PPI rose 1.7% month over month

[Slimprofits]

http://news.briefing.com/GeneralCont...17HeadlineHits

Producer prices rose 1.7% month-over-month, a much greater rate than expected in August. Consensus forecast a rise of only 0.8%.

[..]

Further, a closer look at monthly data shows that the increase in the month-over-month headline inflation was due to a strong rebound in both oil (8.0%) and food prices (0.4%).

Excluding oil and food prices, the core index rose a much more modest 0.2%.

Finished consumer good prices increased 2.3% in August after falling 1.5% in July. Increased car prices (0.7%) pushed up consumer durable prices 0.3%. Capital equipment prices increased 0.3% after declining 0.2% in July.

The intermediate materials, supplies, and components stage of processing group posted a 1.8% month-over-month increase in August. As with the finished goods, most of the increase was due to higher energy prices as core intermediate prices increased only 0.6%.

The crude stage of processing group increased 3.8%. The details are a little more troubling. Even though energy prices rose 6.9%, a decline in food prices pushed core crude prices up 6.0%. Much of the increase in core crude prices was due to a large increase in iron and steel scrap prices (13.5%).

[Slimprofits]

Re: PPI rose 1.7% month over month

Back in the beginning of March with oil at $48, I guessed based on the usual seasonal rise in demand (Summer) that oil would be at $60 by August.

Now the question is, if EJ is right about the S&P dropping to 500-600 by the end of the year, is oil going to be piled into or abandoned? If it's the former, the price will be at $90 in December.

[touchring]

Re: PPI rose 1.7% month over month

Back in the beginning of March with oil at $48, I guessed based on the usual seasonal rise in demand (Summer) that oil would be at $60 by August.

Now the question is, if EJ is right about the S&P dropping to 500-600 by the end of the year, is oil going to be piled into or abandoned? If it's the former, the price will be at $90 in December.

Did EJ say that S&P will drop to 500-600 by the end of the year? Doesn't look like it will happen unless something drastic, likes of Israel attacking Iran or the Fed starts raising rates or H1N1 becomes deadly?

[charliebrown]

Re: PPI rose 1.7% month over month

i agree, its going to take some big shoe to drop to switch from greed to fear again. could china melt down? treasury market crack? dollar collapse? iran light off a nuke? spain collapse? if everything stays the same with regards to prices, inflation numbers are going to keep printing higher due to y-o-y comparisons in energy and food. It was oct 1 2008 when energy prices cratered.

is there some covert operation propping up of stocks? We're in a recession and ttm p/e is over 20. doesnt matter that 4 banks a week fail. unemployment increases every month, china keeps talking about dreducing their dollar holdings etc. nothing shakes this market. On itulip it says higher dow increases consumber sentiment, then it would behoove the gvt to funnel money into the market.

I talked to my fed representative over the weekend. (yes face to face, informally at a weekend event). he voted against the bush and obama stimulous. He said what was very troubling to him is that there is no account of where most of the money went. He is on the ways an means committe. Could it be being funneled to GS or other ibanks to manipulate the market?

Another thing that torks me is the other day I got asked to support a fund for getting kids school supplies. On the list were things like paper, pencils, markers etc. You mean to tell me that we spent 750B in stimulous and kids dont have pencils in a public school :-( WTH??

I have heard that if you want to influence the market you can buy a lot of call options?? i dont understand this but that is what i read. Anyhow a few hundred B$ levered up through an ibank, could give a lot of mo to the stock market.

Another troubling thing is on sept 1, with the rumor that a big bank was going down the market lost a few hundred dow points very quickly. this was the only day in the last few months with any decent volume. all of this up has happened on very thin volume. Maybe someone is buying just enough each day to goose the market a little higher, waiting for the poor retail investor to jump in.

[Slimprofits]

Re: PPI rose 1.7% month over month

If China's bubble doesn't burst and/or markets don't otherwise drop, than oil is going through the roof with no seasonal drop. I'm going to place a small wager on a replay of late 2007 into 2008. $90 a barrel in December and $120 in June.

[icm63]

Re: PPI rose 1.7% month over month

Many believe the shock with credit cards and commercial loans and the NEW FASB rules will kick in next year ...

Mind you as senate elections are next year, I guess the stimuli will be full on then !

[magicvent]

Re: PPI rose 1.7% month over month

Do you disagree with EJ's prediction that the S&P falls to 600 by the end of the year?

[metalman]

Re: PPI rose 1.7% month over month

Do you disagree with EJ's prediction that the S&P falls to 600 by the end of the year?

is the forecast for the s&p to hit 500 - 600 by the end of the year or to end the year there?

[charliebrown]

Re: PPI rose 1.7% month over month

if it hits, 600 anytime between now and the end of the year, I don't see it "getting off the mat" say to 800 - 900 by the end of the year. investors will be twice burned in a year. they are not going to go back in for a long time.