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US Producer Prices Tumble Most Since 2009 (And It Wasn't All Energy-Related)
The drop in the price of energy will be initially blamed for the 0.8% MoM drop in Producer Prices Final Demand (far more than 0.4% drop expected) and the most on record. However, ex-food-and-energy, PPI also fell 0.1% (missing expectations of a 0.1% rise) and ex-food-and-energy-and-trade-services, PPI fell 0.3% - so it's not just the energy price drop (even though fuels and lubricants dropped 9.3% MoM). In fact the biggest MoM drop was in furnishings, computer hardware, and TV, video, and photo equipment.
PPI Final Demand saw its biggest MoM drop on record...
Perhaps just as problematic for The Fed... YoY PPI is unchanged - its worst level on record...
PPI Ex-food-and-energy also dropped - missing expectations of a 0.1% rise...
And while it will come as no surprise to anyone that final demand for goods cratered as a result of the tumble in crude prices which now appears to have reversed, it was a surprising drop of -0.2% in Final Demand Services that some may have a problem explaining:
Final demand services: The index for final demand services decreased 0.2 percent in January, the first
decline since falling 0.3 percent in September 2014. In January, prices for final demand services less trade,
transportation, and warehousing moved down 0.4 percent, and the index for final demand transportation and
warehousing services dropped 0.8 percent. In contrast, margins for final demand trade services advanced 0.5
percent. (Trade indexes measure changes in margins received by wholesalers and retailers.)
Product detail: In January, a major contributor to the decline in the index for final demand services was
prices for outpatient care (partial), which fell 0.7 percent. The indexes for automotive fuels and lubricants
retailing; securities brokerage, dealing, investment advice, and related services; television, video, and
photographic equipment and supplies retailing; mining services; and truck transportation of freight also
decreased. Conversely, margins for apparel, jewelry, footwear, and accessories retailing advanced 3.6
percent. The indexes for machinery, equipment, parts, and supplies wholesaling and for loan services
(partial) also increased.
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i remember saying when they stopped monthly bond buying to expect EVERY econ Indicator to be terrible to keep QE4 alive....voila'
I swear Rick Santelli was told he would be fired from CNBC if he stayed as skeptical as he was before. Now he seems brainwashed like every other idiot on the tele.
Pogue Colonel: Whose side are you on, son?
Private Joker: Our side, sir.
Pogue Colonel: Don't you love your country?
Private Joker: Yes, sir.
Pogue Colonel: Then how about getting with the program? Why don't you jump on the team and come on in for the big win?
Private Joker: Yes, sir.
You can't eat fuel and lubricants (or iPads)!!!
29.5 hr/wk jobs and Obamacare premiums........it's pretty much a killer.
Just part of the plan. At least 'the plan' is meeting or exceeding expectations, it seems.
it's about the duality of man..its a Jungian thing sir.
Got to keep the wheels turning one way or another. Even if those wheels pulp the plebians as they mow them down.
I agree. I, too had wondered how long he could tell the truth before being told to get with the narrative.
Bullish!
Behold the stealth great depression 2.0
For every action..there is a reaction....have Iphones dropped in price???
Appears everything is on the right track, or better than expected. Next stop awesome-ville...All aboard! High 5!
Fact: You can only juggle so many chainsaws before you cut off an arm.
.......and now we are finally seeing the effect of that masked deflation, grab the popcorn.
Just greasing the skids for QEwhatever to be wheeled in.
How much iCrap can you have?
Don't worry, the lamestream media will proclaim it's all due to "brutal winter weather". Then this spring, it will be "extreme spring storms". Then this summer it will be "extreme summer heat due to global warming". Then this fall it will be "extreme hurricanes". All just in time for another "brutal winter". Because extreme weather has never happened before 2012.