This image is what “sticker shock” looks like if you are an AI generator taking input from a novice at the keyboard. But for most real people, sticker shock really isn’t quite as dramatic as this cartoon girl here makes it out to be. For one thing, we’re not all covered in stickers.
The Core Producer Price Index, which measures the cost of wholesale goods sans food and energy, rose 0.1% over the last 30 days. But if you look at the broader basket of goods, the cost actually dropped 0.1% to 1.8% annualized. The markets were hoping for a more palatable 1.6% YOY reading, but they’ll get over it. Don’t worry super smart think tanks, we’re all wrong occasionally.
On the other side of the world, China has been experiencing deflation for almost three years now, and their government is doing everything in their own power to stimulate growth. It must be tricky when you’ve decried capitalism for so many decades that most people can’t comprehend that there could be any possible incentive to grow anything. Consequently, the government is doing their best to stimulate price appreciation on their own, without much success. You’ve gotta get 1.4 billion people on board first. China has 4X the population of the U.S. but their GDP is 30% less than ours.
