With oil below $50 and sales everywhere, economists seek solutions
Washington Post Nov 21, 08 9:18 AM CST
(Newser)
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Lower prices may sound like a good thing, but economists say sustained deflation poses a serious threat to any turnaround, the Washington Post reports. Consumer prices are tanking on everything from clothes to steel, which feeds a cycle: People stop buying as they hold out for better sales, and stores keeping cutting prices, then jobs. One economist expects the Fed to cut rates in an attempt to stem "dire circumstances, which are rapidly unfolding right at this time."
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MARKETS
Bad news in housing and predictions of recession sour stocks
Wall Street Journal Nov 19, 08 3:21 PM CST
(Newser)
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Stocks plunged today on a spread of bad economic news, including signs that the housing market is not improving and dire predictions by the Federal Reserve’s interest-rate committee, the Wall Street Journal reports. The Dow fell 427.47 to close at 7,997.28. The Nasdaq lost 96.85, settling at 1,386.42, while the S&P 500 shed 52.54 to close at 806.58.
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Oil's record decline leads to 1% overall drop
Associated Press Nov 19, 08 9:07 AM CST
(AP)
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Consumer prices in the United States plunged by the largest amount in the past 61 years in October as gasoline prices dropped by a record amount. The Labor Department said today that consumer prices fell by 1% last month, the biggest one-month decline on records that go back to February 1947. The drop was twice as large as the 0.5% decline analysts expected.
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Falling prices
could trigger long
downward spiral
New York Times Nov 1, 08 5:11 AM CDT
(Newser)
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Fears of runaway inflation have been replaced by fears of its opposite as the world's economy starts seizing up, the New York Times reports. Economists see a potentially devastating deflation ahead as cash-strapped consumers create a glut of underpriced, unpurchased goods and services—in turn triggering mass layoffs at struggling companies and sending the US economy into a tailspin that will be tough to halt.
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But higher Europe wages drive up prices
Wall Street Journal Aug 22, 08 10:20 AM CDT
(Newser)
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Workers in the US are falling behind inflation while their counterparts in the 15-nation Eurozone are keeping pace, in part because of more powerful unions, the Wall Street Journal reports. But rising wages may damage the European economies, as they deter companies from hiring and in turn boost inflation. When wages are indexed to prices, an inflationary spiral is particularly hard to break, the paper observes.
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High energy, motor vehicle costs pushing inflation; Fed may be forced to boost rates
Associated Press Aug 19, 08 10:25 AM CDT
(AP)
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Wholesale prices jumped 1.2% in July—more than twice the rate economists expected and the fastest pace in 27 years, according to government data released today, the AP reports. Core prices, which exclude food and energy, rose 0.7%, the biggest since November 2006; new home construction in July fell to the lowest pace in more than 17 years.
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Economy
Associated Press Aug 14, 08 9:07 AM CDT
(AP)
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US consumer prices shot up 0.8% in July, twice the expected rate, pushed higher by surging energy and food costs, the AP reports. The spike left inflation running at 5.6%, the fastest pace in 17 years, the Labor Department reported today. It marked the third straight month of soaring prices, following jumps of 0.6% in May and 1.1% in June.
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Economy
Consumer prices up 1.1%; wholesale up 1.8%.
Bloomberg Jul 16, 08 9:35 AM CDT
(Newser)
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Consumer prices rose a staggering 1.1% in June, Bloomberg reports. The figure far surpassed analyst estimates, and brings the year-over-year figure to 5%–the biggest surge since 1991. Core inflation, which excludes food and energy, rose a more-than-expected 0.3%. “Inflation has galloped,” one economist said. “It puts the Fed in a really tricky position. I don't see how they can change rates this year.”
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Switch to cheaper goods is broadest
since early '80s
Wall Street Journal Jul 11, 08 12:26 PM CDT
(Newser)
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As fuel prices and home foreclosures steadily rise, Americans are trading down in everything from automobiles to their lunch options. That's not unusual in an economic downturn, but the speed with which it's happening is, the Wall Street Journal reports. And the flight to the affordable and generic is affecting the broadest array of goods since the recession of the early 1980s.
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Higher food prices not having diminishing effect of gas costs
Reuters May 21, 08 5:33 PM CDT
(Newser)
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Many Americans are cutting back on gas due to spiking prices, but few are eating less in response to similarly soaring food costs, a poll finds. Nearly half of respondents said they were driving less, but only 8% said they were eating less. "People have more control over gasoline. They are driving less and driving smarter," pollster John Zogby tells Reuters.
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MARKETS
Consumer-price data better than expected
Wall Street Journal May 14, 08 3:38 PM CDT
(Newser)
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Stocks were up today on consumer price data showing lower-than expected inflation and on declining oil prices. A Labor Department report showed the CPI rose only 0.2% in April, reports the Wall Street Journal . The Dow ended up 65.71 to 12,897.89, the Nasdaq rose 1.58 to 2,496.70, and the S&P rose 5.56 to 1,408.6.
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Fed's actions key strong economic reports, signs of market recovery
Wall Street Journal May 14, 08 9:50 AM CDT
(Newser)
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A growing number of economists are saying, cautiously, that the US might have pulled back from the brink of recession, the Wall Street Journal reports. The experts credit swift action by the Federal Reserve to lower interest rates and save Bear Stearns in March, and even the ongoing distribution of fiscal-stimulus checks, as catalysts for the detour.
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Environmental concerns put 10% quota on hold
Guardian (UK) Apr 19, 08 2:42 PM CDT
(Newser)
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The European commission is backing off a proposed 10% biofuels quota as scientists warn that the alternative fuels actually hurt the environment, the Guardian reports. “This is all very sensitive and fast-moving,” said a commission official. “There is now a lot of new evidence on biofuels, and the commission has become a prisoner of this process.”
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