot when the government releases 2 CPI numbers, core (without food and energy) and regular old CPI (often in the same article). They know it's a plot because lately core was lower. Now that core is higher, they'll ignore it, or claim it is misleading. Can't win when the government is plotting against you, now can you?

24 posted on 12/15/2005 12:44:57 PM PST by Toddsterpatriot (The Federal Reserve did not kill JFK. Greenspan was not on the grassy knoll.)
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To: rwfromkansas

Quite so. I was waiting for the "but prices were actually up" disclaimer. Maybe they didn't bother because 0.2%*12 is still officially only 2.4% and they'd look like nit-pickers.


25 posted on 12/15/2005 2:28:53 PM PST by jiggyboy (Ten percent of poll respondents are either lying or insane)
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