Profit Confidential Says Official 0.6% U.S. Inflation Data Misleading, Real Inflation Up 10% in 2015
Profit Confidential warns the official U.S. inflation data is misleading, ignoring most basic items.
New York, NY, United States – September 21, 2015 /MarketersMedia/ —
Profit Confidential (www.ProfitConfidential.com) an e-letter of Lombardi Publishing Corporation, a 29-year-old consumer publisher that has served over one million customers in 141 countries, weighs in on the most recent U.S. inflation data and warns that real inflation is running almost 10 times the official numbers.
According to the U.S. Bureau of Labor Statistics, prices in the U.S. economy increased by only 0.6% in the first seven months of 2015. A 15% decrease in energy costs over the last year and a strengthening U.S. dollar are helping keep inflation rates down. Tame inflation could complicate the Federal Reserve’s decision of whether to hike interest rates. (Source: bls.gov, data set, “Consumer Price Index – All Urban Consumers,” last accessed September 17, 2015)
“Unfortunately, government data that goes into making up the consumer price index disregards the most basic items like food and energy costs; things that really matter to the average U.S. consumer,” says economist and lead contributor Michael Lombardi. “Alternative non-government measures of inflation are telling a very different story.”
The Chapwood Index is an alternative inflation indicator that looks at the costs of items such as TV and Internet service, home repairs, laundry detergent, and school supplies in 50 different cities. The index for major cities like New York, Los Angeles, Chicago, San Jose, San Diego, and Boston says that for the trailing 12 months through to June of this year, inflation in these cities was running over 10%. The lowest inflation rate was registered for Tucson, Arizona; which was closer to six percent. (Source: chapwoodindex.com, data set, “The Real Cost of Living Index,” Last accessed September 17, 2015; http://www.chapwoodindex.com/)
“While there has been plenty written about deflation in the U.S. economy, my studies conclude that when an economy increases the amount of money in its system, prices for basic goods rise, not decline,” Lombardi adds. “For example, the M1 money supply in the U.S, this includes notes, coins, and demand deposits, has more than doubled since 2008.”
“I believe U.S. inflation is running around five percent. Sure, depressed oil prices are helping us at the gas station, but food prices and housing affordability are increasing. Rent prices are at their highest levels in years,” Lombardi concludes. “Assets like gold are proven hedges against rising prices. But gold is being ignored at this point in the economic cycle, as the U.S. dollar still reigns. Once higher prices make their way into the government figures, how long will it be before gold prices start to rise?”
Founded in 1986, Lombardi Publishing Corporation, which has served over one million customers in 141 countries, is one of the largest consumer information publishers in the world. For more information on Lombardi Publishing Corporation, visit www.lombardipublishing.com.
For more information about us, please visit http://www.profitconfidential.com/
Contact Info:
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Organization: Lombardi Publishing Corporation
Address: 350 5th Avenue, 59th Floor, New York, NY 10118
Phone: 905 856 2022
Release ID: 91769
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