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<< Taxes on Wealthy Help Employment | Main | Competing Auto Unions >> April 15, 2004Return of InflationRemember inflation? You know, that phenomena where increase in wages doesn't get you an increase in lifestyle, since all the prices are increasing. It's back! A lot of folks were excited a couple of days ago when retail sales jumped 1.8% in March-- a large number that gave hope of massive growth for the year. But that's the raw growth number. So yesterday the inflation numbers for March were released. Consumer prices were up 0.5%- meaning that a significant chunk of the retail sales increase was just inflation. And as I've noted here and here, even these numbers are likely understating inflation. So don't buy the hype on the soaring economy. Friends who still are having trouble finding jobs is still a good indicator of serious problems in the economy. Posted by Nathan at April 15, 2004 07:21 AM Related posts:
Trackback PingsTrackBack URL for this entry: CommentsBut should't moderate inflation be regarded as a good thing, as it indicates the presence of growing demand and thus incentives to investment and increased employment? On the other hand, I am not entirely convinced that the specter of world-wide overcapacity and deflationary pressure has evaporated and relative devaluation of the U.S. economy would be expressed in domestic inflation. (Note that the increase in the $ price of oil is not reflected in an increase in the Euro price.) At any rate, nominal prices are never a transparent window into what is going on in the real economy. Posted by: john c. halasz at April 15, 2004 05:23 PM Don't forget about security. Secureroot.org Posted by: Randall at July 6, 2004 08:51 AM Post a comment
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