Yes - more of what I teach:  Full Employment, Price Stability and Economic Growth!!

Notice that does NOT say Falling Prices or Rising Prices (deflation or inflation) but Price Stability!  So we have a problem Washington ...

Or do we?  Look at the CORE CPI rate:  the rate of inflation without food and energy prices!!  Down 0.1% in October and flat in November!
Ah HA!  But why exclude food and energy, those some of the most important things that I buy, I always hear. 

Not true - housing is the #1 item bought by consumers.

OK - China has decided the NY TIMES is off limits now!  Who KNOWS how long  so I cannot check this link - I BELIEVE it goes to the CPI report there but cannot verify so - alas, I can GET there but not give you a proper website ... NEVERMIND!

However, here is the housing graph from the original article:

                 
NOW THAT'S a tough picture if you are in the housing industry!!

From the article, a couple of great quotes and the true drops in prices:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

The price of gasoline plunged 29.5 percent while the cost of fuel oil fell 13.6 percent. Food and beverage prices crept up 0.2 percent in November, their slowest rate of growth all year, while clothing prices were up 0.3 percent.

The unadjusted year-over-year inflation rate was 1.1 percent, the government reported.

“I’ve never seen the economy slam on the brakes as much as it has in the last three months,” said Bill Hampel, chief economist at the Credit Union National Association.

Meanwhile, new data showed the nation’s housing market continuing to lag. The Commerce Department reported that housing starts fell to a seasonally adjusted 625,000 in November, far below Wall Street’s expectations.

The housing starts in November represented an 18.9 percent decline from the previous month and were 47 percent lower than November 2007. New-home construction in October was revised downward to 771,000 units from an earlier estimate of 791,000.

“This is mind-bogglingly awful,” Ian Shepherdson, United States economist at High Frequency Economics, wrote in a note. “The only consolation here is that unless sales drop much further from their already fantastically depressed level, the pace of new construction is so low that inventory will fall quickly. Right now, though, housing is still a disaster area.”