Tuesday, October 18, 2005


US Inflation Jumps

Among the bevy of financial reports out this morning is this. "Data released in the U.S. today saw headline U.S. wholesale prices escalate 1.9% last month, their largest jump in 31 years."

"The increase in producer price inflation was caused by a 7.1% increase in wholesale energy prices, the largest climb in fifteen years. Notably, the producer price index for finished goods has increased 6.9% over the past twelve months, the sharpest rise in fifteen years. The ex-food and energy PPI was up +0.3%, also hotter-than-expected."

"Remarks from Fed Chairman Greenspan in Tokyo overnight reflected the current environment of accruing price pressures. Greenspan said oil costs will inhibit economic growth for 'some time to come.'"

"Other data released in the U.S. today saw August Treasury International Capital (TIC) portfolio flows print at US$ 91.3 billion, much higher than expected and above the U.S. trade gap around $59.0 billion two months ago."

Looking at the TIC report shows that 'official' or state purchases have slowed to a trickle, meaning the funds are coming from private sources; probably hedge funds.

Reading up on what the Fed calls inflation, what real or True inflation is could be staggering.

Just a guess but I bet were getting close to double digits.
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