March Consumer Prices excluding energy and food manifest fast accelerating deflation and disinflation
Sam Adelton
Apr. 15, 2007

While fuel cost and increasing gasoline prices increased the overall consumer prices quite a bit, the core inflation is manifesting disinflation and accelerating deflation.

Food and energy costs are on the rise. But the rest of the economy is slumping. Interestingly, rise in fuel and food cost are actually creating the deflation in the rest of the sector. People still resist lowering their standard of livings. But sooner or later they will give up. Then fuel, food, and the rest of the economy will fall simultaneously.

Higher inflation at the producer and consumer levels is leaving Fed policy makers with little room to lower rates should the economy slump. That is the stealth cunning economy’s tactic to force a depression. It is trying to fool the Federal Reserve. If Federal Reserve could see the deflation, they would reduce the rates as rapidly they increased it. The problem after twenty years on stagflation the central bank is trying to get rid of the self-denial. Now they agree some stagflation in the economy. After twenty years of deflation and depression they will finally agree that it is there. Unfortunately it will be too late and too little.

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