Reply #10: Actually. No. Not at all./ [View All]

[Frodo]

They were YOUR comments. The article does not say "stagflation". You can also not ignore that this is not the only thread you posted re: this article. Your comments on the other thread leave no wiggle room that you are merely the messenger.

"Inflation Skyrockets As Jobs Fall" -- latest economic release"
Did the report say that? No.

"First firm evidence of STAGFLATION!!!!" I must have missed that in the link.

"Profit margins go AND jobs go!" Even though the economic release said the opposite


Higher prices could also translate to increased profits for suppliers. This is not uncommon when production is ramped up - manufacturers are not the only ones who get to make money. Notice that the increased number has a POSITIVE effect on the ISM index. And treasury securities went UP on the news. If they saw rampant inflation they would be tanking.


Sure, people "SHOULD be panicked in an economy where the prices of all kinds of necessities are rising" assuming the increase is substantial, but that is not the case. There is some speculation that the CPI is understating the rate of "true" inflation, but even if it's off by a factor of two we're still looking at very modest inflation numbers (right in line with the last decade - certainly not stagflation). And it's NOT off by THAT much. Other measures of inflation have come in very close to the CPI number.

In short, and to repeat, you cannot take a tiny portion of what add us to total inflation and extrapolate it as you did (and no, the article did not). You can't stay at a Motel6 for $40 and say "that was only $36 last week! That's more than 10% inflation in a week! We're going to look like Argentina! Run for your lives!"


On edit - in response to your edit. Yes, Computer prices falling does help to hold down the overall rate of inflation (is therefore "deflationary"), but notice that as one COMPONENT in the equation it does not indicate deflation in the overall economy, merely that one piece of it. Similarly, that component of manufactured goods does not imply excess inflation overall.