Core cpi inflation in June 2025 is up sharply to 2.93% year over year from 2.78% in May

 

Kevin Hassett is full of it as usual

 

Trump tariffs don’t cause inflation because of ‘patriotism’ buying: WH advisor Hassett

 

That makes no sense.

 

Buying costlier U.S.-made goods over foreign goods would naturally boost inflation, quite apart from new tariff differences in price. 

 

Meanwhile the core pce inflation rate in May 2025 year-over-year was 3.88% higher than it was in April, the 65% majority of which is services but still includes goods.

 

That's what the 0.1 point rise from 2.577% to 2.677% means.

 

The May 2025 rate is actually slightly higher than in May 2024, which means we've made no progress in the last year. 

 

 

 

SPX since August 2000 continues to underperform the pre-Reagan era by almost 20% in real terms, the Reagan bull market era by almost 68%

SPX 8/2000-5/2025: 7.62% per annum nominal, 4.95% per annum real (inflation rate 2.54% per annum)

SPX 1/1871-7/1982: 8.15% per annum nominal, 6.18% per annum real (inflation 1.86%)

SPX 7/1982-8/2000: 18.99% per annum nominal, 15.28% per annum real (inflation 3.22%) 

 

We'll get the June 2025 Consumer Price Index report on Tuesday July 15th. The previous read was 2.4% yoy overall, and 2.8% yoy for the core.  

SPX vs. gold since 1913

 

Gold 1913-2025 ($20.67-$3500.05 peak on April 22, 2025): 4.689% compound annual growth rate, nominal.

The S&P 500 did better than that in nominal terms.  SPX 4/1913-4/2025 (8.79-5369.50, monthly average prices): 5.895% compound annual growth rate, which does not include dividends reinvested; the nominal per annum plus dividends reinvested produced 10.14% total nominal per annum.

In real terms the $20.67 price of gold in April 1913 is only $676.62 in April 2025, or 3.164% CAGR inflation over the period. So in real terms gold is up just 1.478% per annum over the period (from $676.62 to $3500.05). 

Again in real terms SPX is up more, 2.65% per annum without dividends reinvested over the period, and even more with dividends reinvested, 6.76% per annum.

Spot gold on July 4th was lower than in April, at $3329.67. 

SPX made a new high for the Fourth of July.

 

 

Core pce inflation in May 2025 rose to 2.7% year over year, which is a rate 80% higher than the 1.5% average rate 2009-2020

 Daddy's inflation.

 

 

Daddy's inflation

 

Methinks J. D. Vance doth protest too much about Jerome Powell

 

It backfired on Powell, though.

 

Yields climbed in response. 10Y went from 3.63 on Sep 16 to 4.37 by Nov 1. And core PCE inflation shot back up.

 

It's proof yet again that the Fed has next to no control over interest rates. It's one of the great myths of our time that it does, a myth Vance believes.

 

If Powell had cut and Kamala won, irrespective of what rates or inflation did, Vance might have an argument. He should quit complaining and take the win.

 

Meanwhile core PCE inflation was 2.66 in Sep 2024, same as it was in Mar 2025.

 

You'd think twice about trying that again, too, if you got burned like that, especially if you're being hectored by the tag-team wrestlers of the Oval Orifice.

 

 

 

Food items making new all time high average prices in the United States in May 2025

 All prices are FRED data from the St. Louis Fed in U.S. dollars.

 

Ground Chuck 6.018/lb

Coffee 7.931

White Sugar 1.054

Bananas 0.655

Potato Chips 6.731

Ice Cream 6.466/half gallon

100% Ground Beef 5.981/lb

All Uncooked Ground Beef 6.245

American Cheese 5.063

Beer 1.834/pint 

The world's population of everyday normal millionaires heh since the year 2000 has more than quadrupled to 52 million

 ... There is not much data on individuals in the $50 million to $1 billion range, which distorts the picture, according to Mazeau. He also said the wealth growth among middle and lower wealth brackets is underappreciated. For instance, the number of individuals with $1 million to $5 million, whom UBS dubs “everyday millionaires,” has more than quadrupled since 2000 to about 52 million.

“They have more wealth collectively than all the billionaires in the world,” he said. “It is often overlooked how much wealth is rising and is going towards the middle of the pack.”

The middle of the pack. Yeah right.

It takes $33 million in 2025 to be a 1913 millionaire. 

More in "The U.S. added a thousand new millionaires a day in 2024: Report".

Meanwhile . . .

 

 

It's stupid for Trump to riff off today's producer price report and call Jay Powell names because the number is likely to be revised higher, and besides, that's just poor form, old boy

 

 May 2025 core producer prices, aka core wholesale prices, were reported today up 3.02% year over year. That will doubtlessly be revised up, especially as we get farther away from May.

Today's chart indicates April was up 3.18% yoy, but was originally reported at 3.1%. The latter was already rounded up, but the former rounds up to 3.2%. We'll see if that gets revised higher in coming months as well.

March was up 3.91% yoy we are told today, but originally it was reported at 3.3%.

February was up 3.74%, but originally reported at 3.4%.

January was up 3.92%, but originally reported at 3.6%.

December was up 3.74%, but originally reported at 3.5%.

The average up revision, including April, has been 0.3. 

Be that as it may, we have in the May report nine consecutive months with core producer prices up in excess of 3% year over year.

Meanwhile for the nine years 2012-2020, the average increase was 1.62% yoy. I don't call producer prices rising at a rate 85% higher than that in May 2025 good news. It may be "less bad" news, but that doesn't make it good news.

Trump's a jerk to Powell. Vance is a very polished jerk. Remember his treatment of Zelenskyy? Stephen Miller is a jerk to Rand Paul. If you've seen the Trump cabinet in action, many of whom are political losers, you've seen even more insulting jerks. They may be descendants of the people of Jerkola for all I know, but I can only speculate.

 

 

  

 

The average price of piped utility natural gas in May 2025 was 1.626, 59% higher than the 2010-2020 average of 1.023

 

The average price of gasoline in May 2025 was $3.306 per gallon, 7.2% lower than the average under Biden but still much higher than under Obama or Trump I

Under eight years of Obama gasoline averaged $2.974 per gallon.

Under four years of Trump gasoline averaged $2.488.

Under four years of Biden gasoline averaged $3.563. 

Electricity made a new all time high price in May 2025 at 18.2 cents per kWhr, which is 36% higher than the 2010-2020 average of 13.4 cents

 

The average price of a dozen eggs in May 2025 was $4.548, which is 157% higher than the average price of $1.769 2010-2020

 The homeowner with the coop up the street sells his for $5 a dozen, but he was out this morning.

The homeowner with the coop down the street sells his for $4 a dozen, but he was out, too.

At the corner convenience store I had to pay $6.49.

 

CPI food inflation year over year in May 2025 was 2.87%, 53% higher than the 2010-2020 average of 1.87%

 

Core cpi inflation year over year in May 2025 is 2.8% for the third month in a row, 55% higher than 2010-2020 average of 1.8%

 The not seasonally adjusted trend is flat as a pancake.

The seasonally adjusted trend puts a little down-tilting lipstick on the trend pig, but still rounds to 2.8%. 

In 2025 you gotta be a $33 million millionaire to be a real millionaire

Pizza chains struggle because low income consumers can no longer afford prices up 30% since 2019

 Bloomberg reports here.

 

 

Low-inertia renewable energy systems are prone to blackouts such as in Spain in April because they cannot maintain stable frequencies in the absence of high-inertia fossil fuel, hydro, and nuclear energy systems

 The Physics Behind the Spanish Blackout: Madrid knew solar and wind power were unreliable but pressed ahead anyway.

When a grid failure plunged 55 million people in Spain and Portugal into darkness at the end of April, it should have been a wake-up call on green energy. Climate activists promised that solar and wind power were the future of cheap, dependable electricity. The massive half-day blackout shows otherwise. The nature of solar and wind generation makes grids that rely on them more prone to collapse—an issue that’s particularly expensive to ameliorate. ...

Grids need to stay on a very stable frequency—generally 50 Hertz in Europe—or else you get blackouts. Fossil-fuel, hydro and nuclear generation all solve this problem naturally because they generate energy by powering massive spinning turbines. The inertia of these heavy rotating masses resists changes in speed and hence frequency, so that when sudden demand swings would otherwise drop or hike grid frequency, the turbines work as immense buffers. But wind and solar don’t power such heavy turbines to generate energy. It’s possible to make up for this with cutting-edge technology such as advanced inverters or synthetic inertia. But many solar and wind farms haven’t undergone these expensive upgrades. If a grid dominated by those two power sources gets off frequency, a blackout is more likely than in a system that relies on other energy sources. ...

Just a week prior to the blackout, Spain bragged that for the first time, renewables delivered 100% of its electricity, though only for a period of minutes around 11:15 a.m. When it collapsed, the Iberian grid was powered by 74% renewable energy, with 55% coming from solar. It went down under the bright noon sun. When the Iberian grid frequency started faltering on April 28, the grid’s high proportion of solar and wind generation couldn’t stabilize it. This isn’t speculation; it’s physics. As the electricity supply across Spain collapsed, Portugal was pulled along, because the two countries are tightly interconnected through the Iberian electricity network. ...

The core pce inflation rate in April 2025 at 2.52% year over year is still almost 65% higher than the 2008-2020 average at 1.53%

The rate was last lower than in April 2025 in March 2021 at 2.20% yoy, which is good news.