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Changes in everyday prices—the prices that people pay for the goods and services they purchase frequently—can differ dramatically from price changes shown in the Consumer Price Index, which is published monthly by the Bureau of Labor Statistics and widely reported. The CPI is a broad index, covering all goods and services purchased by urban consumers. But some prices are more important to people’s everyday lives than others. People may rightly feel that their “personal inflation” is not reflected in the CPI numbers.
READ MOREFor many women, domestic violence is often associated with economic instability. In some cases, economic dependency is a tool of the abuser, and abused women are forbidden to spend money or make financial decisions or are shamed when they do. Yet leaving an abusive relationship can also expose a woman to financial hardship. Besides losing a home, survivors of domestic violence often do not have their own bank account, credit in their own name, or knowledge of how the financial system works.
READ MOREAIER’s Everyday Price Index (EPI) was unchanged in July after increasing 0.8 percent in June.
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As the recovery enters its seventh year, revised data reveal slower progress than previously estimated. Overview The Economy… While the latest data confirmed our reading at the start of the year that economic weakness was temporary, and despite accelerating growth in the second quarter, the more complete and detailed information released last month show that the recovery since 2012 has been slower than previously reported. Today’s GDP value is almost one percentage point lower than earlier estimates led us to believe. This means the current business-cycle expansion, whether measured by output or employment growth, has been the slowest in U.S. postwar history. …Inflation… Strong CPI growth in June underlined AIER’s analysis last month pointing to rising inflationary pressures. The latest scorecard shows that 17 out of 23 indicators support rising inflationary pressure, compared with 15 in our previous report, indicating a higher likelihood of future price increases. Anticipated policy firming on interest rates may moderate rising inflationary pressures. …Policy… Fed policy makers did not provide any new signals on the timing of an increase in short-term interest rates following their July meeting. and despite the weaknesses highlighted in the revised report, the Fed continues to indicate that its policy remains on track for a liftoff this year. …Investing With still-modest growth and inflation, bond yields remain very low. However, a slowly improving U.S. economy and declining unemployment may support the Fed’s first rate hike in almost a decade. That, in turn, may pressure bond yields higher, but the question of how high yields may rise remains open. Weak global growth and a strong dollar have sent most commodity prices tumbling to multi-year lows. Add to that a price war in crude oil and the decline in demand for gold as a haven and the environment for commodities remains unfavorable. Equities around the world have done reasonably well this year—valuations are rising in many markets. Critical to continued price gains will be better economic growth helping drive future earnings.
READ MOREhttps://www.youtube.com/watch?v=LE68l39X_qg
READ MOREWorkers who are saving for retirement through IRAs and 401(k)s probably have been asked about asset allocation—how much they want to invest in stocks, bonds, or other investments, and the level of risk they are willing to tolerate with their retirement savings. Those who are already in retirement face a new challenge: how to allocate their investments to generate the income they will need for the rest of their life.
READ MOREhttps://www.youtube.com/watch?v=7WQNQrk3yXY
READ MOREThe Everyday Price Index (EPI) increased 0.8 percent in June after increasing 1.1 percent in May.
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As the Fed looks for employment improvements to support a liftoff in rates, we assess the labor market’s condition. Overview The Economy… While some U.S. labor market measures are at record levels following six years of expansion, others hold room for improvement compared with past performance in previous recoveries. Our view is that the economy remains resilient, growth is reaccelerating from a temporary first-quarter weakness, and the likelihood of recession in the next six to 12 months remains low. …Inflation… AIER’s inflationary pressures scorecard suggests an increase in May as 15 of 23 indicators showed rising pressure compared with six that displayed declines, suggesting that prices may rise in coming months. Among CPI components, energy climbed at a fast pace in May, contributing to strong growth in the index, while food prices stayed unchanged. In the labor market, more jobs were created, but productivity growth slowed and labor costs rose, putting upward pressure on inflation. Stubbornly high rates of underemployment and discouraged workers are areas showing room for further improvement in a market closely watched by Fed policy makers poised to raise short-term rates for the first time in nine years. …Policy… First-quarter weakness, though seen as temporary, led to scaled-back growth projections from the Fed in June. While policy makers left short-term rates unchanged at their June meeting, a majority of FOMC members expect an increase later this year rather than a delayed take-off in 2016. At the same time, they expect the pace of normalizing policy to be slower than previously anticipated. Employment and incomes are not expanding as robustly in this recovery as both did in earlier cycles. As long as uncertainty in jobs and earnings persists for large parts of the population, political attitudes are likely to favor protectionist tendencies in trade, immigration, and on other issues. …Investing Federal budget deficits remain large by historical measures but have narrowed substantially in recent years, curbing the Treasury’s need to issue new debt. Combined with ongoing geo-political risks and uncertainty, the resulting reduction in issuance could partly offset the negative effects of anticipated rate hikes. In the world of precious metals, gold prices have outperformed silver by a wide margin in recent years, suggesting that silver will be the better performer in coming years, based on historical patterns. Further improvement in labor markets should begin to push compensation costs higher, supporting consumer spending but also potentially squeezing corporate profits. Companies will need to either pass along higher costs, boost productivity, or both, to maintain earnings growth. Globally, market performance has been quite divergent. U.S. equities have performed admirably, particularly compared with developed markets. Greece and China had roughly similar histories until the Great Recession. Since then, Greek shares have languished while Chinese indexes have posted large gains, only to suffer recent sharp declines.
READ MOREDo changes in the economy affect the stock and bond markets? From day to day, fluctuating prices in the financial markets are of great interest for high-frequency traders. But daily market movement is so volatile that economists call it a “random walk” whose next steps are unpredictable. To date, no clear pattern of daily movement has been found by researchers.
READ MOREThe Everyday Price Index (EPI) increased 1.1 percent in May after showing no change in April. On a not-seasonally-adjusted basis, the CPI increased 0.5 percent in May after rising 0.2 percent in April. AIER’s EPI is not seasonally adjusted.
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