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Strategies & Market Trends : John Pitera's Market Laboratory -- Ignore unavailable to you. Want to Upgrade?

To: John Pitera who wrote (7219)	10/28/2005 12:38:57 PM
From: Jon Koplik	Read Replies (1) \| Respond to of 33421

My "rant" to WSJ on inflation / no inflation ......................................... Date: Fri, 28 Oct 2005 12:36:20 -0400 To: newseditors@wsj.com From: Jon & Sharon Koplik Subject: biased reporting on GDP / employment costs From : A WALL STREET JOURNAL ONLINE NEWS ROUNDUP October 28, 2005 10:44 a.m. ******************************************************************************** "But a yardstick of inflation that strips out volatile food and fuel prices actually moderated. The "core" PCE price gauge rose 1.3% in the third quarter, down from 1.7% in the second quarter and well below the first quarter rate of 2.4%. Such evidence that higher energy costs aren't yet flowing through to other prices is likely to keep the Federal Reserve moving along its path to higher interest rates." -------------------------------------------------------------------------- So ... there is ZERO sign that "higher energy costs are ... flowing through to other prices" but (according to your article) : "Such evidence ... is likely to keep the Federal Reserve moving along its path to higher interest rates." PLEASE EXPLAIN. Plus -- energy prices are not "high" any longer. For example -- spot unleaded gasoline is now $1.60 per gallon, down from over $2.90 a gallon (right after Hurricane Katrina). ------------------------------------------------- Also, your coverage of the ECI : "A separate report from the Labor Department showed that labor costs were also on the rise in the quarter. The employment-cost index rose 0.8% in the July-September period, up from an unrevised 0.7% increase in the previous quarter. Wages and salaries grew 0.6% in the third quarter, matching their pace in the first and second quarters. Benefit costs, which have been growing faster than other compensation for several years, accelerated to 1.3% growth in the third quarter from 0.8% in the second quarter." conveniently left out something I heard on CNBC (which I assume is correct) : The year over year increase in the ECI of 2.3% is the lowest rate of increase in TWENTY-ONE YEARS. Please explain how the ECI "showed that labor costs were also on the rise in the quarter" Jon Koplik.