Everyone in the world has inflation except the United States. That is biggest joke that is being run by the Fed. The other central banks with the stronger currencies are worried about inflation and you have the country with the weakest currency telling everyone that inflation is contained. This is of course an excuse to keep the banks as profitable as possible when they took massive risks to supplement earnings issuing CDOs and junk mortage securities. At this rate, I don't think house prices will go down much because the dollar is bereft of value and real estate is a hard asset, although one with an oversupply. The US does have a fairly rapidly growing population and they will need to buy houses. That is your only source of inflation containment and it will go away because there are so many dollars being pumped out and floating around. First comes inflation in basic commodities like food, oil, metals. Then comes inflation in manufactured goods which use commodities as building blocks. Wage inflation is the next step as companies charge more for their goods and employees demand wage increases especially with record profit margins for US companies. Health care and tuition costs are through the roof. Inflation at 2.1% is laughable. Its a running joke to try and fool the masses and get their inflation expectations down. Remember, don't believe the masses. Inflation is not bad for stocks when the Fed denies its existence. That is a nirvana like environment for stocks, easy money and low rates in a high inflationary economy.
Wait till China export their inflation at 7% per year to US. At that point, CPI is not going to save Ben. That could be next quarter, then what will Ben do. Inflation + no growth + weak dollar at the same time! lol
I'm sure the government will find some way to use their hedonic pricing magic on the CPI to say that inflation has bumped up, but just by 2/10ths of a percent. LOL. Running joke at Capital hill.
Maybe this has been asked and answered before but seeing Bernanke today and looking back at his tenure so far I can't help but wonder if the next president has the power to fire him? Seriously, if he is doing this badly 2 years into his term can they give him an early severance and send him on his way in 2009? Two more years of this is too much. The dollar will be worthless by the time he is done. That is all.
Gold @ 967.50 and the fed says not worried about inflation. Don't listen to these clowns listen to the market, it's shouting from the roof tops inflation is here.