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Business Title: U.S. Consumer Prices Excluding Food, Fuel Record Smallest Gain on Record Nov. 17 (Bloomberg) -- The cost of living in the U.S. rose less than forecast in October, indicating higher prices for commodities such as fuel aren’t filtering through into other goods and services. The consumer-price index increased 0.2 percent after a 0.1 percent rise the prior month, the Labor Department said today in Washington. A 0.3 percent gain was forecast by economists, according to the median projection in a Bloomberg News survey. Excluding food and fuel, so-called core costs increased 0.6 percent from October 2009, the smallest gain on record. Retailers such as J.C. Penney Co. are preparing to use discounts to lure shoppers during the holiday season as a stagnant labor market restrains demand. The core consumer-price figures help validate the Federal Reserve’s decision for a second round of unconventional monetary easing aimed at preventing deflation, or a prolonged drop in prices. “There is no indication of inflation pressure,” said Chris Low, chief economist at FTN Financial in New York. “Given the criticism the Fed has taken recently, especially over the potentially inflationary aspects, it’s very market friendly in that it should help push back against some of that criticism.” Estimates in the Bloomberg survey of 80 economists for the overall CPI ranged from gains of 0.1 percent to 0.8 percent. In the 12 months ended in October, prices increased 1.2 percent. The core rate was unchanged for a third straight month and restrained by cheaper vehicles, clothing and tobacco. The median forecast in the survey called for a 0.1 percent gain. The year- over-year gain was the lowest in the history of the index, which dates to 1957. Housing Starts Fall Builders in the U.S. began work on fewer homes than forecast in October as the industry remained mired near the depths reached during the recession. Housing starts fell 12 percent to a 519,000 annual rate, the fewest since a record low reached in April 2009, Commerce Department figures showed today. Work on multifamily units, which is often volatile, plunged 44 percent, while single-family construction dropped 1.1 percent. Stock-index futures held gains after the reports and Treasury securities rose. Futures on the Standard & Poor’s 500 Index increased 0.2 percent to 1,177.2 at 8:49 a.m. in New York. The yield on the 10-year Treasury note, which moves inversely to prices, dropped to 2.83 percent from 2.84 percent late yesterday. Energy prices increased 2.6 percent from a month earlier, reflecting gains in the costs of gasoline and fuel oil. Food prices rose 0.1 percent in October. Effect of Housing Meantime, the struggling housing market is restraining the consumer price index. Rents, which account for about 40 percent of core consumer prices, have been held in check as foreclosures push more houses into the rental market. Owners-equivalent rent, one of the categories designed to track rental prices, rose 0.1 percent after no change in the prior two months. Compared with October 2009, owners-equivalent rent was unchanged. The cost of medical care increased 0.1 percent in October. New-car prices declined 0.2 percent, while used-vehicle costs were down 0.9 percent. Tobacco prices fell 0.3 percent, the most since May 2009. Apparel costs fell 0.3 percent in October and were down 1.2 percent from the same month last year. Dick’s Sporting Goods Inc. said it’s not seeing any price pressures from its suppliers. No Inflation Pressure “We’re not seeing anything significant from an inflation standpoint,” Edward Stack, chief executive officer of Dick’s Sporting Goods, said during a teleconference yesterday. “We’re now in the process of starting to buy into the third and fourth quarter of next year and we haven’t seen any pressure that makes us uncomfortable.” The ongoing slump in housing, unemployment near 10 percent and risk of sustained declines in prices are reasons why the Fed on Nov. 3 announced it would buy up to $600 billion in Treasuries through June. “You don’t want inflation to be too high but you also don’t want it to be too low,” Fed Chairman Ben S. Bernanke said in a speech on Nov. 6. “Our purpose is to provide additional stimulus to help the economy recover and to avoid potentially additional disinflation, which I think we all agree would be a worse outcome.” Holiday Discounting Retailers are again turning to discounts to encourage consumers this holiday season. J.C. Penney, the third-largest U.S. department-store company, last week said third-quarter profit rose 63 percent. Fourth-quarter sales at stores open at least a year will rise 3 percent to 4 percent, the Plano, Texas-based company said in a Nov. 12 statement, adding that the holiday shopping environment will “remain highly promotional.” “Many retailers have characterized their inventory levels as high, particularly after October, which could mean a period of greater promotion and mark-down in the fourth quarter,” Bill McComb, the chief executive officer of Liz Claiborne Inc., designer and marketer of brands including Kate Spade, said on a Nov. 4 earnings conference call.
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#1. To: Brian S (#0)
With 50 Million Food Insecure and 59 Million Uninsured, No Wonder Dems Lost By: emptywheel Monday November 15, 2010 8:29 am TweetTweet Share digg stumbleupon In the last week or so, two public reports have cataloged the growing insecurity of Americans. Last week, CDC reported that the number of people without health insurance topped 59 million in the first quarter of this year (up 400,000 from last year and 2.7 million from 2008). And today, USDA reported that 50.2 million were food insecure in 2009 (up 900,000 from the previous year, though it does say the increase may have been due to statistical sampling). A sixth of this country doesn’t have the bare necessities. A tenth of this country don’t have jobs. Is it any wonder that Dems lost two weeks ago?
Jeff Kaye November 15th, 2010 at 8:51 am 2 Moreover, they showed almost no sense of the desperation growing in the country. The “tell” was their refusal to do anything meaningful about jobs, or help people and not hurt them with their mortgage “reforms” (great job you’ve done reporting that, EW). God, those Rape-scan machines have to go. We’re canceling plans for our vacation because we don’t want to fly and take a chance our daughter would get felt-up by some TSA creep. Telling people they have to be sexually molested for their safety is the height of Orwellian madness. I think a strong case can be made that each of these paradigms.... www.oftwominds.com/blogno...aradigms-broken11-10.html ....is either already broken or in danger of breaking. Studies have shown that when presented with factual evidence that their core beliefs are wrong, humans respond by clinging even more tightly to their fallacious beliefs. I think that is precisely the reaction of the global Status Quo.
(eyes rolling)
Obama's first all-by-his-lonesome budget, btw, calls for a $1.17 trillion deficit.
(eyes rolling) Mine too.
Never swear "allegiance" to anything other than the 'right to change your mind'!
You know that means the locust can't be far behind....(grin)
Obama's first all-by-his-lonesome budget, btw, calls for a $1.17 trillion deficit.
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