http://finance.yahoo.com/news/Inflation-drops-housing-apf-13843651.html Why do they say inflation decreased instead of deflation increased. Might be scarier if they used the word deflation instead because the media loves to scare us. Or maybe they believe that most people do not know what the word deflation means?
Marketwatch is running this as their first page news that the seasonally unadjusted CPI has fallen the most since 1932. Unadjusted is completly useless, that's why they adjust it, so that they can actually make a conclusion on it! What's worse is that now the CPI is reported as front page news, NOT the core CPI. The core CPI was flat. And ho ho I thought it was core CPI that everyone looks at and only core CPI has any policy worthiness. That's practically manipulating the news, it's not a far stretch that if the reporting of these numbers is so manipulated, that the making of the numbers themselves are too. Is it bad? Yes, but volatility has been the highest EVER and commodities have been affected too. Reading about it it says transport has fallen 9.8% with almost everything else actually rising. So oil cratered and the CPI reports it, and the fear mongering lives on.
Someone forgot to forward that report to my local grocery & bakery. Hmmm, come to think of it, they have not done so EVER.
What is inflation? Inflation is the creation of money not increase in price. Increase in price is the end result. Just because companies or lower their price to generate cash doesn't mean it is deflation. It because the banks are not lending, and the only way for most companies (retails in general) is to go on sales. This is the faster way to generate cash.