Inflation as measured by the Federal Reserve's preferred price index surged in the second quarter to the highest annual rate in three years.
The Personal Consumption Expenditure index (PCE) rose at a 2.3% annual rate in the April-to-June period, compared to 1.4% in the first quarter. The so-called core PCE that excludes food and energy climbed at a 2% clip, up from 1.2%.
The PCE is a measure of price changes in consumer goods and services. Personal consumption expenditures consist of the actual and imputed expenditures of households; the measure includes data pertaining to durables, non-durables and services. It is essentially a measure of goods and services targeted toward individuals and consumed by individuals.
I wonder if Krugman still thinks deflation is the concern.
In the EPJ Daily Alert, I am warning that price inflation is likely to accelerate much quicker than most expect. I also warn that the Fed, despite their supposed price inflation "target" of 2.0%, really has a target of 3.0% and that they will be very slow to respond the inflation. Their actions will be too little, too slow.
-RW
Considering prices would be falling, not rising, without the Fed, and the phony numbers they use, it's bad. Really bad. Rrreeeeealllly bad.
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