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Following A One Month Break, PPI Resumes Climb, Rises 0.2% From -0.4% Previously, Biggest One Month Surge Since January; Core Rises 0.4%,

Tyler Durden's picture




 

Following a big drop in June energy prices, which pushed the broader PPI to a one year low sequential change of -0.4%, the PPI is once again in an uptrend, rising by 0.2% in July, higher than consensus of 0.1%. Core PPI was higher by 0.4%, following the 0.3% increase in June, and double consensus of 0.2%. Energy did drop modestly in July by 0.6%, but far less than the June 2.8% drop, and was more than offset by the rise in food Producer Prices of 0.6%. In terms of various stages of production, finished core goods rose due to a 2.8% hike in tobacco products, with light motor trucks and pharmaceutical preparations also contributed significantly to the rise in the finished core index; finished foods rose primarily due to a 2.7% rise in veal prices, while energy prices dropped due a 2.8% decline in gasoline. In intermediate goods, core was led by higher prices for plastic resins and materials, which rose 2.1 percent, energy was led by liquefied petroleum gas led this advance, increasing 2.5 percent, and foods saw a 6.3% increase in natural, processed, and imitation cheese. Crude energy benefited from a 5.2% decline in crude petroleum, crude foodstuffs actually dropped 0.8% in July, led by a 9.7% decline in prices for slaughter poultry led the monthly decrease in July. Lower prices for fresh and dry vegetables also contributed to the decline in the crude foods index. As for crude core, the biggest upward price mover was a 7.0% increase in prices for copper ores was a major contributor to the monthly increase in July.

Source: BLS

 

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Wed, 08/17/2011 - 08:43 | 1568408 Racer
Racer's picture

"imitation cheese"????????????

And what on earth is that???

Wed, 08/17/2011 - 08:45 | 1568415 Irish66
Irish66's picture

velvetta

Wed, 08/17/2011 - 08:47 | 1568419 narapoiddyslexia
narapoiddyslexia's picture

Styrofoam, painted yellow. Or, maybe, a yellow iPad?

Wed, 08/17/2011 - 08:52 | 1568440 FEDbuster
FEDbuster's picture

"A 2.7% rise in VEAL prices" , really???  The price of fucking veal can influence government statistics?  Didn't soy sauce price drops balance this out, WTF??  Has The Onion taken over the reporting of govt. stats?  If the price of veal is significant, then so is the price of 7.62 x 39.

Wed, 08/17/2011 - 08:57 | 1568461 EvlTheCat
EvlTheCat's picture

LOL

+7.62x39

Wed, 08/17/2011 - 09:21 | 1568570 Bicycle Repairman
Bicycle Repairman's picture

plastic cheese made in China. 

Wed, 08/17/2011 - 10:36 | 1568776 jus_lite_reading
jus_lite_reading's picture

Well its been confirmed that they make plastic RICE so plastic cheese seems truthful...

Wed, 08/17/2011 - 08:49 | 1568431 pazmaker
pazmaker's picture

vegatable oil made into a solid with nasty chemical flavorings

Wed, 08/17/2011 - 09:06 | 1568493 duo
duo's picture

Remember, the only inflation that counts is wages and key food ingredients:

HFCS

Textured vegetable protien (from GM soy)

MSG (makes imitation cheeze taste better)

Salt (ditto)

Partially hydrogenized soybean/corn oil

Wed, 08/17/2011 - 09:41 | 1568643 Instant Wealth
Instant Wealth's picture

Hell ! Why not make imitation cheese from imitation vegetable oil ?

Wed, 08/17/2011 - 12:42 | 1569247 RockyRacoon
RockyRacoon's picture

I'm working on marketing for instant water.   All suggestions are welcome.

Wed, 08/17/2011 - 08:55 | 1568448 John Law Lives
John Law Lives's picture

Those styrofoam wedges you see mounted on the heads of fans of the Green Bay Packers.

Wed, 08/17/2011 - 09:51 | 1568675 HardwoodAg
HardwoodAg's picture

The stuff that Kraft uses in their Mac and Wheeze

Wed, 08/17/2011 - 08:43 | 1568409 HelluvaEngineer
HelluvaEngineer's picture

bullish!

Wed, 08/17/2011 - 08:46 | 1568418 RunningMan
RunningMan's picture

Inflation. And the government still spending money to prop up the things that aren't getting more expensive, apparently CHICKENS.

http://money.cnn.com/2011/08/16/news/economy/chicken_prices/index.htm?iid=HP_LN

Wed, 08/17/2011 - 08:50 | 1568434 SheepDog-One
SheepDog-One's picture

Well, I can assure you chicken FEED is getting more expensive by almost 50% YOY and I have the receipts to prove it. Last July 50 lb of cracked corn cost $9, this July $15.

Wed, 08/17/2011 - 08:51 | 1568438 Caviar Emptor
Caviar Emptor's picture

Hence the big reported rise in meats

Wed, 08/17/2011 - 08:54 | 1568445 HelluvaEngineer
HelluvaEngineer's picture

Yup.  Last year we gave the deer a tasty treat.  This year they are on their own.

Wed, 08/17/2011 - 09:53 | 1568682 Chump
Chump's picture

And next year if you aren't able to bag several you'll be facing starvation absent other supplies.  Progress.

Wed, 08/17/2011 - 10:55 | 1568823 glenlloyd
glenlloyd's picture

And next year the deer will be your tasty treat.

Wed, 08/17/2011 - 08:47 | 1568423 firstdivision
firstdivision's picture

With a current PPI core rate at 5% annualized, will the Fed start tightening?

Wed, 08/17/2011 - 08:48 | 1568425 Caviar Emptor
Caviar Emptor's picture

Biflation. Once again. 

Wed, 08/17/2011 - 08:48 | 1568427 eurusdog
eurusdog's picture

Futures are up 45 min before the open! I hated Crammer in the afternoon and now he pisses allover the morning news too!

Wed, 08/17/2011 - 08:57 | 1568458 FEDbuster
FEDbuster's picture

CNBS has become unwatchable.  Mark Haines RIP.  Rick Santelli move to Bloomberg or Fox.

Wed, 08/17/2011 - 08:59 | 1568467 anynonmous
anynonmous's picture

"has become"

how about

has been always was

Wed, 08/17/2011 - 09:00 | 1568469 lizzy36
lizzy36's picture

He is an absolute horror.

Worst guy on CNBC and the benchmark for that particular prize is high. MCC's is a close second. Mostly want to punch her.

Nails.on.a.chalkboard.

Wed, 08/17/2011 - 14:02 | 1569268 RockyRacoon
RockyRacoon's picture

Spot on, Liz.   She acts as if she were acting like she thinks a real hard-hitting news person would act.   I think I made the point that it's all an act -- and a bad caricature at that.   Still, she does have big...  never mind.

And that new guy, Brian, he's just Cramer-lite:  Rolled up sleeves, yelling louder than anyone else, shrill voice, talks gibberish.   Think they are grooming him for a replacement?

Wed, 08/17/2011 - 08:49 | 1568428 Caviar Emptor
Caviar Emptor's picture

Food prices up 0.6%. 

Wed, 08/17/2011 - 08:49 | 1568433 Caviar Emptor
Caviar Emptor's picture

QE3 now in doubt

Wed, 08/17/2011 - 08:54 | 1568443 maxmad
maxmad's picture

Yep no doubt no QE3 (at least not for stawks) now fo' sure!

Wed, 08/17/2011 - 08:54 | 1568444 SheepDog-One
SheepDog-One's picture

The only one talking about QE is the dork from GS, and his case for QE is a measely $300 billion which has already been priced in many times over since promise of QE to offset all bad news since January and sub DOW 10,000. 

Im watching this clownshow from the sidelines.

Wed, 08/17/2011 - 08:57 | 1568457 Caviar Emptor
Caviar Emptor's picture

In that case we got a whole lot of re-pricing to do 

Wed, 08/17/2011 - 10:24 | 1568752 Smiddywesson
Smiddywesson's picture

I am out of stocks too.  With the gold trade such a no brainer, why play in front of Ben's steamroller? (Unless one is a day trader, they must be very pleased with the Bernank).

Wed, 08/17/2011 - 12:50 | 1569283 RockyRacoon
RockyRacoon's picture

...gold trade...

Are you trading or buying?   They are night-n-day you know.   Thanks in advance for your clarification.

Wed, 08/17/2011 - 08:50 | 1568435 MoneyWise
MoneyWise's picture

"2.8% hike in tobacco products"

I'm no smoker, but If I was one, I'd sue US.Gov for
violating human rights.. Common 15 years ago Pack of Marlboro
cost $0.99 at the gas station and now what? $15? in NY state?
Talking about GOLD? Tobacco is the GOLD nowadays, for those
.gov maniacs.
How they are always broke, no matter how much they collect
on tolls and cigarets? Always broke.

Wed, 08/17/2011 - 10:05 | 1568710 MachoMan
MachoMan's picture

Yet another similarity to prison...

Wed, 08/17/2011 - 13:23 | 1569430 boiltherich
boiltherich's picture

When I was in the service in 76 we bought Marb's for 11 cents a pack $1.10 a carton, now I pay $49.99 for an Apx. 5,000% increase.  Meanwhile my income in the same period has doubled. 

Wed, 08/17/2011 - 08:52 | 1568441 machineh
machineh's picture

PPI report -- Your zero-percent-till-2013 Federal Reserve inflato-dollars at work!

Perry is quite wrong about charging Bernanke with treason. The appropriate and provable charge is racketeering.

Wed, 08/17/2011 - 09:26 | 1568588 baby_BLYTHE
baby_BLYTHE's picture

Quite treasonist to bailout foreign banks to the tune of some 16 trillion dollars while average Amreicans were losing their jobs and being thrown out of their homes, IMO.

Wed, 08/17/2011 - 08:53 | 1568442 Caviar Emptor
Caviar Emptor's picture

YoY: Core PPI up 2.5%. PPI overal up 7.2%. Nosebleed in a down economy. 

Wed, 08/17/2011 - 09:00 | 1568470 SheepDog-One
SheepDog-One's picture

And since the economy is confirmed totaly screwed by any measure, lets power up the robots and bid everything up more!

Hell robots got nothing else better to do, and who knows what kind of mischief they could get into if left idle.

Come on Ben, you can do it just 1 down day! Just for old times sake. What are you really scared of?

Wed, 08/17/2011 - 09:06 | 1568492 Caviar Emptor
Caviar Emptor's picture

True, Sheep. The Bots don't need food. To them, everything is bullish. But without their QE3 wet dream, TPTB gonna throw a tantrum. 

Wed, 08/17/2011 - 09:11 | 1568523 SheepDog-One
SheepDog-One's picture

I look at all this, and keep concluding theyre just delaying, marking off time till some big event happens. None of this in itself is a plan, its just delay tactics.

Wed, 08/17/2011 - 09:30 | 1568599 Oh regional Indian
Oh regional Indian's picture

Agree SD1, the players/enraged bull is/are ready to burst from behind the gates, mauling, goring....etc. Clearly this delay is to allow more pressure to build, or some crazy, esoteric alignment is being awaited. Whatever it is, it's going to be huge!

ORI

Wed, 08/17/2011 - 10:31 | 1568765 Smiddywesson
Smiddywesson's picture

That is my observation.  The only reason they would throw  around these sums in a hopeless cause is they are just buying time.

However, there is one thing they are doing that doesn't buy them time, so logically, it has to be part of their long term planning.

They are buying gold.  Gold is the answer, and anyone without it is betting on the old system, a system the insiders apparently don't have any faith in anymore.

Wed, 08/17/2011 - 10:20 | 1568745 Yardstick of Ci...
Yardstick of Civilization's picture

Let's just hope the bots burst the price of food bubble soon.  I can hardly afford caviar, lamb chops, and lobster at the moment.

Wed, 08/17/2011 - 08:55 | 1568450 maxmad
maxmad's picture

Tyler, can you plz make the comparison between Bernanke and KGB from the movie Rounders... I still think KGB was Bernanke

Wed, 08/17/2011 - 08:56 | 1568451 Caviar Emptor
Caviar Emptor's picture

Tweet from Nouriel Roubini: 

Hyperinflation! So much for hysterical claims that Fed policy & QEs will cause massive inflation ": PPI up 0.2%, exp. 0.1%"

Wed, 08/17/2011 - 09:02 | 1568477 Tyler Durden
Tyler Durden's picture

And Zerohedge response:

Or claims that gold as an inflation hedge will tumble...

Wed, 08/17/2011 - 09:06 | 1568484 SheepDog-One
SheepDog-One's picture

Roubini's first blatant mistake is actually believing these less-than margin of error 'official Gubmint numbers'? 

Yea Roubini, we're all just 'hysterical' thats all. Lets see what your opinion would be if you were part of the 25% unemployed, and not some FED butt-boy as you now apparently are.

Wed, 08/17/2011 - 09:09 | 1568505 anynonmous
anynonmous's picture

and Roubini's reincarnation of RGEmonitor

http://www.economonitor.com/nouriel/2011/08/15/is-capitalism-doomed/

but he turned off comments on this particular post to drive traffic to project syndicate

why?

Twitter

Nouriel Roubini

I am #2 in the Most Read list on Project Syndicate ": POPULAR: "Is Doomed?" by Roubini. "  

The guy has an ego the size of his new penthouse (I wonder if Larry Summers is back on Roubini's payroll / visa versa)

Wed, 08/17/2011 - 09:13 | 1568531 SheepDog-One
SheepDog-One's picture

I guess snuggling up to the FED/administration must provide good paychecks.

Wed, 08/17/2011 - 09:15 | 1568541 anynonmous
anynonmous's picture

I hear his new place doesn't have walls decorated with Vaginas like his old one

Perhaps Tyler could provide some insights

 

http://nymag.com/daily/intel/2008/10/economist_nouriel_roubini_has.html

Wed, 08/17/2011 - 10:04 | 1568707 old naughty
old naughty's picture

most likely both are on the payroll of one master.

Thanks for sharing.

Wed, 08/17/2011 - 09:08 | 1568511 Caviar Emptor
Caviar Emptor's picture

Roubini's new slogan: Not as gloomy or doomy as you think! 

Wed, 08/17/2011 - 09:00 | 1568471 John Law Lives
John Law Lives's picture

From the AP news release:

http://finance.yahoo.com/news/July-core-producer-prices-rb-481603091.htm...

 

"A spike in food and energy prices pushed up inflation early this year, but weak economic growth and high unemployment kept underlying price pressures contained."

It takes a great deal of creativity to put a positive spin on anemic economic growth and high unemployment.

Wed, 08/17/2011 - 09:05 | 1568486 SheepDog-One
SheepDog-One's picture

Things are so bad that its actually good news.

Wed, 08/17/2011 - 09:13 | 1568529 Caviar Emptor
Caviar Emptor's picture

That, in a nutshell, is biflation nation. Been sayin' it. 

Wed, 08/17/2011 - 10:12 | 1568726 MachoMan
MachoMan's picture

What is the mechanism that takes us from stagnant wages, increases to our cost of living, and decreasing prices for debt laden assets?  While it's easy to describe the present, I can't fathom that this phenomenon is anything other than transitory...  which way will it break?  (aside from the fact that bi-flation is technically impossible given the binary nature of money supply changes).

Wed, 08/17/2011 - 09:01 | 1568476 Caviar Emptor
Caviar Emptor's picture

The ecstasy of a free money orgy casino is now followed by the agony of higher prices and bills to pay

 

Wed, 08/17/2011 - 09:03 | 1568481 Oh regional Indian
Oh regional Indian's picture

Meanwhile, the BDI is climbing again. Look at Crude though. From near 120 to late 80's is a huge move, impacts everywhere.

How much gold rise is the anti-oil move?

PPI? Hahhhhhhhha!

Humph! NUMBers!

ORI

http://aadivaahan.wordpress.com/2011/08/16/pre-cursor-2-and-currents/

Wed, 08/17/2011 - 09:12 | 1568527 Caviar Emptor
Caviar Emptor's picture

Yes and some (Mr Roubini) expect a China double dip. Ha. 

Wed, 08/17/2011 - 09:18 | 1568558 SheepDog-One
SheepDog-One's picture

Yea ORI but isnt it funny all these who tell us all about prices are the ones who obviously NEVER would stoop to go to a grocery store alongside peasants themselves? Makes me laugh to hear billionaires discussing 0.01% fluctuations food prices, when you know they have a hired chef preparing their coq au vin dinner.

Anyone who actually has to go to the store to buy their own food knows its fuked.

Wed, 08/17/2011 - 09:31 | 1568604 Oh regional Indian
Oh regional Indian's picture

Hah! I remember some of these clowns beign asked such simple questions as the price of milk at the check out counter and them stumbling/fumbling.

Why does democracy and all it's associated workings look more and more like monarchies gone horribly wrong?

ORI

Wed, 08/17/2011 - 11:59 | 1569073 tip e. canoe
tip e. canoe's picture

maybe because we still haven't found a cure for this virus?

http://en.wikipedia.org/wiki/Divine_right_of_kings

Wed, 08/17/2011 - 12:13 | 1569143 Mad Cow
Mad Cow's picture

All economic systems that have been tried end the same way. Small percentage at the top, controlling the masses at the bottom, until a revolt. Then the next set of kooks gain control. Rinse and repeat.

It's like anything assembled from the elements, eventually it returns from whence it came, dust. It's the nature of the physical dimension (meat grinder), ie flawed. Hedge accordingly.

Wed, 08/17/2011 - 09:03 | 1568482 AngryGerman
AngryGerman's picture

qe3 will come, and then superinflation! fuck roubini!

Wed, 08/17/2011 - 09:16 | 1568544 baby_BLYTHE
Wed, 08/17/2011 - 11:50 | 1569032 trav7777
trav7777's picture

I have artwork by dees nutz

Wed, 08/17/2011 - 09:17 | 1568548 Caviar Emptor
Caviar Emptor's picture

And in a further tweet, Nouriel reveals his theory: 

As in 2008-09 once we double dip we will get Stag-Deflation (Recession + Deflation) rather than Stagflation. There is no inflation in sight

Wed, 08/17/2011 - 09:21 | 1568571 SheepDog-One
SheepDog-One's picture

Well Roubini may stagger into the truth a bit, that being a whole lot of people simply CANT pay higher prices, therefore inflation cant really take off. Which then means companies are taking the hit somewhere else. And certainly 'consumers' are taking the hit another way thru smaller filled packages and way crappier quality. Have you bought steaks lately? Its ridiculous poor quality.

Wed, 08/17/2011 - 09:28 | 1568593 Caviar Emptor
Caviar Emptor's picture

Yup. Just a moderate amount of both inflation and deflation in just the right places is just as killer as a huge dose of either. Worse from the point of view of central banks because they have no tools to deal with it, let alone experience or knowledge. THey're only just barely groking to it now

Wed, 08/17/2011 - 09:23 | 1568576 SheepDog-One
SheepDog-One's picture

But on further review, Roubini is obviously far too simplistic. He leaves out things like tires, and the huge rise in price theyve seen. 'Theres no inflation in sight'? Just shows how out of touch these Ivory Tower types really are.

Wed, 08/17/2011 - 09:28 | 1568594 Caviar Emptor
Caviar Emptor's picture

You're seein' it, bro. You and me. 

Wed, 08/17/2011 - 09:26 | 1568587 FoieGras
FoieGras's picture

Bonds rallying worldwide. Bunds up, 10y turning around. Gilts up BIG.  Swiss 10y rallying to new highs.

Anybody seriously think PPI is saying anything about inflation? Look at bonds, folks. Just look at the action!

Wed, 08/17/2011 - 09:38 | 1568628 dcb
dcb's picture

how to tell market are rigged.

inflation is up, yet long term tlt, opens higher today instead of down. Why does our government work so hard to make sure our markets are not free or fair.

Wed, 08/17/2011 - 13:29 | 1569442 boiltherich
boiltherich's picture

Import/export prices yesterday were also a shock:

 

Export Prices - M/M change 0.1 %    

-0.4 %

 

Export Prices - Y/Y change 9.9 %    

9.8 %

 

Import Prices - M/M change -0.5 % -0.1 % -0.8 % to 0.5 %

0.3 %

 

Import Prices - Y/Y change 13.6 %    

14.0 %

 

 

Avocados up 338% in two months at Slaveway, bummer. 

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