That's YoY price changes; deflation is now here even when measured by price (the symptom thereof, not the real thing). It was already here, of course, but now we can expect to see people asking the government to find a way to keep prices from coming down (insanity...)
And in other fun, here's the first negative disposable personal income in 60 years:
(hat tip: the above from Mike Shedlock)What kind of insanity might we expect people to ask from the government now that the chips are officially down? Price supports? Consumer dept-relief? Michael Moore in the White House (now that he's made all that money going after, to paraphrase Bill Hicks, "that anticapitalism dollar -- that's a great market!")? Whatever it's gonna be, hang onto yer hat and save your pennies, because money's getting more expensive, and that'll make debt even more so.
For more cheerfulness, head to EconomPic's latest labor force graphs.
7 comments:
How does one differentiate disposable income vs. non-disposable? Is it what's left over after the bills are paid or some other price index?
God you're cheerful. Coming to this site is always a cure for a good day.
Good thing I am paying off the credit card debt QUICKLY (be done in one more month) and the student loan is almost in the bag too. Just it time for a new family member...
Thanks Mike! I consider it constructive-horror, and I use it to keep my spending within my means. :D
Alex: that's essentially it -- income remaining after fixed costs such as rent and (especially) debt payments. It's debt payments that're starting to kill folks.
Mike - I'm also within striking distance of paying off my student loans completely. Either April or May of next year. I have been lucky though in that I haven't had lingering credit card debt since 2002. Everything I do now gets paid off immediately.
One more step to solvency. Now to deal with the Mortgage...or a new car payment since my car died unexpectedly today, in traffic.
Jim - out of further curiosity how do they collect the information for the income information?
As for deflation...I know we have talked about it before but I don't see it necessarily as a bad thing. Provided of course the cost of goods decreases equally with the cost of living.
I don't know the particulars -- it's probably discussed in the bowels of the Fed's webpages somewhere. That's a good thing about the Fed, even when they use completely bullshit methods (like "hedonic adjustments"), they're pretty open about saying so if you read between the salesmanship.
Deflation is a necessary thing; it also has the potential to be a horrendous thing if it hits too hard -- every bit as bad as hyperinflation. The Great Depression was a massive deflation, for example.
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