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PeakTrader said...

It seems, we're either heading into stagflation or a double-dip, because the annualized core inflation rate is 2.1%, which exceeds the Fed's 2.0% upper limit, while the economy is underproducing by $1 trillion a year, and with $1 1/2 trillion annual budget deficits.

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PeakTrader said...

Those who believe inflation is understated or real GDP (real income = real output) is overstated don't seem to understand incomes tend to rise over time, while monthly payments tend to remain fixed or rise less. So, real income rises.

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PeakTrader said...

Let's see, my housing payment is the same, auto payment the same, insurance payments the same, AT&T bill the same, medical & dental co-payments the same, I bought food, some of it was 50% off, bought gasoline that was cheaper than a year ago, and bought some clothes not long ago, which was a great bargain.

No inflation here, for years, although some prices went up and down.

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Johnny Bee Dawg said...

"...AT&T bill the same, medical & dental co-payments the same, I bought food, some of it was 50% off, bought gasoline that was cheaper than a year ago, and bought some clothes not long ago, which was a great bargain"...

This is exactly what I am experiencing, except I eliminated my $90 per month AT&T bill completely and use the free minutes and long distance from my cellular contract. Also refinancing my house saved me $400 a month. My income is UP from 4 years ago, while my expenses have actually dropped.

There are constant deals at the grocery store. General Mills cereal was on sale $2 a box 3 weeks ago. We still havent finished it all yet. Pork shoulder was 99 cents a pound 2 weeks ago, while Prime Rib Eye Steak was only $13 a pound last nite. (While beef futures zoomed around, I was buying Prime last nite on special at less than I can remember in YEARS. In fact, 5 years ago, I couldnt even buy prime at a grocery store in my town.) We spend no more than 4 years ago, or even one year ago, and have more choices and better food.

FYI, Subway has $2 subs all month. Jos Bank Clothiers has buy 1 get 3 free on everything. Clothing is practically free when you buy on sale these days.

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Chart - U.S. output gap:

http://www.economonitor.com/dolanecon/files/2011/11/P111124-5a.png

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E.U. Forecast in link

http://www.blogger.com/comment.g?blogID=28997633&postID=687150345125665810

http://www.blogger.com/comment.g?blogID=28997633&postID=3288360080040887750