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Supposed Deflation In October Blows Door For QE3 Wide Open

Tyler Durden's picture




 

The decoupling theme for dummies continues to be alive and well. Following yesterday's simply ridiculous economic data, today we learn that in October live got cheaper as broad inflation as determined by the CPI declined for the first time since Jun, printing at -0.1 on expectations of an unchanged reading, and down from 0.3% in September. The bulk of this drop was on the decline (?) in energy prices: ex food and energy CPI was up 0.1%. Well, with the WTI back to $100 in anticipation precisely of the QE3 loophole this report is supposed to open, we can promptly remove that "deflation" notion. Still, Fed hawks can stand down "looks like we passed a cyclical peak" says Bloomberg analyst TJ Marta. In the meantime, Year over Year inflation increased by 3.5%, or about 35% if one actually counts the things people buy and removes the hedonic adjustments due to a carton of milk now assumed to have a rearview camera, power steering and ABS brakes (as per the BLS), and costing negative money in real terms or something.

From the BLS:

A decline in the energy index more than offset small increases in the indexes for food and all items less food and energy to create the all items decline. The energy index turned down in October after increasing in each of the three previous months as the gasoline and household energy  indexes declined after a series of seasonally adjusted increases. The food index rose in October, but posted its smallest increase of the year as the fruits and vegetables index declined sharply.

 

The index for all items less food and energy increased 0.1 percent in October; this was the same increase as last month and matches its smallest increase of the year. While the shelter and medical care indexes accelerated in October and the apparel index turned up, the indexes for new vehicles, used cars and trucks, airline fare, and recreation all declined.

 

The all items index has risen 3.5 percent over the last 12 months, a lower figure than last month’s 3.9 percent increase, as the 12-month change in the energy index fell from 19.3 to 14.2 percent. In contrast, the 12-month change for all items less food and energy edged up from 2.0 to 2.1 percent. The food index 12-month change was 4.7 percent, the same figure as in September.

 

 

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Wed, 11/16/2011 - 09:42 | 1882178 AngryGerman
AngryGerman's picture

it's all getting cheaper bc there are less people that can afford to buy shit...

Wed, 11/16/2011 - 09:51 | 1882231 Da55id
Da55id's picture

currency inflation but number of units purchased deflating

Wed, 11/16/2011 - 10:19 | 1882340 Comay Mierda
Comay Mierda's picture

seriously who believes this shit anymore? fact = consumer spending higher, consumer confidence lower. why? because the price of everything not included in the bullshit CPI (dont get me started on hedonics) is going UP, like food, and consumers are forced to spend more money on the shit and they're pissed about it.

this bullshit CPI makes GDP overstated too.  realworld CPI at almost 12% and realworld GDP has been contracting since 2007.  but what the fuck do i know?  the phd economists at the fed and the BLS have it all figured out

Wed, 11/16/2011 - 11:45 | 1882739 mick_richfield
mick_richfield's picture

Nobody who pays the least bit of attention believes it anymore.

Just before the end, the servants of the Perversion are only talking to each other.

 

Wed, 11/16/2011 - 16:47 | 1884016 akak
akak's picture

"Supposed deflation" was the key phrase in the headline here.

Deflation has NEVER occurred under a fiat monetary regime, and anyone waiting to see it under our own might better spend their time searching for the edge of the flat earth.  Governments throughout history have always, ALWAYS resorted to the same tactic when confronted by insurmountable debt: depreciate the currency.  It is absurd and idiotic to expect to see a fiat currency RISING in value as the issuing government takes on exponentially more and more debt, and anyone who still holds to this intellectually insulting premise is either profoundly ignorant of ALL of monetary history, or else is merely a shill and a lackey spreading the propaganda and disinformation of the power elite.  I cannot tolerate this deflationary bullshit talk any longer --- its clueless and/or dishonest proponents would have better luck trying to convince me that up is down and black is white.

Wed, 11/16/2011 - 10:00 | 1882284 SheepDog-One
SheepDog-One's picture

I dont see anything getting cheaper myself, they mean theyre worried that the FED's 'assets' are getting cheaper. They dont give a shit about what we have to pay to get by or wage deflation. 

Wed, 11/16/2011 - 10:15 | 1882347 island
island's picture

You're on-the-mark.  + a cool 1T

Wed, 11/16/2011 - 10:30 | 1882416 Hard1
Hard1's picture

You don't seee anything getting cheaper 'cause you don't work at Goldman.

Wed, 11/16/2011 - 11:50 | 1882762 jekyll island
jekyll island's picture

Housing is getting cheaper.  Real estate took the lead heading into the crash, we will not recover until it corrects, but the gubmint won't let it.  The Bernank can speak out of both sides of his mouth and you can have sector inflation in a deflationary environment. Or vice versa. 

Wed, 11/16/2011 - 10:05 | 1882308 centerline
centerline's picture

Demand destruction done the hard way!  The feedback loop lives.

Wed, 11/16/2011 - 10:14 | 1882343 Manthong
Manthong's picture

Everywhere but the S&P.

Wed, 11/16/2011 - 15:00 | 1883635 Chuck Walla
Chuck Walla's picture

Many in the bottom 60% are borrowing to meet the inflated prices of food & energy.  How long can that go on?

Wed, 11/16/2011 - 10:22 | 1882378 johngaltfla
johngaltfla's picture

Not exactly. Look at the chart I maintain tracking the "necessities" one needs to live off of. It is a nightmare as year over year we've had sustained increases in prices. The difference is that this month's "total" report shows a mild decline M-o-M. Y-o-Y the "official" rate is still increasing and for things you need to live, it is off the charts.

 

http://johngaltfla.com/wordpress/2011/11/16/october-c-p-i-for-necessitie...

Wed, 11/16/2011 - 10:51 | 1882522 GeezerGeek
GeezerGeek's picture

Being both a pack rat and a recent retiree (not by choice) I happened to be going through a pile of old magazines last week. I came upon some advertisements from major food stores dated January 2003. In 8 years prices for food have increased approximately 50%. I suspect that much of that increase happened in the last two years. Your chart showed food costs rising at only 5% YOY? It sure seems higher to me, and that ignores the recent increase in the price of peanut butter due to a bad harvest.

Wed, 11/16/2011 - 11:54 | 1882543 johngaltfla
johngaltfla's picture

That's 5% Y-o-Y PER MONTH. Remember, inflation is a cumulative data point, the prices have not reversed since the 08-09 collapse. In fact if anything using their own data and your eyeball calculations, 50% would be about right when considered with packaging and quality of goods inflationary practices. Remember the 5% from October of last year is on top of the 5% from September of last year. Month over month the index might change but one has to consider the hedonic calculations used to manipulate monthly data. The annualized report with revisions tells a shocking tale which you have picked up on.

 

Here is the cumulative inflation chart from 1990 through the September report per the FED for NSA inflation indexes same as my first chart:

http://johngaltfla.com/wordpress/wp-content/gallery/monthly_econ-charts/...

I'll update that chart when FRED makes the data available.

Wed, 11/16/2011 - 12:17 | 1882893 Bwahaha WAGFDSMB
Bwahaha WAGFDSMB's picture

1.05^8=1.48 5% compounded annually yields an increase of 48% in 8 years.  Intuition doesn't work very well when dealing with exponential growth.

Wed, 11/16/2011 - 09:43 | 1882180 ShortTheUS
ShortTheUS's picture

*DJ Fed's Bernanke: It's Free, Swipe Yo' QE3!

Wed, 11/16/2011 - 09:44 | 1882184 qussl3
qussl3's picture

Gotta love those stats nerds, where's crude and brent now?

Deflation my ass.

Wed, 11/16/2011 - 09:47 | 1882199 eigenvalue
eigenvalue's picture

This reminds me of the winter of 2007. Oil was strong with not so much fundamental support. 

Wed, 11/16/2011 - 09:52 | 1882239 qussl3
qussl3's picture

Was thinking the same thing, tho this time around high energy prices will blow up the EZ instead of housing.

2008 will be a cakewalk if the ECB doesnt backstop its banks.

Wed, 11/16/2011 - 10:06 | 1882313 Mike2756
Mike2756's picture

Banks? What are they going to do about the countries?

Wed, 11/16/2011 - 10:10 | 1882328 qussl3
qussl3's picture

The countries dont matter, the politicians will never let the people default, the public WILL pay.

But if the banks go boom, the rich may get hosed when the little people get pissed off enough to go into pitchfork mode.

Wed, 11/16/2011 - 10:11 | 1882331 SheepDog-One
SheepDog-One's picture

ECB backstop the banks...yep its like watching broke winos trying to borrow $5 bucks from each other.

Wed, 11/16/2011 - 10:00 | 1882288 e-recep
e-recep's picture

Is oil all you consume?

Wed, 11/16/2011 - 10:07 | 1882318 SheepDog-One
SheepDog-One's picture

No, but oil gets everything you consume to you.

Wed, 11/16/2011 - 10:39 | 1882473 boiltherich
boiltherich's picture

And sugar, they put it in everything now, both corn and cane, if sugar goes any higher Cuba will indeed become a workers paradise eh?

Wed, 11/16/2011 - 10:11 | 1882332 centerline
centerline's picture

Deflation is the primary trend.  That is what this whole mess is about.  If we had organic growth, the ponzi would continue.  The fact of the matter is that organic growth ran out decades ago.  Since then growth has been synthetic - leverage and credit.  Folks are too dumb to wake up to this because they only see prices going up.  That is nothing more than the byproduct of this synthetic economic growth (fucking with the fiat).

Wed, 11/16/2011 - 12:00 | 1882805 jekyll island
jekyll island's picture

Yes, there is deflation, that is why the fed is printing so much FRN$.   Since the banksters created all the (bad) debt out of their asses, it's all being crammed back up in there. Think of it like a patient:  can someone have heart disease and diabetes at the same time?  Deflation and inflation are not mutually exclusive, they can exist together AND they are being distorted by gubmint intervention.  

Wed, 11/16/2011 - 09:44 | 1882185 Silverhog
Silverhog's picture

Great, everything is getting cheaper except the shit you need.

Wed, 11/16/2011 - 09:46 | 1882197 Gief Gold Plox
Gief Gold Plox's picture

Ironically brought on by buying too much cheep Chinese shit you don't need.

Sadly a global story of our generation.

Wed, 11/16/2011 - 09:50 | 1882216 SheepDog-One
SheepDog-One's picture

Glad I was never a 'consumer monkey' always jonesing to charge the latest Chinese crap on credit. 

Wed, 11/16/2011 - 10:00 | 1882281 IrritableBowels
IrritableBowels's picture

Now's a great time to snatch a jumbo sized hi-def flat screen 3d 1080p 600Hz NFLX ready...blah blah blah.

Wed, 11/16/2011 - 10:01 | 1882291 SheepDog-One
SheepDog-One's picture

That will look great in the tent this winter.

Wed, 11/16/2011 - 11:51 | 1882765 mick_richfield
mick_richfield's picture

They made us get rid of the tents.

But we will overcome! 

I got an app on my iPhone that shows a picture of a campfire.

Wed, 11/16/2011 - 10:08 | 1882322 Overflow-admin
Overflow-admin's picture

hi-def = hi-deflation? LOL!

I prefer to sit on cash bullion... Hi-tech goods don't last enough, it's pure waste to rush on these products. Waiting for the crash to order a new computer.

Wed, 11/16/2011 - 10:19 | 1882363 centerline
centerline's picture

Cheep chinese shit sold to brainwashed consumers to keep a global ponzi alive for benefit of a few.  And among the "few" are various factions/players playing against each other on timelines much longer than we consider.

Wed, 11/16/2011 - 14:20 | 1883432 DosZap
DosZap's picture

As I do all the shopping the prices are astonishingly high.

In the past 2 yrs Albacore Tuna, has gone from $8.99 per 8pk, to $13.95. $5.00 friggin bucks a pack.

Anything edible or used in living (sustenance), is thru the roof.

Wed, 11/16/2011 - 09:45 | 1882188 Future Tense
Future Tense's picture

European debt write downs, the municipal failures in the United States, the deleveraging and aging consumers around the world, as well as the social mood explained perfectly by Robert Prechter is going to bring deflation first, just like Hugh Hendry believes.  The contagion is spreading rapidly through Europe and the debt to GDP picture I saw in this article yesterday explains it all:

http://www.ftense.com/2011/11/european-debt-to-gdp-map-french.html

Wed, 11/16/2011 - 09:45 | 1882190 The Axe
The Axe's picture

Tyler,  there is wage deflation. That is a concern to everyone!!!  

Wed, 11/16/2011 - 09:50 | 1882215 Global Hunter
Global Hunter's picture

wage deflation would be OK if things like food and gas deflated at a faster rate but they didn't, don't and after full scale printing begins will continue to won't.

Wed, 11/16/2011 - 10:02 | 1882299 e-recep
e-recep's picture

Well, human population cannot grow indefinitely, can it. There would be a stop or at least an interval. This mess we're in right now looks like one.

Wed, 11/16/2011 - 11:53 | 1882775 mick_richfield
mick_richfield's picture

Well, human population cannot grow indefinitely, can it.

Not here.

Wed, 11/16/2011 - 13:29 | 1883247 slewie the pi-rat
slewie the pi-rat's picture

yup!

note bien

when we start reading "think-tank stuff" about the "demographic problem" of too low birth rates and not enuf babies for future growth and funding liabilities/entitlements, maybe it's time to pause and check the wind vis-a-vis the mother ship and the bonfire of the insanities

L0L!!!   ...bondfire of the inanities? 

Wed, 11/16/2011 - 10:28 | 1882401 centerline
centerline's picture

Global wage arbitrage finally crashing on our shores.  Pushes us down while creating pressures to advance the Chinese middle class.  The current economic landscape is not molded for this.  So, we are trapped and so are the Chinese.  Epic fail as the players in the game all realize at once a stalemate condition.

Wage deflation creates demand destruction, which fuels deflation.  Right now we are in the middle of a huge dead cat consumer bounce fueled mainly by the college bubble and the flow of zombie money running scared, looking for yield and/or safety.

Wed, 11/16/2011 - 09:45 | 1882191 fonzanoon
fonzanoon's picture

well if there is deflation then supposedly the banks will be f'd right?

Wed, 11/16/2011 - 09:57 | 1882268 Dr. No
Dr. No's picture

First, if deflation was actually occuring, considering the banks have $1.6T in excess reserves (cash), I would say they are sittin pretty. The banks dont loose.

Besides, if a the circumstances were such that deflation harmed the banks and considering they control the money supply, you can bet there will be no deflation.

Wed, 11/16/2011 - 10:16 | 1882353 fonzanoon
fonzanoon's picture

Deflation is only happening in one area and that is housing. The more people go underwater and walk away from their homes the more the banks need to get bailed out again. The lower rates go and the more people refi or modify their loans the lower the profit margin becomes for the banks. I don't see any way they are sitting pretty. With that being said I am getting hammered on skf.

Wed, 11/16/2011 - 10:35 | 1882443 Dr. No
Dr. No's picture

many if not most of those mortgages were passed to Fannie and Freddie.  Hello taxpayer!  For those not purchased by Fannie/Freddy, see my note about the banks ability to controll money supply.

Wed, 11/16/2011 - 10:41 | 1882483 fonzanoon
fonzanoon's picture

Fair enough. But that means barely surving, I don't see how they are sitting pretty. I am considering closing my savings account at a major commercial bank. I bet you did not factor this in to your equation either.

Wed, 11/16/2011 - 11:11 | 1882597 Dr. No
Dr. No's picture

If barely surviving means rolling around in a $1.6T pile of cash with the ability to print more as needed, then yeah, I agree with your assessment.

Wed, 11/16/2011 - 11:31 | 1882679 fonzanoon
fonzanoon's picture

barely surviving means getting bailout out recently and probably needing to get bailed out again in the next 12 months. The banks are toast. It's just a matter of when and how. If you feel comfortable owning them then do what you have to do. I will wait it out and see what plays out.

Wed, 11/16/2011 - 11:35 | 1882690 fonzanoon
fonzanoon's picture

Citigroup is planning to cut as many as 900 jobs from its securities and banking division — and as many as 3,000 positions overall — as it grapples with turmoil in equity and debt markets, the Wall Street Journal reported Tuesday.

Wed, 11/16/2011 - 09:45 | 1882192 transaccountin
transaccountin's picture

WTI OIL ABOVE 100

HOPE AND CHANGE BABY

Wed, 11/16/2011 - 09:46 | 1882195 Pig Brotha
Pig Brotha's picture

Fuck it - as long as you don't eat, drive or want to keep warm this winter we're all good.

Wed, 11/16/2011 - 09:46 | 1882198 ArsoN
ArsoN's picture

Those IPads are getting more productive with each quarter...

Wed, 11/16/2011 - 09:47 | 1882201 Global Hunter
Global Hunter's picture

Print Print Print...you know you want to!!!

Wed, 11/16/2011 - 09:47 | 1882202 SheepDog-One
SheepDog-One's picture

QE is wildly unpopular theyre not going to touch it in their precious little political season. However, they dont NEED to print anymore, just the rumor of such nonsense is enough to fuel their vapor rallies.

Wed, 11/16/2011 - 09:49 | 1882209 Ignorance is bliss
Ignorance is bliss's picture

We need QE3 to kick the can past the 2012 Presidential elections. Afterwards, we will be going to a Gold standard because civil unrest and hyperinflation will be the top two concerns of every American in the country.

Wed, 11/16/2011 - 09:52 | 1882233 SheepDog-One
SheepDog-One's picture

I see it very differently...the last thing anyone except Bernank wants to mention is another 'bailout for the rich', ES futures may just love scanning headlines with 'QE3' in them, but to the voters nothing is more unpopular.

Wed, 11/16/2011 - 09:57 | 1882269 Ignorance is bliss
Ignorance is bliss's picture

They have no choice. We need to keep the financial system on its IV drip of cheap money, the Gov't needs to keep its wars going, and the American funded IMF needs to support a screwed up Europe. Twist is not big enough for the demands being palced on it. This is crunch time until a new system can be implemented.

Wed, 11/16/2011 - 10:03 | 1882301 SheepDog-One
SheepDog-One's picture

They have no choice about what, totaly pissing off the voters and $140 oil in their precious little 'election season' where no politician wants to be within solar system distance of a bailing out the ultra rich QE? Hey let em go for it, that would be hillarious....but they wont.

Wed, 11/16/2011 - 10:08 | 1882323 Ignorance is bliss
Ignorance is bliss's picture

Make no mistake QE3 is a hyper inflationary event, but its all they got left. Who would buy the bonds to keep the USS Amerika afloat? We are the greatest debtor nation the world has ever seen. These things never end well. All we can do is understand what is going to happen and plan accordingly.

Wed, 11/16/2011 - 10:14 | 1882339 SheepDog-One
SheepDog-One's picture

Be real careful about planning for 'QE3'. Theyre happy to let everyone think thats what theyre doing but if and when they dont, the 'QE hedge' items could suffer big deflation. 

Wed, 11/16/2011 - 10:21 | 1882370 Ignorance is bliss
Ignorance is bliss's picture

yawn...Its been fun if not very informative. Good luck

Wed, 11/16/2011 - 11:55 | 1882786 Waffen
Waffen's picture

Yep... its very sad. We all thought we had this figured out, that QE was what was driving the market and without it, it would tank. Well no QE for some time now and the market is still holding firm, metals are stuck, woe to anyone who invested money based on the "certainty."

 

 

Wed, 11/16/2011 - 12:06 | 1882840 jekyll island
jekyll island's picture

Going to a gold standard without pulling the fed's charter would rank as only a moral victory.  You have got to drive a stake through the vampire's heart or they will return for more blood. 

 

Wed, 11/16/2011 - 09:50 | 1882214 DormRoom
DormRoom's picture

.

Wed, 11/16/2011 - 09:50 | 1882219 Big Slick
Big Slick's picture

I pray for Nuremberg-type trials someday for those who illegally transferred trillions of private debt/bad assets to the public citizen and turned the world's reserve currency (ours) into toilet paper.

Greenspan will lead them.  Watch for the wet spot in little Timmy's pants.  I hope they make The Bernank shave that stupid beard.

Wed, 11/16/2011 - 10:01 | 1882295 Ignorance is bliss
Ignorance is bliss's picture

Why do we need Trials? I am pretty sure judge Dredd types will appear and vigilante justice will take over when hyperinflation gets going and the oil stops. We'll have Gaddaffi type Utube videos of our own leaders accounting for their actions directly with the people.

Wed, 11/16/2011 - 10:33 | 1882435 topcallingtroll
topcallingtroll's picture

Everyone knows who to target.

If somebody ever did take out Blankfein, Mozillo, Paulson, etc then I will build a statue in their honor.

Stop your meds. Listen to that voice in your head. It is god giving you instructions. You do follow god's will right?

Wed, 11/16/2011 - 11:40 | 1882717 Big Slick
Big Slick's picture

Speaking of meds, time to get back on yours, topcall.  ;)

 

Wed, 11/16/2011 - 11:09 | 1882588 GeezerGeek
GeezerGeek's picture

We need trials because the alternative is mob rule. The trials must be based on the rule of law, however, something that has been sorely lacking in recent years. I, for one, do not want to witness something akin to the French Revolution here. If you're not familiar with it, do some reading. The trials they had were farcical.

Wed, 11/16/2011 - 11:57 | 1882796 Waffen
Waffen's picture

We will be so broke, how will we get a hold of all these rich people living abroad, probably in China or south America?

Wed, 11/16/2011 - 09:51 | 1882225 g speed
g speed's picture

won't print --just backstop IMF so it can bail out Europe-- same old shit-- FED protects banks around the world and you get to pay with inflation tax--

Wed, 11/16/2011 - 09:52 | 1882234 Oswald Spengler
Oswald Spengler's picture

We're all Greeks now. My girl friend is even considering back door love. 

Wed, 11/16/2011 - 10:01 | 1882294 IrritableBowels
IrritableBowels's picture

coffee that was in my mouth is now on the table.

Wed, 11/16/2011 - 10:18 | 1882360 boiltherich
boiltherich's picture

Irritable Bowels thinks that anal sex is hilarious....  Is this a Yalie?

But seriously, do not give into your girlfriend because anal sex is a slippery slope to homosexuality, once you realize it can be clean and tighter better intercourse how long will it be till you are doing it with just anyone?  It is gateway sex. 

Wed, 11/16/2011 - 10:37 | 1882457 topcallingtroll
topcallingtroll's picture

Do not have anal sex with an ethnic type that eats lots of hot foods.

It burns. Oh the pain!

I kid you not, unless my large penus is extra sensitive.

Wed, 11/16/2011 - 14:47 | 1883568 DosZap
DosZap's picture

topcallingtroll

When you learn to spell your appendage,we will take you seriously.

Wed, 11/16/2011 - 16:13 | 1883985 akak
akak's picture

Maybe he spelled it that way because he is Latin.

(But myself, I find their dark purple genitalia rather repellent.)

Wed, 11/16/2011 - 09:53 | 1882241 holdbuysell
holdbuysell's picture

"a carton of milk now assumed to have a rearview camera, power steering and ABS brakes (as per the BLS)"

Now that's funny. Nice one.

Wed, 11/16/2011 - 09:53 | 1882243 Bansters-in-my-...
Bansters-in-my- feces's picture

Deflation is for delusioalist.

Fuck you's ly'n sacks of shit  statistic dudes/dudettes.

Wed, 11/16/2011 - 09:54 | 1882249 kito
kito's picture

are you still talking about qe3? dude, your wife left and shes not coming back, get over it

Wed, 11/16/2011 - 09:55 | 1882257 SheepDog-One
SheepDog-One's picture

LMAO

Wed, 11/16/2011 - 09:58 | 1882277 holdbuysell
holdbuysell's picture

But she's been replaced by M0 who's promised to go through periodic 'augmentation' enhancements until she dies.

Wed, 11/16/2011 - 12:15 | 1882882 WhiteNight123129
WhiteNight123129's picture

OK Kito.

Here why you won t see deflation: M2 growth at 20%. Check out this page.

http://www.alsosprachanalyst.com/economy/pboc-broadened-the-definition-o...

 

China prints only Inflation in China lies so much that the electricity companies are in deep losses as well as gas distribution companies in mainland China.

Check this one:

http://news.xinhuanet.com/english2010/indepth/2011-11/14/c_131246449.htm

 

Walmart was warnign about inflation in March and said the company would be affected by the end of the year.

http://www.usatoday.com/money/industries/retail/2011-03-30-wal-mart-ceo-...

Here you have it, a classic push cost, with revenues beating while profits are down at Walmart.

http://online.wsj.com/article/BT-CO-20111115-706803.html

 

China has always dealt with banking crisis by pumping every 10 years since 1949. After the latest pumping in 2000 the consumption share of GDP plunged, so the people of China always paid for the bank mop-up.

Until you see deflation in China (not supposed or whatever deflation = less than 5% inflation, or some other BS.) Deflation is Japan with no bail out of banks, very little pumping, have the stock market, the banks and the conglomerates repay the hard way with hard yen, no recut of debt principal through direct bailout or through money pumping inflation. Japan never experience neither inflation nor high unemployment up until 2008. Check the misery index in US. Since GDP touch 0% growth in 1992, Japan has the same price index. Since we touch bottom in late 2008 on economic activity, inflation index has already recouped 7.6%. While economic activity has not recouped since 2007 , inflation index is already above the 2007 peak activity level = stagflation.

Not Japan whatsoever.

I am using official BLS statistics! Stagflation is back again, Rosenberg is wrong, there was no magic vaccine against stagflation which was invented. Subpar capacity utilization and inflation are teh order of the day.

 

 

Wed, 11/16/2011 - 12:17 | 1882891 WhiteNight123129
WhiteNight123129's picture

To summarize: China inflation = Walmart costs = Consumer inflation on basic necessities. Energy well look at oil price.

Japan situation = USA situation, we are light years away from that.

Wed, 11/16/2011 - 10:02 | 1882296 g speed
g speed's picture

The more I think about it the more I think the Count Daracula had the right idea ---stick the deserving enemy on poles along the road as a deterant, so to speak.  lets see-- TOTPOTS-- (tyranny of the person over the state) and BAPAKOLP--(bankers and politicians and kings on long poles) its like a new language--bapakolp totpots! (or how you doing today pardner).

Wed, 11/16/2011 - 10:04 | 1882303 firstdivision
firstdivision's picture

Need moar iPads!  Me hungry

Wed, 11/16/2011 - 10:08 | 1882320 Mike2756
Mike2756's picture

They have to print 1T just to get back to zero point zero.

Wed, 11/16/2011 - 10:11 | 1882333 Stack Trace
Stack Trace's picture

There is no deflation except for the space between Bernanke's ears.

Wed, 11/16/2011 - 10:11 | 1882334 boiltherich
boiltherich's picture

0.01%?  Starbucks went up 10% on their coffee menu yesterday so I guess that is in BLS speak about 0.01%.  Turkey for the Thanksgiving table up 30% from last year, remember when they practically gave those away as lost leaders?  The last time I bought one was Tday 2004 when my Mom was still alive, I am pretty sure it was $9 for a 17 pound bird, it is close to triple that now.  But just in the last year I see so many things that I used to buy regularly that have doubled or well more than, like spicy brown mustard, it ruined me for regular mustard, but it is now more than double last years' price.  I do not even go into the produce section anymore, and meat, they should have smelling salts on a string next to the plastic bag rolls.   And rice, sugar, coffee, potatoes, oil, breads, frozen vegetables, in Safeway the tiny one serving can of vegetables is now the same price as the big cans families buy, basic stuff all way more than doubled.  I can do a fair amount of substitution and eat a lot less meat, but, food generally is eating me more than I am eating it.  I don't know how a family gets by even with food stamps. 

Wed, 11/16/2011 - 10:18 | 1882359 SheepDog-One
SheepDog-One's picture

Yes food is just about a double at this point. I used to buy liters of Coke for 2/$1, those are $2 each now. Meats are ridiculous, looking at beef tenderloin to make beef Wellington for Christmas dinner, $15 a pound.

Wed, 11/16/2011 - 10:23 | 1882379 boiltherich
boiltherich's picture

SheepDoggie, I will send you a recipe for hamburger Wellington, of course now that hamburger is almost $6 a pound you better hurry before the recipe becomes road kill possum Wellington, a favorite in Alabama I hear. 

Wed, 11/16/2011 - 10:41 | 1882484 topcallingtroll
topcallingtroll's picture

Six bucks a pound?

You homos must be shopping at a prissy little organic food store, or you are falling for the black angus bullshit.

A cow is a fucking cow man. I dont give a shit who its parents were.

Wed, 11/16/2011 - 16:16 | 1884003 akak
akak's picture

A cow is a fucking cow man. I dont give a shit who its parents were.

That's just your excuse for dating Janet Napolitano.

Wed, 11/16/2011 - 17:29 | 1884530 boiltherich
boiltherich's picture

Regular hamburger at Safeway here is $5.59 per pound troll, but a friend of mine who works in the meat department there says stock up because says he it is going up over Thanksgiving when nobody eats hamburger for about a week so they are not going to notice.  And no I shop at normal stores because I am like other gay people, we are EVERYWHERE.  But the last time I was in the hippy organic store for bulk spices at a fraction of the Safeway cost it absolutely filled to capacity with dirty little breeders, and not one of my gay friends would have anything to do with such a tacky place. 

Wed, 11/16/2011 - 11:30 | 1882668 bonderøven-farm ass
bonderøven-farm ass's picture

No till gardening, French Intensive and Companion Planting in a bed 20' x 60' feeds us all Summer (find good sources for manure and cardboard), passively heating your greenhouse and using row cover on your beds inside (15'X40' feeds us all Winter:  we're in the S. Appalachians, but the method works even as far as Maine).....fuck 'commercial', dyed, GMO, run-of-the-mill Monsanto test-tube food-stuffs.  Grow yer own bitchezz..........!

Wed, 11/16/2011 - 11:23 | 1882639 GeezerGeek
GeezerGeek's picture

Double from when? What was the year when you could by a liter of Coke for $0.50? It's like saying I once could have purchased - but for lack of money - a new Ferrari for $12,500. That was in 1962 and bears little relevance to recent price increases.

Wed, 11/16/2011 - 10:21 | 1882373 undercover brother
undercover brother's picture

no way today's early down holds.  wti over ramps almost to 101...wonder why?  its only a matter of time before the correlation algos kick in and buy spy, euro, gold.  wait, is there a disconnect begnning....perish the thought!   and by the way, these quant jocks will massage the data any way they want, with or without energy, with or withough food, anything to make their case about the deflation story, which in the real world, beyond that of gov't statistics, is complete nonsense. 

Wed, 11/16/2011 - 10:52 | 1882526 bill1102inf
bill1102inf's picture

Its obvious folks that we are in a BEEF/CHICKEN/TURKEY bubble.  Its the farmers chance to make CEO like profits. Not only has their profit gone up 100's of % but I am sure they are borrowing as much as they can, re mortgaging the farm, re financing any equipment, etc etc.  Anything to squeeeeeeeze that last drops of fiat out of this economy and into their pockets.

Wed, 11/16/2011 - 11:01 | 1882555 hannah
hannah's picture

oil went from $90 to $70 area so energy did get cheaper for a few weeks. what is stupid is that the fed always EXCLUDES energy and food and now they want to include it for one month and justify QE3.....thats too funny.

Wed, 11/16/2011 - 11:06 | 1882579 treemagnet
treemagnet's picture

All I know is my coffee is becoming a luxury.  Case of shitty average beer is like a $1 can without booze taxes, sales tax, etc.  For Bud?!

Wed, 11/16/2011 - 11:07 | 1882586 Alex Kintner
Alex Kintner's picture

These CPI guys apparently don't shop at my grocery store. What BS the CPI is.

Wed, 11/16/2011 - 14:51 | 1883591 DosZap
DosZap's picture

These CPI guys apparently don't shop at my grocery store. What BS the CPI is.

Because they are not ALLOWED to show food AND FUEL IN THE NUMBERS.

Wed, 11/16/2011 - 11:15 | 1882614 DavidC
Wed, 11/16/2011 - 13:54 | 1883269 bulldung
bulldung's picture

The MIT Billion Price Project seems to be tracking close to the Govt data through 9/28 shows some leveling off about 0.5%. bpp.mit.edu/usa  Does anyone know much about whether this data is corrupted? Seems reliable to me.

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