Tuesday, June 16, 2009
The first of the 2 monthly inflation reports was released today: PPI 0.2% month over month increase (lower than forecast).
On a year over year basis, producer prices have fallen 4.7%. This is rarefied territory for our country. This is not hyper-inflationary by the way.
In fact, it is continued deflation. Don't take your eye of the ball my friends. How many hyper-inflationary periods have started with 40% declines in home prices? How many times have gold buyers tried to push the price over (convincingly) $1,000? How many jobs have been lost the the last 18 months? How much have PRIVATE & CORPORATE borrowing decreased?
There is a big jump from where we are now to hyper-inflation.
Oh, and for all of those who have been saying "the market is bidding up oil and commodities and who knows better than the market. It is self fulfilling."
Just like when oil was $140.00 bbl..................