Your Place in Cyber Space for Inflation Data
Inflation affects every consumer, business person and investor in some way or other. Inflation is one of the key factors that affect consumer prices, financial markets including Stocks, Bonds and Forex. As such, it is important for consumers, investors and traders to get a deeper understanding of what is inflation and what causes it. What is Inflation? Understanding inflation is often complicated by the fact that the cause and the effect are often muddled together in people's minds due to the … [Read More...]
This month we have updated the Crude Oil Inflation Chart which shows historical crude oil prices and also what they would be if you adjusted them for inflation as of February 2019. We have also updated the Annual Crude Oil Prices Table and the Monthly Crude Oil Prices Table both of which also show prices adjusted for inflation. The nominal price of a barrel of oil was only $1.37 back in 1946 but the inflation adjusted price of oil was $18.92 per barrel. (The nominal price is the price you would have actually paid at the time). The major peaks occurred in December 1979, October 1990, and June 2008 at $125.23, $65.68, and $145.93 respectively (all inflation adjusted to 2019 dollars). Another interesting item to note is that the inflation adjusted average price has been increasing. The average for the entire period from 1946 to present is $44.75 but the average since 1980 is $55.99 and the the average since 2000 is $64.66. This may be the result of increased extraction costs as it becomes harder to find and requires much greater technology to get to it.
The red line on the chart shows Illinois Sweet Crude oil prices adjusted for inflation in February 2019 dollars. The black line indicates the nominal price (in other words the price you would have actually paid at the time). Current prices as of February 28th 2017 are $50.25 down significantly from recent highs but up from 2016 lows.
The U.S. Bureau of Labor Statistics (BLS) released their monthly Consumer Price Index report on March 12th 2019, for the 12 months through February 2019.Annual Inflation is Down (Slightly). Annual inflation in February was down very slightly from January’s 1.55% to 1.52%February’s CPI was 252.776 January’s CPI was 251.712 up from December’s CPI of 251.233, November was 252.038Monthly Inflation for February was 0.42%, slightly below last February’s 0.45%. December was -0.32%, November was -0.33%.Next release April 10thWe’ve added another bar to the Annual Inflation Rate Chart indicating Quantitative Tightening (QT) check it out here.
The U.S. Bureau of Labor Statistics (BLS) released their monthly Consumer Price Index report on February 13th 2019, for the 12 months through January 2019.
In 2009, the FED used every trick in the book to combat the contraction of the money supply including lowering interest rates to near zero and when that wasn’t enough it began buying assets through its “quantitative easing” (QE) programs. But the deflationary forces weren’t through yet and by 2015 the FED was once again battling deflation. So what is happening now?
The main idea behind investment is to grow and preserve wealth, and in many cases, find unique ways to generate more income. Popular wisdom has it that when interest rates rise gold prices fall because the opportunity cost of holding an non-interest bearing asset is growing. However, contrary to popular wisdom, recent interest rate hikes by the US Federal Reserve have coincided with a rising gold price. At the same time, investor confidence in the stock market is faltering due to the FED’s actions. Thus many investors can be seen rushing to the financial security offered by safe haven assets such as gold.
Back in 1918 gasoline was $0.25 a gallon and by 1932 prices had fallen to 18 cents a gallon! But as we all know over the last 100 years the purchasing power of the dollar has fallen drastically so in order to get the true picture we can’t just say that the lowest price of gas was 18 cents per gallon, we need to adjust the price for inflation.
Electricity Price Inflation Residential electricity prices in the U.S. have risen from an average of 7.83 cents per kilowatthour in 1990 to an average of 11.44 cents per kwh in 2010. This is a 46% increase in 20 years and sounds like a lot but as you can see from the chart below for many years[Read More…]
Source: inflationdata.com | NYSE Index Inflation Commentary To Print this Chart: When Printer dialog box appears be sure to switch to Landscape mode Note: Please feel free to link to this page but not to the image itself as the image may be renamed (or deleted) when it is updated but the page URL will[Read More…]
Your Ability to Choose Should Increase Competition In years past consumers didn’t have a lot of choice when it came to their natural gas supplier, they were tied to the local gas utility, so if they wanted to charge a 541% markup you were pretty much stuck. But just prior to the new millennium states began[Read More…]
Inflation Adjusted Real Estate Prices- Lets take a look at the idea that housing prices always go up. Of course, each neighborhood is different, so some neighborhoods might be going down while a few miles away housing prices are skyrocketing but by looking at the nationwide average we can get a better picture of the overall trend. The St. Louis Federal Reserve publishes the following chart that shows the S&P/Case Shiller National Home Price Index and by adjusting those prices for inflation we can get a better picture of how real estate prices really act. Is a home a good investment or not?
Inflation Indexed Bonds Performance- U.S. Treasury Inflation indexed bonds are supposed to protect you from the ravages of inflation while providing a safe and decent rate of return on your money. Obviously, since safety is generally inversely proportional to risk, if inflation indexed bonds are very safe you would expect the rate of return to be[Read More…]
