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Posts Tagged ‘Consumer price index’

Why Might The Fed’s Party Be Over?

Posted by Larry Doyle on June 20th, 2011 8:07 AM |

Over the last few years I have highlighted the fact that the deflationary impact of declining wages and home values gave cover to the Federal Reserve for maintaining an excessively easy monetary policy and pumping up asset prices via quantitative easing. That party would now seem to be over. Why?

There is no doubt that Fed chair Bernanke’s easy money has played an integral role in the inflation we are experiencing at the pump, in the supermarket, and across a number of other commodities.

As we continue to navigate the U.S. economic landscape circa 2011 and beyond, the ongoing decline in home values in many regions of our nation now would seem to be setting the table for an inflationary spike in housing costs. How so? What is going on here?  (more…)

David Rosenberg’s Sense on Cents

Posted by Larry Doyle on May 4th, 2011 5:39 AM |

David Rosenberg is a Sense on Cents All-Star. While many do not agree with Rosenberg’s overall assessments of the economy and the markets, I have untold appreciation and respect for his thoughtful and astute analysis. He recently spoke at an investment conference. Robert Huebscher of Advisor Perspectives captured Rosenberg’s thoughts in his piece, My Breakfast with Dave.

For those with even a passing interest in the economy and markets, I strongly recommend even a cursory review of Rosenberg’s remarks as he offers keen insights on a variety of angles and impacts embedded in the ongoing inflation vs deflation debate. What does Dave see for commodities, housing, interest rates? Read on….a wealth of ‘sense on cents’ awaits you. (more…)

Stagflation…and More Market Moving News

Posted by Larry Doyle on February 27th, 2009 8:51 AM |

breaking-newsU.S. Economy Shrank 6.2% in Fourth Quarter, Most Since 1982  from initial report of -3.8%. Price   index in the GDP report revised up to .5% from initial   reporting of .1%

Both sides of this report, along with the recently reported higher than expected CPI (consumer price index) and PPI (producer price index) certainly seem to be pointing toward a greater likelihood of “stagflation. ” Our economy has not experienced that dreaded scenario since the early ’80s. 

Additionally, Citi Gets Third Rescue as U.S. Plans to Raise Stake IF privately held preferred shareholders do the same. What does this mean? Current common equity holders in Citi will be significantly diluted and the U.S. taxpayer is moving into a first loss position. Why is the government doing this? Very simply because Citi would otherwise likely lose counterparties willing to trade with it given the concerns of losses embedded in its holdings of toxic mortgage assets.

Market reaction? Stock index futures are pointing toward a 2% decline!

LD






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