"The Consumer Price Index, the government's key inflation measure, rose 0.3%, compared to February, when prices were unchanged. The gain matched the forecasts of economists surveyed by Briefing.com."
- Just up 0.3% in a month, overall? Thus, it cost you just $100.30 for what cost you $100 in February. Does this match anybody's perceptions?
"The price of energy jumped 1.9% percent in the month." So, in other words, if a typical consumer paid $3.20 for a gallon gas in February, that same gallon would have cost about $3.26 in March, Up about 6 cents. Does this match anybody's exprience? I saw gasoline rise 6 cents a gallon in just one week in Florida in March.
But, there is more good news in this story:
"But the fact that the CPI report showed consumer inflation as roughly in line with forecasts should assure investors who are hoping for further interest rate cuts from the central bank." Well, we know that money supply expansion precedes price inflation. so, you can't gauge the proper interest rate on how prices are behaving currently. That is fuzzy headed thinking. If the federal reserve bank does that, it will overshoot the target and by the time the prices start leaping, it wil be too late to contain it by anyting short of drastic and hurtful interest rate jumps.
I think these statements in the article are some examples of fantasy over fact:
"Health care prices rose 0.1%."
Really? That is all?
Food and beverage prices gained 0.2%, as a jump in the price of fresh vegetables, baked goods, sugar and sweets were balanced by declines in prices for dairy and related products."
Dairy prices went down? And how do "dairy and related" price reductions, even if they happened, manage to balance off vegetables, baked goods, sugar and sweets? I'd guess that the latter account for 3X the value of sales of the former.
I'd like to see the "shopping basket" comparison, item by item, but cannot locate it on the BLS website. I am guessing they do not want to show the specifics becuase it would raise too many eyebrows.
Last edited by Denny on Wed Apr 16, 2008 2:21 pm; edited 1 time in total
Posted: Wed Apr 16, 2008 1:56 pm Post subject: Re: CPI updated - is it believable?
I am not sure which planet they are referring to. This planet is seeing unprecedented increases in ...well just about everything. That report is hogwash
Overall, food prices jumped 4 percent in 2007 compared to average yearly increases of 2.5 percent for the previous 15 years, US Department of Agriculture data show.
Hmmm. Only 4%? I'd like to know where they're shopping. Because in my estimation, it's more like 50% overall. Of course, that's strictly anecdotal...
Posted: Wed Apr 16, 2008 2:07 pm Post subject: Re: CPI updated - is it believable?
The CPI is bogus; it is used to temper the COLA increases in SSI & other entitlement benefits. Can you imagine it any other way? _________________ "It's called the American Dream because you'd have to be asleep to believe it."
Posted: Wed Apr 16, 2008 2:22 pm Post subject: Re: CPI updated - is it believable?
vision-master wrote:
emersonbiggins wrote:
The CPI is bogus; it is used to temper the COLA increases in SSI & other entitlement benefits. Can you imagine it any other way?
SSI pays a single $637 Month. So with CPI at .03% maybe they will get $656 a Month next year. How's dem apples.
...sounds like granny is taking a 20% haircut (at least)
On the bright side, LCD TVs should still be getting cheaper, which is good, because her old one stops working next year. _________________ "It's called the American Dream because you'd have to be asleep to believe it."
Joined: May 18, 2006 Posts: 3962 Location: Minneapolis, MN
Posted: Wed Apr 16, 2008 2:31 pm Post subject: Re: CPI updated - is it believable?
emersonbiggins wrote:
vision-master wrote:
emersonbiggins wrote:
The CPI is bogus; it is used to temper the COLA increases in SSI & other entitlement benefits. Can you imagine it any other way?
SSI pays a single $637 Month. So with CPI at .03% maybe they will get $656 a Month next year. How's dem apples.
...sounds like granny is taking a 20% haircut (at least)
On the bright side, LCD TVs should still be getting cheaper, which is good, because her old one stops working next year.
Converter box coupon good for $40. Best buy has em boxes for $59. So, granny can get set up for about $20. I picked one up for the 36" analog set. The dang thing works great. A nice very sharp picture just like my big screen.
Posted: Wed Apr 16, 2008 2:34 pm Post subject: Re: CPI updated - is it believable?
vision-master wrote:
emersonbiggins wrote:
vision-master wrote:
emersonbiggins wrote:
The CPI is bogus; it is used to temper the COLA increases in SSI & other entitlement benefits. Can you imagine it any other way?
SSI pays a single $637 Month. So with CPI at .03% maybe they will get $656 a Month next year. How's dem apples.
...sounds like granny is taking a 20% haircut (at least)
On the bright side, LCD TVs should still be getting cheaper, which is good, because her old one stops working next year.
Converter box coupon good for $40. Best buy has em boxes for $59. So, granny can get set up for about $20. I picked one up for the 36" analog set. The dang thing works great. A nice very sharp picture just like my big screen.
Hmmmm, maybe granny's in better shape than I thought! She might not be able to afford the last week of the month anymore, but she'll get to watch her "stories"! _________________ "It's called the American Dream because you'd have to be asleep to believe it."
Posted: Wed Apr 16, 2008 2:35 pm Post subject: Re: CPI updated - is it believable?
According to this commodity chart website Trading charts the average price for a gallon of gasoline in February was $2.43. For March, it was $2.67. That is an increase of 9.87%, month over month, not 1.8% And, that closer mirrors the complaints I heard from everybody when I visited Florida in March.
Where does BLS sample their gas prices?
If you check the website, you can click on each weekly bar on the graph and a description will show up showing the open, high, low and close price for each week. I used the weekly close prices.
Posted: Wed Apr 16, 2008 2:39 pm Post subject: Re: CPI updated - is it believable?
Apparently, their sample runs mid-month to mid-month. This is why February showed a DECREASE (IIRC) in gas prices, because of the timing of the report, which just happened to end at the lowest price of the month. The actual month of February, e.g. 2/1 - 2/29, showed a marked INCREASE, though. _________________ "It's called the American Dream because you'd have to be asleep to believe it."
Posted: Wed Apr 16, 2008 3:00 pm Post subject: Re: CPI updated - is it believable?
Quote:
emersonbiggins wrote: The CPI is bogus; it is used to temper the COLA increases in SSI & other entitlement benefits. Can you imagine it any other way?
There is an excellent piece discussing the systematic distortion of the CPI over the years resulting in reduced SSI, et al. benefits payments in this month's (May 2008) Harper's Magazine. Unfortunately its behind a paywall here:
Posted: Wed Apr 16, 2008 3:13 pm Post subject: Re: CPI updated - is it believable?
Tyler_JC wrote:
The price of ENERGY rose 1.9% last month.
They never said gasoline rose 1.9% last month.
Gasoline is not 100% of all energy consumption.
Well, actually they said:
Quote:
...energy expenses jumped 1.9 percent, the most since November, after a decrease of 0.5 percent the prior month. Gasoline prices rose 1.3 percent, fuel oil costs jumped 10.1 percent and natural gas prices were up 4.6 percent. link
So, "cheap" gasoline tempered the rate from going even higher.
Does anyone on this planet actually think gasoline only went up 3-4 cents last month?
Oh, and thanks to Shane for the links! _________________ "It's called the American Dream because you'd have to be asleep to believe it."
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