CPI Drops 0.3%, Largest Decline Since December 2008

Tyler Durden's picture

If yesterday's better than expected initial claims numbers were bad for the market (as they implied the approach of the Fed's QEnd), today's CPI should dissolve some fears of an imminent, and very unrealistic, end to easing. Because as the Fed explained, employment is only one component of the QEnd calculus, inflation is another. And with November CPI dropping 0.3% sequentially (up 1.8% Y/Y), on expectations of a -0.2% M/M, and +1.9 Y/Y, also the biggest sequential decline since 2008, there is not much to worry about on the inflation front... as long as one doesn't count other inflation "expressions" such as modern art, insurance costs, student tuition, or even the S&P and other credit funded items into account. Core CPI also missed the expected rise of 0.2%, growing at 0.1%. Biggest components of the price drop were energy prices, declining (-4.1%) from October, Apparel (-0.6%) and Used cars and trucks (-0.5%) - thank you GM channel stuffing. Alternatively, prices rose for food at home (+0.3%), Electricity (+0.7%) and food away from home (+0.3%). We may need some more QE4EVA+1^? soon if this continues.


Chart: Bloomberg

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GetZeeGold's picture



Only four more years for the nightmare to end........buck up campers. Our parole draws neigh.

El's picture

Do you really think so? Assuming in four years some knight comes riding in on a charger to save us by changing direction, you could be right. I'm not so optimistic, but I sure do like positive people. +1 for attitude. ;)

GetZeeGold's picture



Well......it's either that or lay down and die.


economics9698's picture

Obama will be president for life, Hugo Chavez style, or Hillary will get the blessing of the Yids.

Pray for revolution.

SheepDog-One's picture

A few months ago we 'only had 1 month left', because remember 'it was all pumping for the election', now that it's over we have 4 more years to pump?  

GetZeeGold's picture



If you've got their playbook......it shouldn't be too hard to pull off the win.

ejmoosa's picture

In four years, college graduates 32 and under will never have been in a healthy economy.  This IS the new norm.

buzzsaw99's picture

sorry zee, this depression will only get worse and it will NEVER end

economics9698's picture

When China undercuts the dollar and the fiat dies so does the ZOG.


johnQpublic's picture

electricity up 12% here...delawho, bidens home state

LawsofPhysics's picture

Yes, take a look at water and sewage as well.

The underlying debt and energy problems continue to be ignored.

Longing for the old America's picture

Property and sales taxes shooting up rapidly while unaccounted for in the official CPI. Health insurance going wild to the upside too.

Oh, and don't forget the fast rising state income tax rates and the coming jump in cap-gains and dividend confiscations.

Lies, lies, lies from the BLS.

akak's picture


Tyler, why are you even posting this bullshit?  We get enough official propaganda from the corporate-controlled media already.  Please do not even post such crap in the future, and give ANY credence to these wildly, insultingly and laughingly manipulated and lowball figures from the Bureau of Lying Statistics.

LawsofPhysics's picture

Right, if you leave out food, fuel, and healthcare.  Guess what schumcks, when the comsumer is tapped out on these essential items there isn't anything left fo icrap.  No surprise "prices" are coming down.  In a word, "bidless".

goldfish1's picture

Infinity and beyond, bitchez.

ShorTed's picture


I have it on good authority ('cause President Obama said so) that healthcare costs won't go up if we got onboard with ObamaCare.  So forgive me for disagreeing with you, ya know, becasue the President wouldn't lie to us.  


pinqy's picture

They are all included. Do you not know how to read a report, or even the article you're replying to????

LawsofPhysics's picture

My healthcare is up 15%, food and fuel are both running around 8%, electric bill at home up 6%, must simply be my "lying eyes".  The report is very much weighted towards consumer purchases in terms of the sampling.  Statistics are great for "showing" whatever you want to.  Go look at the MIT prices project for a better read on real prices.  Go look at corn and various grains being sold on the open market.  Go ahead put up a chart of those prices paid over the last year.  They sure as hell are not flat.  Moreover, insurance and local taxes are not reflected.  Please, pull your head out of your ass.

Bay of Pigs's picture

Lots of US doelarr and deflation bulls that populate fianace boards love to point to the CPI data and never factor in real world prices in their bullshit ecocomic theories.

I used to bust Mish's balls on this topic every month. He only questioned the stats that didnt fit his model. 


DUNTHAT's picture

I think inflation is understated by the difference between "real GDP growth=2.7 %" and the true growth number ( both PMI and Chi Fed Index flat at ZERO, meaning of course, real inflation is at 2% PLUS 2.7 % or around 4.7 % .

FreeMktFisherMN's picture

Inflation is rampant and will show up in prices even more than it has been. 

magpie's picture

The inflation will show up as massive tax hikes in the future

LawsofPhysics's picture

Riiiiiigggggghhhhhttt.  Look to Greece for the precisely how this is dealt with.  Just spoke with my accountant yesterday on how to arrange the books so it appears we are just making ends meet.  Unfortunately, it was easier than I thought.  In fact we may be in the red next year (depending on what diesel does).  Guess I'll have to fire the accoutant.   The point being; go long black markets, because suddenly everybody will be "poor".

magpie's picture

I know you are being sarcastic LoP, but that was one of the ways how beginning hyperinflation was also dealt with temporarily in the past - perhaps in this case however the "austerity" primarily serves other purposes and this effect is i honestly believe an unintended consequence for the central planners.

Funny that today i had the idea to even write a book on the "black market", the hero of the next decade...

LawsofPhysics's picture

Sarcastic?  Sort of.  If you really don't think folks make serious efforts to hide their wealth or net worth, you really haven't been paying attention and probably pay way more taxes then you have to.  So long as I will be rewarded for investing in my own employees and business I won't complain too much, but take that away or make it impossible to deal with the increasing input costs (margins fucking matter) and it's game over.  People need to eat, I'd be happy to go off grid and start a sharecropping operation.

magpie's picture

It isn't really that hard, like in Greece pay your taxes or we shut down your utilities, and if you are off the grid, we start levying more tolls.

That sort of thing, the market starts fragmenting by itself nonwithstanding the rhetoric of globalization and free trade.

LawsofPhysics's picture

Riiiiiiggggghhhht, because thing sort of approach has worked out so well for Greece.  LMFAO!!!!  I'd say Americans are potentially a bit better armed as well.  We have some solar and wind capabilities, many cisterns and wells.  Go ahead, please try and come onto the property attempt to shut anything down.  I know the commissioners and sheriffs very well.  They all like to eat, and really don't care too much for the Feds.  You are dead on as far as the fragmentation goes.  All economies are really local at the end of the day.  Everyone needs to look around and assess their neighbors and the available resources.  Nice work magpie, get your tribe in order.

slackrabbit's picture


What’s the bet xmas figures will also suck....until after revision, where we leave out retail, toys, socks and iPads...then its a success!


Glass Seagull's picture

Must be all the expensive beef, grain, healthcare, education, and improving housing prices helping with this "drop."

What a joke.

disabledvet's picture

Still trying to make sense of falling energy prices as on the hand great for the economy on the other the end of the economy as we know it.

LawsofPhysics's picture

Don't think about energy in terms of the price at the delivery point.  Think about how much it will cost (in terms of capital, energy, and resources) to build the next powerplant or tap the next well or extract the next ton of coal in order to grow (required by the current economic ponzi) or even keep things the way they are.  The reason nothing makes sense is due to a major decoupling and shift in capital flows around the world.  My hypothesis is that this is due in large part to many western countries failing to treat capital, talent, and resources with respect (hence it goes elsewhere) and failing to address the underlying structural problems.  Same thing happened to the Soviet Union in the 80's.  America's collapse will follow a similar path.

SheepDog-One's picture

.01%...whoa thats HUGE! Too bad girls are not so easily impressed.

hugovanderbubble's picture

I like the deflation napalm power blast

tooriskytoinvest's picture

We Are Witnessing The Death Of Small Business In America


I think the business onwers gave up so called the hope and change...

LawsofPhysics's picture

Margins matter!!!!!  If you can't adjust in order to deal with rising input costs, you fold or get "creative".  Long black markets.

ekm's picture

There is only one component of Fed's decisions and only one:


Order from White House.

SheepDog-One's picture

FED global central bank takes its orders from the White House? No, the FED is the real 'prezdent'.

Tuco Benedicto Pacifico Juan Maria Ramirez's picture

There is only one component of Fed's decisions and only one:



hugovanderbubble's picture


VIX at lows


Volume = Limbo Trading across the world

Market quoting 15% premium vs nav

Watching in Baltimore's picture

In Baltimore MD everything is up and even while gas prices have eased they are still very high for many even for those of us lucky enough to have a job.  It is very had to believe any of these reports.  

hugovanderbubble's picture

Sell and short Equities for a beautiful EOY Selloff

hugovanderbubble's picture

Sell and short Equities for a beautiful EOY Selloff

ZFiNX's picture

Just the inflation arrow being drawn in the bow.

Tuco Benedicto Pacifico Juan Maria Ramirez's picture

Yes!  I have complete and total confidence in all establishment statistics!  Ha. Ha!


SheepDog-One's picture

Yea in particular when its a 'massive' .3% number....I look at that chart and see nothing but line noise for years while real world prices have at least doubled.

SilverMoneyBags's picture

Even Bernnake said on Wednesday that current CPI calculations were a joke.

phoolish's picture

Why is my latest insurance bill 10% higher?

SheepDog-One's picture

Well, so far it appears no one is impressed, not even algobots.