News & Anti-News: Producer Prices

We hold to the silly notion that there is both “news” and “anti-news” in the world.  Sort of  like “matter” and “anti-matter.”  In case you’re not clear on what “anti-news” is, it’s the sheep feed.  Stuff that fills up people’s minds with base emotionalism, but doesn’t put anything on the personal bottom line.

Before we get into the real news, a few “anti-news” stories that have caught our eye.  Remember the metric is:  “How does this help me live better?

On the other hand, there are also “useful truth leaks” to be found:

We judged these two useful because in the one case, how many computer companies were founded by drop-outs?  And the second story tells us “not all is as it appears.”

Well, except for here of course.  We focus mainly on making and keeping your financial person intact so you can afford the more useful distractions.

Now, About That PPI Report…

Since it’s football season (for people who have too much money and like to sit outside in the cold for reasons that escape us), we will begin by “going long” for a moment:

This is the long-term relation between what things cost when you buy them (the consumer price index) and what things cost to make (the long-term PPI).

Depending on your caffeine loading, you may notice the red line (Consumer Prices) began to seriously diverge from costs to make things (PPI) circa 1980, or so.

Looks to us like two factors are in play:  Rising tax loading on the one hand, and increased corporate profits on the other.  Off to the side, we have moved into an “information-based” economy, as well.  Which means that the “Producer Prices” likely don’t adequately count the cost of producing lines of code.

Back in 2010, the Gallup organization reported  a couple of very  interesting facts:  “Gov’t. Employment Ranges From 38% in D.C. to 12% in Ohio – Federal, state, or local government employs 17% of U.S. workers nationally.”

While much has been made (by disingenuous politicians) about how the “size of government” is being reduced, when we look into the data we see there has been a fair amount of “off-loading employment” onto private corporations.

Take prison management, for example:  In 1980 there was relatively little non-government “caging people” but today it’s commonplace and a “growth area.”  Regardless of the government employee body count, though, it still costs money and that shows up in higher property, sales, excise, income, and business taxes.  The myth is “businesses pay taxes” but the sad reality is they’re just another pass-through costs, sometimes marked up.  (Sand in the Vaseline, anyone?)

I don’t mean to go off into the weeds about this, but look at when “The CPI/PPI Gap” began spreading and you’ll find it was shortly after American Peak Prosperity.   Back in the time when one person in a household could support a family including a home and car. The compounding interest effects on  government deficits is now arriving and this will hurt over time.  Government won’t lose (they are rulers after all!).

You will.

With such a cheerful outlook, here’s the press release from Labor:

“The Producer Price Index for final demand edged up 0.1 percent in November, seasonally adjusted, the U.S. Bureau of Labor Statistics reported today. Final demand prices advanced 0.6
percent in October and 0.2 percent in September. (See table A.) On an unadjusted basis, the final demand index moved up 2.5 percent for the 12 months ended in November.

In November, the rise in the final demand index can be traced to a 0.3-percent increase in prices for final demand services. In contrast, the index for final demand goods decreased 0.4 percent.

The index for final demand less foods, energy, and trade services moved up 0.3 percent in  November, the third consecutive increase. For the 12 months ended in November, prices for final
demand less foods, energy, and trade services advanced 2.8 percent.

Final Demand

Final demand services: The index for final demand services moved up 0.3 percent in November, the third straight rise. The broad-based November advance was led by a 0.3-percent increase in the index for final demand trade services. (Trade indexes measure changes in margins received by wholesalers
and retailers.) Prices for final demand transportation and warehousing services climbed 1.2 percent, and the index for final demand services less trade, transportation, and warehousing inched up 0.1 percent.

Product detail: Most of the November advance in prices for final demand services can be traced to margins for fuels and lubricants retailing, which jumped 25.9 percent. The indexes for health, beauty, and optical goods retailing; cellular phone and other wireless telecommunications services; airline passenger services; food wholesaling; and truck transportation of freight also moved higher. Conversely, prices for guestroom rental fell 3.5 percent. The indexes for machinery and equipment wholesaling and for portfolio management also declined. (See table 4.)

Final demand goods: The index for final demand goods moved down 0.4 percent in November, the largest decrease since falling 0.5 percent in May 2017. The November decline was the result of a 5.0-percent drop in the index for final demand energy. In contrast, prices for final demand goods less foods and energy climbed 0.3 percent, and the index for final demand foods advanced 1.3 percent.

Product detail: Leading the November decrease in the index for final demand goods, gasoline prices dropped 14.0 percent. The indexes for liquefied petroleum gas, electric power, fresh fruits and melons, jet fuel, and primary basic organic chemicals also moved down. Conversely, the index for pharmaceutical preparations rose 1.5 percent. Prices for fresh and dry vegetables and for residential natural gas also increased.

After the report (which we viewed as slightly deflationary) the futures continued up 232 on the Dow.  “Why so you think that was?” we asked.  Then cameth the Light of EBM! (Everything’s a business model)

The Market Doesn’t Care

Why should it?  You did catch the part about pass-throughs, right?  Here’s our daily look at the One Chart That Matters:

We’ve got a soft case that the market will move up for a couple of days and then resume down next week.  The key is the Fed meeting and rate decision next Wednesday.  If you look at the six month view of the 10-year Treasury Note over here, you’ll see the bond market has been thinking that rates are done going up.

One of our readers (Don Bondi) who’s a Texas bond trader, thinks a lot of people have it wrong.  He’s figuring a 90 percent chance of a hike since government has to keep rates going up in order to get people to buy bonds.  His concern is bolstered by the Reuters report out today that “Foreign investors spurn U.S. Treasuries as curve threatens to invert.

The Fed, logically, could maintain (or grow) bond sales by doing only one thing:  Raise the rates – again.  This would give foreign investors a deeper discount on US bonds.  There are also fears that China might be selling bonds – a tit-for-Trump – for his trade footwork.  But, we shall see.

Dear Planet,

What are you doing, all this shaking?

The blue dot above is the 7.1 quake overnight in the South Sandwich Islands.  It would go nicely with something in the Soup Islands….(Oops…tripping out a bit, are we?)  Still, low of the solar cycle seems to be when the Earth, she shakes it.

Global Warming

The story Storms pack a punch in the Northwest got us to looking at the national forecast map earlier.

The yellow lines are mine – a short-hand for watching winter weather roll in waves across America.  The “nice area” is between the waves.

People are still worked up over climate despite the fact there’s no sign of the solar minimum ending until at least into 2020 in the latest solar weather prediction data sets (yes, we import and chart them).  Which make stories like the UN science panel chief calls for more action to curb warming somewhat amusing.   The US has still reduced more CO2 than any other country on Earth, last I checked…regardless of alarmist hype about needing to sign this, or that.  Where were thety when the Laurentide Ice sheet was shrinking?  Didn’t that raise sea level dangerously?

But, it’s useful to remember that oftentimes people marry-up to ideas, regardless of the available data.

Along the same lines as monetizing climate change (see how well that scam is playing in France?), we see Bitcoins are down to $3,338 as of press time…and we will dutifully report when they under $3000.

An old Ure family saying – one of Pappy’s favorites – is on point.

“Don’t confuse me with facts.  I’ve already made up my mind.”

We learned a lot from that…not everyone was so blessed.

Moron the ‘morrow…

18 thoughts on “News & Anti-News: Producer Prices”

  1. Do not come to Washing DC politics unless you are a team player says the Deep State to President Trump, or we will go to any lengths to impeach you, dishonor you, and ruin the lives of you & your family. We have reserved a room for you in our prison system where you will eat & sleep & be out of our way.

    Is this the kind of government you want? Homeland Security is watching & has a prison cell reserved for you too.

    • AND the President is “trumping” with Q and the military soon to be isolating ALL the traitors and minions that have tried to bring this country in line with the Globalist agenda….President Trump was ‘hired’ to correct this Ship of State ..and return its steerage back too ‘we the people’…and take back this country…like it or not, hate him or not….he will ‘get ‘r’ done’…..and many will see that accomplishment from behind bars…(some even sitting and partying at the same)

      • d,. I am sorry to inform you, this all somewhat an elaborate ruse.

        i am neither Republican nor Democrat. I voted for Trump but i already knew before his anouncement to even run president, that he would & win the Presidency.

        On 10 December 2018 “Q” messaged the following.

        “The plan to have the FED raise rates [steep?incline?? beginning Mar 2019] in an effort to??????’kill’ the econom?y prior to 2020 P_?elec is????????????known and planned for.”Structure? change coming?

        As i have made this comment before, a few times now. The above from Q is late to those who have been paying attention, all it does is confirm everything that was stated by me over 2 years ago on this site and 2 others. Everything is unfolding as wae stated.

        I dont pay attention to politics because to me. Its no different then big time wrastling. Its scripted and is all “Theater” , nothing more than entertainment, something to keep you emotionally invested in and attached too.

        ALL OF THIS, weather you think so or not is following a trajectory that was produced. A trajectory that is the responcibility of every human being on this planet from the Fed to xi tng a rice farmer in Vietnam to mandi black that works at the loves truck stop in kansas city oklahoma. All of us through action or inaction contributed to our current trajectory.

        sure, there is “free will” and all that was taken into consideration.

        George is aware of my intuition and more than often times im right. However, this too will be a surprise to him.

        Im going to do this in steps. To give you and everyone else the Choice of how far down the Rabbit hole, you wanna go. That is entirely up to up you, should George allow this comment to even be posted.

        Step one at the link:

        Originally, posted by
        0. <<—- (Thats me, Andy. )
        User ID: 72025122
         United States
        04/18/2016 10:05 PM

        "Trump will win the Presidency and be left holding the bag." And much more at the Link:

        Step 2. Drop down 5 posts and you will see, clearly the following posted on same date in 2016.

        "The World's federal reserves highered the top 13 tech companies to come up with a version of bitcoin. IBM came up with the best viable solution and it has been tested and ready to deploy once the world's economy collaps. They will be able to easily establish it as the world trading currency once the dollar collapses.
        So now, it will begin to unfold around 2019."

        Verfication if that as a plan, from "Q", Almost 3 years ago.

        This last link is a doozy, best have a think about whether or not you really wanna know. Every wants to know the truth but most wont accept it. They just cant, they as you say too emotionally invested/attached. "The Red pill" is a hard one to swallow.

        Step 3, full disclosure, I probably wont post again for a while. Need shake the heat off of me.

        Dated today,

        At the link:

        again, i dont care if you believe me or not, im not here to sway you or convince you of anything. However, Everything thus far has unfolded as was decided a group of people from all over the world including myself and later stated by me, after the decision collectively was made. I simply made a record of some highlights on a website that remains unknown to most of the world.

        Thanks George, oh i will be around. Didnt mean to burst anyones bubble.

      • Hi, Andy, I had a few questions: 1) Hillary, Jeb, and Biden are also of the 1%. Either of them winning instead of Trump wouldn’t have changed the timeline very much, would it? 2) You state: “The power elite do not want another country in control of the world’s estabilshed trading currency. This one will be controld by the worlds Federal banks.” Well, isn’t the Dollar controlled by the world’s Federal banks anyway? I mean, the USA doesn’t own nor control the Federal Reserve, so for me, it is just business same as usual, except, yes, they destroy America and the world reserve currency, just to replace it with a more controlled ‘world-reserve currency’ not based out of the Fed in the states. Other countries are destroyed, too, Japan as you mention goes first, etc. Whose kidding who here in the ultimate control feature and if it will really make a difference? It obviously won’t end war, or poverty or cycles, so what is the point, it’s like a new boss the same as the old boss? 3) You state also: “So that one nation economy in the world doesnt control all the power.” We didn’t control OUR power, the banks controlled OUR power and thus, our elected leaders. It has not been the will of the people for endless wars, open borders, dumbing down the population, races pitted against each other, propaganda press 24/7, etc., that’s the elites using their money to purchase and keep their power. And that is happening in Europe and USA. 4) Also: “I was asked to give the angel in “the garden” a choice. He chose to give it 4 more years. In order for others to have more time to prepare.” How can people prepare? Please, bear with me, is it George’s site that is the wayshower to preparations (and others like his from a prepping platform?) Or is it truly impossible to prepare? How can one prepare for a Civil War? I constantly wonder and think about this and have tried to take some actions, yet, unsurity dogs my steps. Where in your 2 choices is the sanctity of life? You all, the deciders, were given 2 choices: 2/3rds destruction of humanity via nuclear war, or collapse the currency and civil war in the USA; what about the divine? You also say: “As the Elite know, it is The Divine that can change the rules and has absolute athority to shift directions without any prior notice.” Is this consortium of empaths and spiritual people drawn together to vote, are they the divine or representative of the Divine? 5) I got this quote from the Alien Interview site submitted by another contributer to this site: “There are IS-BEs on Earth from unnamed races, civilizations, cultural backgrounds, and planetary environments. Each of the various IS-BE populations have their own languages, belief systems, moral values, religious beliefs, training and unknown and untold histories.” Andy, is this what you mean by: “There is no “maybe” there is and be and am. Is becomes be and be becomes am. Every time. No matter which line it is in.”???? I hope you take my questions in the respectful intention in which they are submitted. I, too, had a unusual vision one day at Thanksgiving morning 2009, showing me this collapse of the dollar as the world reserve currency, which I emailed George about on that day (that’s my proof in case it matters). So, my questions are sincere and most likely juvenile, but hope it helps others as well. I know I am not special, and I haven’t gotten any more huge hints, small ones, not big ones, so can’t even tie that vision to anything that I could understand or take action for or against. I did not hear nor respond to the call. Thank you for your time and also coming here; please continue to share here.

  2. Time for a TV Fireside Chat by President Trump to explain why he is firing Mueller & ending the Russian Witch Hunt & explain his plan to stop this Deep State control of politics. PT needs to go on the offensive.

    • Oh ECS (SIGH),
      Trump is part of a far worse cabal than the so called Deep State…He is part of the Corruption State. His New York “friends” were part of the nations biggest crime syndicates…He owes money to the Russians and is in bed with Putin…the worlds biggest crime boss. He also owes money to the Saudi’s the worlds biggest violator of women’s rights and his son and law and Journo Killer, MBS are pals.

      If you want to hear what a “Fireside Chat” would sound like from Trump, go watch the beginning of Gooodfella’s and listen to the narration of Ray Liotta as he introduces the guys he hangs out with.

      And Trump on the offensive?…I mean, he is offensive in many ways…but him directing an offense is as painful to watch as a snake trying to throw a football.

  3. Nice ! setting the table with a BOHICA piece today. Where else in the financial news media space could I get piece about Prisons as a Business Model with a nice side of anal ‘un-ease’ (sand in the Vaseline). Bet your readers in San Fran dont need any coffee this AM, after getting all lathered up about the corrupted Vaseline.

    Ure bond guy might be smelling a rat..

    There are no foreign buyers of US Debt, and have not been any for several months now. In fact foreign govts’ are net sellers of US debt. Foreigners converting their currencies into US dollars get scalped by strong dollar, thereby making US Treasurys a 0% RoR investment.

    What ever happens in the markets, Do Not Buy Cyrptos !

    Debear wants low entry price for mid month cost averaging purchase program.

    • DaBear – Are you really dollar cost averaging Cryptos on the downturn? Sounds like a good way to lose money. Why not just stick your tongue in a light socket for an electron fix.

  4. Writing here from the weather sweet spot, it seems that to get real news even about ourselves, it’s necessary to go overseas. British and Asian epapers give a much better view than most American media. LOL – “truth isn’t truth” – it seems Mrs Pelosi would have said that, but sadly, it’s Rudy. I hope he does right by the president, but I’m unsure about that.

    The big news of the day is that China detained a Canadian ex-diplomat as a response to the Canadians arresting Meng Lanzhou! After two days of bail hearings, nothing is yet settled.

    China is furious at Canada for the third party arrest of one of their favorite daughters, and I can see this escalating. Canada has done this before, FWIW. The only reason the USA has not yet been fully embroiled is the trade deal that both sides want to work out. IMHO, this will escalate further.

    • “The only reason the USA has not yet been fully embroiled is the trade deal that both sides want to work out. ”

      Or could it be that since most of our industrialization has been gradually shifting production and moving their headquarters out of the country that our country has basically become a consumer cash cow for them that it would be detrimental to their economy to upset sales.

      Just saying its all a business model.

    • UK Daily Mail always breaks America’s news before US controlled propaganda news gassers. But, they are very big on using the word WHITE before every white police officer incident or WHITE human crime, and they leave off BLACK, ILLEGAL (name your country), ASIAN, MUSLIM when those races/status’ do the killing, raping, assaulting. Daily Mail is a BIG Trump Basher, you can go there for the DAILY Trump Bashing. Always the Daily Mail frames Trump negatively. It can NEVER do one article that is favorable to him or his family. Think of the effect of 97% NEGATIVE news on a sitting President, in this country and all over the world for over the last two years, and more to come.

      • TDS,

        Trump gets negative news, because he represent nothing really positive. Even George has come around on this… What does Make America Great really stand for? What is the plan…other than a bunch of generalities.

        1. He can’t take credit for the economy…It was already on the rebound from well before the election. I had my best year over year increases ever from 2009-2017. This year, my business is down about 11% and while we are still doing well…I am very angry that I will be paying up to 7% more in taxes due to the new tax reform Trump and the GOP passed. Just wait until the middle of the first quarter when angry tax payers look at a higher dollar amount in Line 63…little or no money in Line 75 and a much higher dollar amount in Line 78. Trump has no clue what significance those lines mean to taxpayers, because he can’t even produce his own taxpayers for reference.

        2. Trump wants to shut down the government over $5 billion to help build a wall. I am surprised that Chuck and Nancy didn’t say today in their reality show like tussle in front of the camera’s…

        “Ok Donny…we will give you our proposed $1.3 billion for the wall, but we think it would be a great idea if you make your base happy and as promised over a hundred times during your campaign, get the remaining $3.7 Billion form Mexico. That’s what you promised right? Do you think you would have won the election if you had promised to build a wall with your loyal supporters tax dollars? Heck no…Go ahead…You are a good negotiator… Nobody negotiates like you right? The Best! You can do it Donny! Call Mexico…do the deal…And…Let’s sign this thing and get our budget funded!”

        3. He ran on draining the swamp, but instead, drained his own cabinet which is pretty much everyone he hired that was supposed to help him drain the swamp.

        4. He ran on being an outsider…and boy is he…He is still unable to crack the code on the inside.

        5. He ran on being a negotiator, but Little Rocket Man, Iran, Russia, China etc, have yet to concede to his demands and are kind of mocking him right now by doing their own doubling down on nuclear weapons, trade, and war games.

      • You should be happy to pay an extra 7% in taxes. You were worried about Trump’s “tax cut” adding to the deficit and only benefiting high income people. You sound like high income compared to my poverty level income.

  5. If we want a secure border mine it — arguing about a “stupid border wall” is as asinine as our present gov.

  6. I have difficulty getting people to grok that truth and facts are two different things. Look up the meaning of the words and grasp this; truth is what philosophy is about, whereas, facts are what real journalism and reporting is about.

    I recommend you go to YouTube and watch Randall Carlson interviews by Joe Rogan. Carlson is a real scientist as an avocation. He falls into the catastrophist category while gradualism is the mainstream view of things. While you are at it, check out Thornhill’s work “Thunderbolts” about the electric nature of the Universe.

    • I have read “Thunderbolts”, i have actually spoke with the authors son, on a message board on more than a few occasions. It is a very good read. Thanks for sharing.

  7. Big drop in the market today. Perrhaps, there is something to this AI trading platform. Had never occured to me before. Im gifted in many ways and an out of the box thinker in a lot of ways. However, i dont know everything and im definitely still learning some stuff and struggle with some stuff that a lot of people probably dont.

    And that is part of the reason i continue to come here. To be open minded and consider the things that i am unaware of.

    Thanks George, and evryone who contributes in the Comments, you all teach me so much. :)

    AI is Definitely something worth considering.

    I will remind you if what the word Casino means: “house of sin.”

    Ca means house, sin means well sin and the O at the end means of.

    Like the big Banks, “they aint in the buisness of loosing money”. They aint building these big hotels and resorts because they are losing. To bet against the “house” you had best have the the uper hand, and many who think they do? Lose.

    If its all in the name of Fun, well then it is there you can walk away, and keep whats in yout pocket.

    When i worked as a Casino Regulator, for 7 years. I seen many things and alot people loose business and homes and marriages etc. Etc thinking prolonged “winning ” was going to last forever. Best advice I can give: (wish i could bold this) have a set amount that you win as the signal to GTFO. Dont go in there with a Set amount you are willing to loose. Its a mind set. Why last weekend at the Emerald Queen, i saw a lady crank that Tripple Fortune Dragon slot machine up to $1800. I went and played some other stuff and walked around with my “feelers” out. Came back by her an hour later and she was down to $650, pumped $1150 back into the same machine. Capiche??

    Good article George. Love the latest writings and the signficant change in style. From my perspective, it seems to me, Ure “zeal” and “zest” is back. Its really good to see. It has been, significantly less last few months. Quite noticable. As that is the key to staying young and longevity.

    I know and have heard thousands of stories about people working their whole life and 6 months atter they retire, they die. Almost seemingly from boredom and a lack of direction and purpose. Super sad to see such a thing happen. I know and work qith more than a few guys who are already drawing a full pension and continue to work innmy trade becaue, they simply dont know what to do with themselves. Houses and cars all paid off etc, etc. Yet, the continue to work because they need something to do. Most of them though are only 40 hour a week guys and dont work Saturday or much OT, because they dont have to or have alrady done all that.

    Anyway, off to get a hair cut and beard trim.

    See ya around.

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