An American

The author is an American, Christian, proud father, lucky husband, Irish Scottish heritage and a Texan by choice. I believe the U.S.A. is the greatest nation on earth, the greatest in history. Never has a nation freed or saved so many. When was there ever any nation that went to war, gave the land back, then put billions into it? I believe our core must include to take care of our young, our old, and our sick, then to do so for others in the world less fortunate than we are.

Thursday, November 16, 2006

Stock Futures Up on Good Inflation News

The inflation news this morning is outstanding. Stock futures are up sharply as a result.
The November core CPI was up just 0.1%. This was less than the expected 0.2%. The news is even better considering that the owners' equivalent rent component was up 0.4%. This is an imputed cost and is a full 23.4% of total CPI and 30.2% of the core CPI. Excluding this component to determine the price change of goods actually purchased, the core rate was flat.
The total CPI was down 0.5% due to a 7.0% drop in energy (mostly gasoline) prices. The year-over-year gain in CPI is now just 1.3%. The year-over-year increase in the core CPI dropped to 2.7% from 2.9%. That is still higher than the Fed would like, but it will drop further in the months ahead if current price trends continue.