I would advise to ignore the CPI

[John Chang]

Concentrate on the PPI, and if you have to focus on one thing, focus on the 12 month moving average of the crude goods section. It's no good knowing what the current rate of inflation is (nothing you can do about it), but what is much more useful, is knowing what the future rate of inflation will be (something you have a chance of doing something about).

Some would say that gold is an indicator of inflation, but I would say that it is more of an indicator of future inflation, than present inflation. The change of gold 6 months ago is more of an indicator of present inflation. Or take the change of gold's 200 DMA and you'll probably get a pretty accurate present inflation rate.

 

[Justin]

Some would say that gold is an indicator of inflation, but I would say that it is more of an indicator of future inflation, than present inflation. The change of gold 6 months ago is more of an indicator of present inflation. Or take the change of gold's 200 DMA and you'll probably get a pretty accurate present inflation rate.

I agree. It's funny that the MSM does not explain gold's rise this way. Of course, to do so they would have to admit that there is more inflation on the way - and they like to paint a rosy picture of the future whenever they can.

 

[Yossarian]

Good Advice John, Thanks. I googled the PPI as you suggested and WOW! What a difference from the CPI. I wonder how anybody could rationally explain the massive discrepancy without including deception?

 

[John Chang]

Some would say that gold is an indicator of inflation, but I would say that it is more of an indicator of future inflation, than present inflation. The change of gold 6 months ago is more of an indicator of present inflation. Or take the change of gold's 200 DMA and you'll probably get a pretty accurate present inflation rate.

I agree. It's funny that the MSM does not explain gold's rise this way. Of course, to do so they would have to admit that there is more inflation on the way - and they like to paint a rosy picture of the future whenever they can.

To some extent, the MSM doesn't understand or know gold/silver/commodities. The MSM needs to sell articles that the public will buy. People won't buy articles that either contradict what they think they know, or what they don't understand. Which is why they focus on what X corp is doing, or what corp is buying Y corp for. That's what the public knows and understands right now. Or what they think they know and understand. Also, an MSM story only has to be true long enough to sell sufficient copies. It doesn't have to be true past the next set of stories.

Of course, if the public only knows or understands frivolity, even better. The stories don't even have to be true, just titillating and salacious. Then, you can just pump out meaningless noise.

MSM can be a good indicator for inflection points. Either something is busting into the public's awareness, or something is about to reverse. Sometimes it's hard to tell which is which. But a headline is usually an inflection point of some sort.