So there’s two problems with that announcement: inflation increased (again!) and economists’ forecasts were wrong (again!). Here’s the article.
Some details: The Consumer Price Index moved up 0.4% last month. Forecasts called for an increase of 0.3%. So is that like missing the high temperature by 5 or 10 degrees? Or is it more like missing the precipitation forecast by 0.5″ or 1.0″? Tell me people wouldn’t freak out about either one.
More on this and related news below.
The rise in January left overall prices 4.3% above where they were 12 months earlier, up from the 4.1% rise on that basis in December. That’s right: inflation is up by 4.3%. Did you get a larger raise in the last year? A substantially larger raise? Because with the dollar’s free-fall (somehow good by conservative economic standards), your money is buying less even if you kept up with inflation in the last year. Even if the average person walking down the street couldn’t identify the numbers associated with this, they recognize on some level the economy isn’t doing for them what it’s doing for Bush’s base: the top 1%.
One more thing that bothers me: economists like to pare down the CPI to the Core CPI. It neglects the effects of ‘volatile’ food and energy prices. Because economists hate volatility, I guess it’s acceptable to simply toss it out. Note that if the weather forecasts tossed out volatile cases, there really would be no one paying attention to them. By the same token, we still have to pay for higher food prices if those prices go up. The same goes for fuel. There’s no waiting to pay for these goods until the prices come back down (if they ever do).
As a for instance, food prices jumped 0.7% last month. As a result, I’m buying different foods than I was a year or two ago. I have to. My income hasn’t kept pace with inflation since Bush took office. It seems to me that economists like to make up numbers to help make themselves feel better when things aren’t going so well.
bonddad has more
The Sharper Image filed for bankruptcy. People don’t have the disposable income necessary o buy new gadgets when they’re having trouble paying for food.
The unemployment figures for the U.S. leave a lot to be desired. Here’s an article on some other ways to look at what’s under the hood of unemployment. Good quote:
‘These statistics suggest that if the United States is in a recession — still a subject of debate among economists — the nation is entering an economic contraction with a much higher rate of chronically unemployed than it did during the nine-month recession in 2001.
“It’s a critically important linchpin because, although we get excited about every bip and bop in the stock market, it’s the labor market that matters most to most people. They’re depending on their paycheck, not their stock portfolios,” Bernstein said. “If the labor market is not producing enough jobs or hours of work, that’s going to show up as diminished income growth and less consumption.”‘ [Bold is my emphasis.]
Bingo. The Bushies would have everyone believe that because the stock market has done well in the past seven years, the economy is humming along nicely. The problem is, most people don’t have stock portfolios.