Tuesday, February 14, 2017

Producer Prices Unexpedly Rise

The PPI for January reported a +0.6% increase for the month. While only one month if annualized it is near 8%.  It also follows a trend of accelerating inflation.  Consumer grumbles of headline inflation not matching their experience at the store are once again in vogue.  More with hopefully CR style graphs a bit later.


71 comments:

LBD said...

First!

Rob Dawg said...

Ahh but in the big picture is being first to an inflation thread a good thing? There are a lot of bonds and notes maturing this year. The deficit is still very high. The Fed promises multiple rate increases. Labor seems to be getting better and H1b reform will provide a symbolic boost. I am definitely moving away from bonds.

Mike said...

Would love to see mortgage rates pop up over the next couple months..(I'm going to be condo hunting w cash towards the end of the summer)...

Mike said...

re inflation..the only thing I have to say is..the price of (good) beer is too damn high... :<)

LBD said...

Food, property taxes, insurance, Eating out, cars, etc have gone up substantially over the past 10 years. No realistic SS increase plus robbing savers is inflationary. How much a month crowd has been loving this subsidized financing. LOL!

Mike said...

yeah..I've really noticed the increases at the restaurants up here in the past year or two. We rarely go out without a Groupon deal any more...

Lawyerliz said...

Not until the son closes on his house. But I do thonk he's locked in.

Lawyerliz said...

Think

Rob Dawg said...

Wait... You are so rich you can eat out without a Groupon? Ohhhh... royalty visits.

Lawyerliz said...

Insuance--well this is Florida, where they would like to charge an infinite amount. Taxes on home steady can go up only 3% a year. Restaurant food has gone up significantly. Clothes, no.

Mike said...

Tell him to get locked..we might see two or three rate hikes this year out of the Fed...

Lawyerliz said...

At 3.7%. He assure me it is 30 years.

Mike said...

3.7%?? that's 50 bps lower than out here..how many points??

LBD said...

The Rich know how to buy wholesale. The wannabees want to look rich and pay retail!

Mike said...

maybe he's FHA..those look to be in the 3.7% range right now (anybody know why those are so much cheaper than a conventional 30y?? do they get you somewhere else in the transaction??

Mike said...

The Rich know how to buy wholesale.

a buck saved is a buck fifty earned... ;<)

Mike said...

Whatever Yellen is saying this morning to Congress..bank stocks/financials sure seem to like it...

LBD said...

Going to Applebees today, they have hamburger, fries and Pepsi deal!

Lawyerliz said...

Dunno

Lawyerliz said...

VA I think

Lawyerliz said...

Pepsi. Ugh.

Lawyerliz said...

How much in,assets do you need to be minimally rich?
1 mil? 1.5? 2?

Rob Dawg said...

The Applebee's here has any burger, fries and Pepsi for $9.99. That's not bad considering their bigger gut busting burgers are $7-8 alone and worth it.

Still, the UC "tuition" increase pretty much doubles my personal inflation. Actually that's a good idea. When I get the time I'll put up a "personal inflation calculator" so people can put in their exposure to everyday prices. Rather than the government "typical" consumer number a personal number. No private data necessary. Just questions like Do you pay tuition? Lots of salads? Gasoline monthly expenses. That stuff. I've been busy in the real world but that can change as fast as it happened.

Mike said...

How much in,assets do you need to be minimally rich?

"Rich" ??

I would say $5 million (not including RE you live in)...

and by "rich"..I'm thinking like you can take off on a three week Hawaiian vacation on short notice without worrying about prices too much...

Rob Dawg said...

Rich:
Healthy, happy, hopeful and able to sleep peacefully.

Wealthy:
So much money that you mistake wealth for a substitute for the aforementioned.

Poor:
Unhappy living within your present means.

But no credit to me. Recall this:

Mr Micawber's famous, and oft-quoted, recipe for happiness:

"Annual income twenty pounds, annual expenditure nineteen [pounds] nineteen [shillings] and six [pence], result happiness. Annual income twenty pounds, annual expenditure twenty pounds ought and six, result misery."

~ Charles Dickens, David Copperfield

-----

And to think you hated that book like I did. ;)

Lawyerliz said...

Excellent idea.

Lawyerliz said...

Haha

Mike said...

yeah there's "asset rich" and then there's "cash flow rich"..both are good..the latter is better.. ;<)

and whether either translates into personal happiness is an entirely different subject...

Lawyerliz said...

I could do that and we don't have any 5m $. But we have no debts, either. Except the previous months credit card bills, which we nearly always pay off in full. It kills the hub to pay even 20$ in interest.

Mike said...

Still, the UC "tuition" increase pretty much doubles my personal inflation.

any reason to have a cut-off for kids at age 30 (or so)...

Mike said...

I could do that and we don't have any 5m $.

so you are "cash flow wealthy"..congrats!!

Mike said...

any reason

should have been "another reason"

Mike said...

another definition of "rich"...

If you go directly to the Four Seasons website instead of Travelocity..you're probably rich....hahahahaha

Rob Dawg said...

For the record. I have not been to the Four Seasons for several weeks. I was there less than a dozen times last year.

Okay, more. We have a UCLA sponsored wine club subscription that provides free sample wine flights at the bar in the Thousand Oaks Four Seasons.

Mike said...

just checked the Four Seasons Maui for you Liz...Friday 17th thru March 10th (3 weeks) is only $1300..per night!!

pack your bags!!

Mike said...

For the record. I have not been to the Four Seasons for several weeks.

I usually can't get past the gates in my ten year old Camry.. ;<)

Lawyerliz said...

Yep. People who do need a lot of money or who need to lose a lot pof weight, think that if they get those things they will be happy, but they find that the problems resulting from being poor and fat go away, but none of the other problems go away. Often, this surprises them.

Lawyerliz said...

Dickenson and his wife were spendthrifts, so having more money wasn't all that helpful.

Rob Dawg said...

To be honest. Waliking onto the lobby requires walking past the circle of vehicles near the grand entrance. Since I have to pass the valet parking in the structure I can tell you that 1/2 million vehicle is no assurance of getting a spot out front. A $350k Bentley will get usually a spot but couple year old Lamo often does not.

Mike said...

Hearst Castle is the opposite end of the spectrum..extremely wealthy guy who obviously had no problem with excessive "spendthriftiness"...

not sure how "happy' he was either..

Lawyerliz said...

Hey, it wasn't specified that I stay at the 4 Seasons!! I are there once in Boston 15 or 20 years ago. I don't think there is even a 4 Seasons in the south half of Florida. If there is, I'm sure you all will enlighten me.

Lawyerliz said...

Ate

Lawyerliz said...

Why would you want a 350k $ bentley?

Mike said...

it wasn't specified that I stay at the 4 Seasons!!

what were you thinking..Travelodge?? lol

that's only $600 per night..

Lawyerliz said...

What's a wine flight? I guess I'm too ignorant to know Im poor.

Lawyerliz said...

That's more like it.

Mike said...

ok..gotta run some errands before the monsoons hit tomorrow..

catch you all later..

Rob Dawg said...

Liz, you are one of the richer people i know including a lifelong friend who owns a lot of Upper New York State.

What's a wine flight? I guess I'm too ignorant to know Im poor.

It's a "wine" thing. They give you a taste of 4 or 6 wines all at once in a carrier. Two ounces or or a bit less. A taste and a swish.

This is a social event not a bar drink. Fun. We did this in college and later when we moved here. Buy 2 bottles each of 5 or more different wines. Hold a party and pass out samples. A great way to socialize. Oh, and I can tell you we often opened a cheap bottle in the kitchen only to pour it all down the drain. No big loss in the greater picture.

Lawyerliz said...

Oh. I thought they were flying you to the 4 seasons.

Rob Dawg said...

The number of times i have been flown for the benefit of others is a very short list. Remember in 2007 when Bill McBride was invited to meet Obama? I wasn't.

Lawyerliz said...

I only recently learned what a silent auction was. Friend dragged me to a society charity gala. YAWN. Lots of 2nd wives, and no interesting conversation covered by music which was too loud.

Lawyerliz said...

He was? I didn't know that. Are you jealous? I wouldn't be. Geesh, when I want to get a word in edgewise it have t I stand there with my hands cross in the t for time gesture. Or, interrupt, which gets me reproached. Why I like posting. I can get my say in. And I don't know if you are really listening or not!!

Lawyerliz said...

I didnt want anything from the silent auction either.

Lawyerliz said...

One of the very beautiful second wives was from some country like Melania. But her husband was quite handsome, unlike you know who, and seemed nice.

Lawyerliz said...

Trump is keeping a close eye on Oroville. Whaft a relief!! /snark/

Elizabeth Merceret said...

I think interest rates will be increased only once this upyear.

LBD said...

Rich, That is the guy with 5 bucks more then you. Seriously if you live the lifestyle your happy with, owe no one and have paying assets, no job, then I would say your rich.

Lawyerliz said...

Ok, how rich is too rich. Watched this thing on Warren Buffett. He is, I think, too rich. And we are misled into admiring what I'd call essentially a one- trick pony. Yeah, he started that foundation. But does he and Gates actually involve themselves into what it does?

Lawyerliz said...

Ok, how rich is too rich. Watched this thing on Warren Buffett. He is, I think, too rich. And we are misled into admiring what I'd call essentially a one- trick pony. Yeah, he started that foundation. But does he and Gates actually involve themselves into what it does?

LBD said...

Buffet plays both sides of the street. He is Ego driven to win and it is a game more then greed. Gates Probably suffers the same. That is why every one has their own idea of whats rich.

Lawyerliz said...

He looks so damned benevolent. Seems like doing the same thing over and over should simply be boring. Instead of worrying about africa, why not share the productivity by giving all the america.n employees really big bonuses, especially the ones on the middle to bottom.

Lawyerliz said...

But he might lose some personal power that way.

Lawyerliz said...

Hey, why don't Gates a ng d Buffets pick a couple of really bad dams and bridges and just pay to fix them?

LBD said...

Good Morning!

Buffet thinks the rich should pay more taxes but I bet he doesn't. He could even donate to the government. Claims he is giving his fortune to charity as the government is so inefficient it would be squandered. Gates is a look alike buddy. I have never seen a buffet funded charity or public project here in Nebraska. Strange person to me.

Lawyerliz said...

And

Lawyerliz said...

So he could supervise it himself or hire someone he trusts to do it. I think he's creepy. What value did he ever add? What thing did he ever invent what new inventor did he ever fostorthrough the painful initial stages. He is a bad example to us money fascinated americans.

LBD said...

Buffet and Gates added the value of vision and leadership. How many jobs and opportunity have both provided. One could make the case as to where would we be with out their leadership? Buffet being thrifty has probably piled his money back into investing crating and saving many more good paying jobs.

Lawyerliz said...

Gates did. Not sure about Buffett. He bought Coke, among others. Which is harmful to your body, with all the sugar. I doubt if he spent even one minute thinking about that. I doubt if he created any Coke jobs. Or increased any janitors salaries to a livable wage. I will be very happy to be shown wrong.

Rob Dawg said...

Buffett pulled off what the devil never managed. He convinced people he didn't exist. Good ole' Unca Warren. "I don't invest in what I don't understand." Bunk, he has and continues to use sophisticated investment instruments.

More apologies. I have just gotten real busy all of a sudden. Your patience is appreciated.

Lawyerliz said...

I eagerly await the next post. Read a blurb on Kali's lack of a requirement of earthquak e insurance which throws earthquake costs to the rest of the country. Seems like Fanny and Freddie should require at least half the cost to be paid the borrower. How much is 400k worth of earthquake insurance anyway?

Lawyerliz said...

I looked it up. Premiums about 800$ to 5k. The lower anoint is doable but the deduction is 15%, which is greater than most losses. How said he wouldn't be interested bUT would be interested in saving, say 3k per year towards repairs. Of course nobody saves money.