CPI – Page 2 – The Burning Platform

GOVERNMENT IS THE PROBLEM

Here are two charts that show how successful, government solutions are for the citizens of this country. First off, even according to the manipulated and under-reported CPI figures, you have lost 65% of your purchasing power since 1978. Using a real measure of inflation, its closer to 85%, but why quibble. You are slowly but surely being impoverished by the Federal Reserve (aka Wall Street bankers) and the corrupt politicians you elected to represent your interests.

Doug Short presents the cost of college tuition, medical care and new cars over the last 38 years. One of these things is not like the other. The second chart shows the growth in Federal loans to students since 1995. You may notice that prior to the Federal government getting involved in college education, college tuition rose steeper than overall inflation but only by a moderate amount. My tuition at Drexel University in the mid-1980s was in the mid $5,000 range. I was able to work and pay the majority of my tuition, with only a couple thousand dollars in loans.

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If you are perceptive (that leaves out all libs and government employees) you will notice that as the Federal government has doled out more loans, the cost of college tuition has skyrocketed. You see, just like welfare, you get more of what you subsidize. If the federal government is willing to give your tax dollars to every Tom, Muhammed, or Laquesha to go to college, demand will rise. Since the supply is limited, colleges can raise prices dramatically as they know the Feds are supplying the paper.

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Fed Cornered: Core CPI Jumps Near 4 Year Highs As Rent Rises At Fastest Rate In 9 Years

If the government is admitting inflation is running at a 4.8% rate over the last three months, then you can double that to get the real rate. With wages growing at 2.5%, do you understand why most of the country is pissed off as they become more impoverished every day?

When you see unemployment supposedly below 5%, unemployment claims at three decade lows, inflation running at 4.8%, corporate profits near record levels, Wall Street reporting billions in profits, and politicians expounding upon our resilient economy, why is Janet Yellen keeping rates at .25%?

If these economic figures were true, the Fed should have short term rates at 2% or higher.

Could it be the emergency level interest rates have nothing to do with the economy and everything to do with enriching her banker benefactors and the corporate establishment?

by Tyler Durden

Jul 15, 2016 8:59 AM

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Just as we warned, the gas price ‘base effect’ is pressuring consumer price indices higher (Energy +1.3% MoM – up for 3rd month in a row) but even Core CPI rose more than expected (+2.3% vs 2.2% exp) back near its highest since April 2012. Shelter costs rose 0.3% MoM (but 3.5% YoY – the highest since July 2007), along with increases in education, medical care, and airline fares also sent consumer prices broadly higher. Between surging PPI and this, The Fed is increasingly cornered (and as we nopted last night, running out of excuses).

“We’re starting to see upward pressure on the inflation numbers,” Jim O’Sullivan, chief U.S. economist at High Frequency Economics Ltd., said before the report. “It reinforces the case for the Fed to resume tightening, though they’re highly risk averse right now.”

Core Cpi back near cycle highs…

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HARD TIMES & FALSE NARRATIVES

The mainstream media mouthpieces for the establishment peddle false narratives, disingenuous storylines, and outright propaganda to keep the ignorant masses confused, oblivious to reality, misinformed, and passively submissive to the opinions of highly paid “experts” and captured fiscal authorities. The existing social order likes things just as they are.

They reap ill-gotten riches, wield unchecked power, and control the minds of the masses. They are the invisible government consciously manipulating the minds, habits and opinions of the multitudes in order to dominate society, control the levers of government, and accumulate obscene levels of wealth through manipulation of the currency and domination of the banking and corporate interests.

One of the false narratives being flogged by the establishment propaganda peddlers is the mass retirement of Baby Boomers causing the plunge in the employment to population rate from 64.4% in 2000 to 59.7% today. They need to peddle this drivel, because the difference between these two rates amounts to 12 million missing jobs. The employment to population ratio is currently at 1984 levels. Any critical thinking person with basic math skills realizes the government reported unemployment rate of 5% is an Orwellian farce.

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The Fed has fueled inflation — and it’s helping the rich

Guest Post by John Coumarianos

Higher stock and real estate prices don’t benefit average Americans

It may come as no surprise that in the aftermath of an epic single-family housing boom and subsequent bust, millions of more people have been renting — without much new multifamily housing supply until recently.

This situation has let to strong gains for apartment REITs and an astonishing ability for property owners to raise rents.

Now a research paper by Rob Arnott and Lillian Wu of Research Affiliates in Newport Beach, Calif. asks why the CPI doesn’t reflect the inflation that is apparent in places where people spend their money.

Arnott and Wu argue that the four biggest expenditures for most people — rent, food, energy, and health care — have been rising. Since 1995, rents have been rising at 2.7% clip, energy at a 3.9%, food at 2.6%, and health care at 3.6%. Notably, these four expenses account for 60% of the aggregate of people’s budgets, 80% of middle-class budgets, and 90% of the budgets of the working poor.

Indeed, these Four Horsemen are galloping along, outstripping headline CPI, but it has taken six years of massive government spending, borrowing, and central bank stimulus for real per-capita GDP to regain its pre-recession peak.

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Consumer Prices Jump Most In Over 3 Years Amid Rising Gasoline, Rent Inflation

Even the liars at the BLS can’t cover-up the raging inflation in gasoline, natural gas, rent, medical expenses, and food. I thought Janet was waiting for a little inflation before raising rates. I guess she’ll need a new excuse not to raise rates as the CPI is rising at an annualized rate of 4.8% according to the bullshit artists at the BLS. It’s over 10% for people living in the real world.

Submitted by Tyler Durden on 05/17/2016 08:41 -0400

Headline CPI rose 0.4% MoM (above +0.3% exp) for the biggest jump since Feb 2013 but sadly at the same time, price-adjusted hourly wages slid 0.1% in April.

Following a small drop in March, from 8 year highs, Core (ex food and energy) Consumer Prices rose 2.1% YoY (as expected) abesent the effect of Gasoline’s huge 8.1% MoM surge.

Of course this is probably transitory but we note that rent inflation remains at 3.7% YoY – its highest since 2008 and definitively not transitory.

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LIES, LIES AND OMG, MORE LIES

It’s that time of year again. It’s open enrollment for health plans at my employer. They are biggest employer in Philly and have the most leverage possible with the insurance companies. They have such good leverage that my premiums are going up “only” 9.8% this year for a basic HMO plan. Based on what I hear from others, I should be thankful for just a 9.8% increase.

This isn’t a new development. Since I’ve been tracking all my expenditures using Quicken since 1991, I know exactly what my annual health insurance costs have been every year. Obamacare was passed in 2009 and began to be implemented in 2010. Obama declared that families could expect $2,500 of savings per year. I know for a fact my annual medical expenses were $2,000 higher in 2015 than they were in 2010.

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Natural Gas Prices Should Double

Gasoline prices are already up 30% from their lows in a matter of weeks. That’s how fast things can change in the real world. As more and more oil companies tied to oil and natural gas fracking declare bankruptcy in 2016/2017, the over supply will disappear and prices will rise. Art uses facts to predict natural gas prices will double in the next twelve months.

Luckily, none of us use gasoline for our cars or natural gas for heat and cooking. So, the 30% to 100% increase in these costs won’t effect that CPI number that Yellen keeps telling us is too low. As even the fake BLS inflation numbers jump above 3%, old lady Yellen will say it’s temporary and not raise rates again. So it goes.

Guest Post by Art Berman

Natural gas prices should double over the next year.

Over-supply plus a warm 2015-2016 winter have resulted in low gas prices. That is about to change because supply is decreasing (Figure 1).

Figure 1. EIA U.S. natural gas supply balance and forecast. Production, consumption and supply balance values are 12-month moving averages. Source: EIA and Labyrinth Consulting Services, Inc.

Total supply–dry gas production plus net imports–has been declining since October 2015^* because gas production is flat, imports are decreasing and exports are increasing. Shale gas production has stopped growing and conventional gas has been declining for the past 15 years. As a result, the supply surplus that has existed since December 2014 is disappearing and will move into deficit by November 2016 according to data in the EIA March STEO (Short Term Energy Outlook) .

During the last supply deficit from December 2012 to November 2014, Henry Hub spot prices averaged $4.05 per mmBtu. Prices averaged $1.99 per mmBtu in the first quarter of 2016 so it is reasonable that prices may double during the next period of deficit.

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Chart Of The Day: Core CPI Gains 2.3% Y/Y—–Most Since October 2008

So we have inflation rising, and we supposedly have a tremendous jobs market, as the unemployment rate is below 5% and unemployment claims are at decade lows. Shouldn’t Janet be raising rates with such numbers? Or does the government and the Fed ignore the numbers because they know it’s all bullshit? The beatings will continue until morale and the net worth improves among the establishment.

Core CPI print has not been higher since October 2008

Rent and shelter inflation soaring.

Even the lying BLS has medical services inflation at 3.9%

MOTHER, SHOULD I TRUST THE GOVERNMENT? (Oldie but Goodie)

Originally Published in June 2013

Mother, do you think they’ll drop the bomb?
Mother, do you think they’ll like this song?
Mother, do you think they’ll try to break my balls?
Ooh ah,
Mother, should I build the wall?

Mother, should I run for president?
Mother, should I trust the government?
Mother, will they put me in the firing line?
Ooh ah,
Is it just a waste of time?

Pink Floyd – Mother

The lyrics to Mother had both a literal and figurative meaning for Roger Waters. He was literally describing his overprotective single mother (his father was killed in World War II) building walls to protect him from the outside world. The figurative meaning is Big Mother sending its boys off to war and using fear to control and manipulate the masses. At the time he wrote this song in 1979, the Soviet Union was thought to be at its peak of power and the Berlin Wall represented a boundary between good and evil. Nuclear war was still a looming fear. Waters has always had a dim view of totalitarian states and institutions (English schools). Having seen his Wall Tour performance this past summer at Citizens Bank Park with a diverse crowd of 40,000, ranging in age from senior citizens to teenagers, it seems this song has gained new meaning. He sang a duet with himself from 1980 projected on the Wall and when he sang the lyric, “Mother, should I trust the government?” the entire stadium responded in unison – NO!!! This revealed a truth that is not permitted to be discussed by the corporate mainstream media acting as a mouthpiece for the ruling class. A growing legion of citizens in this country does not trust the government. This is very perceptive on their part.

In part one of this two part series – Hey You – I examined how an invisible government of wealthy, power hungry men have utilized the propaganda techniques of Edward Bernays and lured the American people into a narcissistic, techno-gadget, debt based servitude. Over the last one hundred years they have created a totalitarian state built upon egotism, material goods, and fulfilling our desires through Wall Street peddled debt and mass consumerism. It has been an incredibly effective form of control that has convinced the masses to love their servitude. The ruling oligarchs correctly chose the painless, amusement saturated, soft totalitarianism of Huxley’s Brave New World over the fearful, pain inflicting, surveillance state, house of horrors detailed in Orwell’s 1984.

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COMFORTABLY NUMB (Oldie but Goodie)

Originally published in November 2011.

Hello?
Is there anybody in there?
Just nod if you can hear me.
Is there anyone at home?
Come on, now,
I hear you’re feeling down.
Well I can ease your pain
And get you on your feet again.
Relax.
I need some information first.
Just the basic facts
Can you show me where it hurts?

Pink Floyd – Comfortably Numb

As I observe the zombie like reactions of Americans to our catastrophic economic highway to collapse, the continued plundering and pillaging of the national treasury by criminal Wall Street bankers, non-enforcement of existing laws against those who committed the largest crime in history, and reaction to young people across the country getting beaten, bludgeoned, shot with tear gas and pepper sprayed by police, I can’t help but wonder whether there is anyone home. Why are most Americans so passively accepting of these calamitous conditions? How did we become so comfortably numb? I’ve concluded Americans have chosen willful ignorance over thoughtful critical thinking due to their own intellectual laziness and overpowering mind manipulation by the elite through their propaganda emitting media machines. Some people are awaking from their trance, but the vast majority is still slumbering or fuming at erroneous perpetrators.

Both the Tea Party movement and the Occupy Wall Street movement are a reflection of the mood change in the country, which is a result of government overreach, political corruption, dysfunctional economic policies, and a financial system designed to enrich the few while defrauding the many. The common theme is anger, frustration and disillusionment with a system so badly broken it appears unfixable through the existing supposedly democratic methods. The system has been captured by an oligarchy of moneyed interests from the financial industry, mega-corporations, and military industrial complex, protected by their captured puppets in Washington DC and sustained by the propaganda peddling corporate media. The differences in political parties are meaningless as they each advocate big government solutions to all social, economic, foreign relations, and monetary issues.

There is confusion and misunderstanding regarding the culprits in this drama. It was plain to me last week when I read about a small group of concerned citizens in the next town over who decided to support the Occupy movement by holding a nightly peaceful march to protest the criminal syndicate that is Wall Street and a political system designed to protect them. My local paper asked for people’s reaction to this Constitutional exercising of freedom of speech and freedom of assembly. Here is a sampling of the comments:

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Super Bowl 50 – What Has Changed in the US Since 1967

Please note that men’s REAL median income has gone up by only 9% over the last 50 years, and that is using the blatantly fake CPI calculation. Using a true measure of inflation would reveal that men make less money today than they did in 1967. And the MSM & corrupt politicians wonder why so many people are so pissed off.

You will find more statistics at Statista

DECLINE OF THE FAMILY

The chart below captures much of what has gone wrong in this country since 1970. Households in 1970 looked entirely different than households today. In 1970, almost 71% of all households consisted of married couples. Today, only 50% of all households are occupied by married couples. The divorce rate prior to 1970 ranged between 9 and 11 per 1,000 married women. After 1970 the divorce rate skyrocketed by 100% to between 20 and 23 per 1,000 married women.

In 1970 46% of two parent households had a stay at home mom. Only 33% of mothers worked full-time in 1970. That was true because a family could live a decent middle class life on one salary. In 1970 31% of all the jobs in the country were higher paying goods production jobs. Today, only 10% of jobs are goods producing jobs. The shift from a country based upon saving and production to a services oriented nation based on debt based consumption is reflected in the chart.

The primary reason the percentage of mom’s working full time has risen from 33% to 52% is the fateful decision by Richard Nixon to close the gold window in 1971, allowing central bankers to print money, create relentless inflation (83% loss in purchasing power of USD), promoting the financialization of America by Wall Street, and encouraged politicians to promise voters goodies they can never deliver without the ability to run up the national debt without a seeming consequence.

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How The U.S. Government “Covers Up” 72% Inflation Before Your Very Eyes

Submitted by Tyler Durden on 10/23/2015 23:08 -0400

Dear Bureau of Labor Statistics: please pay careful attention to this case study of how your CPI “inflation” gauge, hedonically, seasonally-adjusted or otherwise, is completely inaccurate, and how what you record as 0% inflation is really 72%.

As Consumerist points out, for the latest example of “stealth inflation” we go to Sodastream, where as part of a redesign of its proprietary line of flavoring syrups which “cost the same” the actual bottle contents are now not only smaller but also diluted.

“How much smaller? The old version made 50 servings of flavored drink, and the new versions make only 29. Why 29? Why not 30? Such are the mysteries of the Grocery Shrink Ray.”

Consumerist shows that “the new bottles are somehow taller even though they’re smaller. On the positive side, they no longer look like petite laundry detergent bottles.”

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DEPARTMENT STORE RESULTS IMPLODING

The government issued their monthly retail sales this past week and four of the biggest department store chains in the country announced their quarterly results. The year over year retail sales increase of 2.4% is pitifully low in an economy that is supposedly in its sixth year of economic growth with a reported unemployment rate of only 5.3%. If all of these jobs have been created, why aren’t retail sales booming?

The year to date numbers are even worse than the year over year numbers. With consumer spending accounting for 70% of our GDP and real inflation running north of 5%, it’s pretty clear most Americans are experiencing a recession, despite the propaganda data circulated by the government and Fed. The only people not experiencing a recession are corporate executives enriching themselves through stock buybacks, Wall Street bankers using free Fed Bucks while rigging the the markets in their favor, politicians and government bureaucrats reaping their bribes from billionaire oligarchs, and the media toadies who dispense the Deep State approved propaganda to keep the ignorant masses dazed, confused, and endlessly distracted by Cecil the Lion, Bruce/Caitlyn Jenner, Ferguson, and blood coming out of whatever.

You won’t hear CNBC, Bloomberg, the Wall Street Journal or any corporate mainstream media outlet reference the fact retail sales growth is at the exact same levels as when recession hit in 2008 and 2001. Their job is to regurgitate the message of economic recovery and confidence in the future, despite overwhelming evidence to the contrary.

Retail sales are actually far worse than the 2.4% reported number. Excluding the subprime debt fueled auto sales, retail sales only grew by 1.3% in the last year. The automakers are practically giving vehicles away as their lots are stuffed with inventory. The length of auto loans and the average amount of auto loans are now at all-time highs. The percentage of subprime auto loans is surging to record levels, as defaults begin to rise. The percentage of vehicles being leased is also at an all-time high. To call these “auto sales” strains credibility. These people are either perpetually renting their vehicles or just driving them until the repo man shows up.

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LIES, DAMNED LIES & STATISTICS

The government released their monthly CPI report this week. Even though it came in at an annualized rate of 3.6%, they and their mouthpieces in the corporate mainstream media dutifully downplayed the uptrend. They can’t let the plebs know the truth. That might upend their economic recovery storyline and put a crimp into their artificial free money, zero interest rate, stock market rally. If they were to admit inflation is rising, the Fed would be forced to raise rates. That is unacceptable in our rigged .01% economy. There are banker bonuses, CEO stock options, corporate stock buyback earnings per share goals and captured politician elections at stake.

The corporate MSM immediately shifted the focus to the annual CPI figure of 0.1%. That’s right. Your government keepers expect you to believe the prices you pay to live your everyday life have been essentially flat in the last year. Anyone who lives in the real world, not the BLS Bizarro world of models, seasonal adjustments, hedonic adjustments, and substitution adjustments, knows this is a lie. The original concept of CPI was to measure the true cost of maintaining a constant standard of living. It should reflect your true inflation of out of pocket costs to live a daily existence in this country.

Instead, it has become a manipulated statistic using academic theories as a cover to systematically under-report the true level of inflation. The purpose has been to cut annual cost of living adjustments to Social Security and other government benefits, while over-estimating the true level of GDP. Artificially low inflation figures allow the mega-corporations who control the country to keep wage increases to workers low. Under-reporting the true level of inflation also allows the Federal Reserve to keep their discount rate far lower than it would be in an honest free market. The Wall Street banks, who own and control the Federal Reserve, are free to charge 18% on credit card balances while paying .25% to savers. The manipulation of the CPI benefits the vested interests, impoverishes the masses, and slowly but surely contributes to the destruction of our economic system.

A deep dive into Table 2 from the BLS reveals some truth and uncovers more lies. Their weighting of everyday living expenditures is warped and purposefully misleading. Let’s look at the annual increases in some food items we might consume in the course of a month, living in this empire of lies: