Professor Krugman, in a valiant attempt to deny that the only effect of QE2 was to raise the price of equities, and more importantly, commodities, advocated the use of "core" inflation measures rather than the headline number.I've got it!
When headline bled through to core he switched this metric to the Atlanta Fed's "sticky" price CPI (i.e. prices that don't change). I'm not sure how he's going to spin this latest...
He's going to say, in either a Tarzan or Frankenstein voice, "Inflation gooood".
From the Market Ticker:
What's the "misery index" again? I seem to remember it being 12-month chained inflation and unemployment. Well?
The Consumer Price Index for All Urban Consumers (CPI-U) increased 0.4 percent in August on a seasonally adjusted basis, the U.S. Bureau of Labor Statistics reported today. Over the last 12 months, the all items index increased 3.8 percent before seasonal adjustment.But but but.... there's no inflation, right?
The index for all items less food and energy increased 0.2 percent in August, the same increase as the previous month. Shelter and apparel were the biggest contributors, though the indexes for most of its major components posted increases, including used cars and trucks, medical care, household furnishings and operations, recreation, tobacco, and personal care. The new vehicles index, unchanged for the second month in a row, was an exception.The "but it's all energy prices and they're volatile" excuse is long in the tooth and running out of gas. That dog won't hunt any more folks....Of course Senior Citizens who were prudent and saved don't have a problem with this, right? After all they don't need to buy food or energy... and neither does anyone else.... right?...MOREThe energy index has risen 18.4 percent over the last year, while the food index has increased 4.6 percent.
