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The economic problem

| Posted by: Paul Donovan | Tags: Paul Donovan

  • The economic problem is finite resources and infinite demands. In the US, the finite resource is the time of members of Congress. The infinite demands are the Russian question, the FBI, following the Trump Twitter feed, Trumcare II healthcare reform, tax reform, etc. More time on the Russian question and the FBI means less time elsewhere.
  • US consumer price inflation is due. This is slowing even as prices are rising, through the (justifiable) mechanism of quality adjustment. More data downloads to your mobile (cell) phone means lower mobile services CPI, even if the mobile service charges are rising.
  • Evidence of the enthusiasm with which Americans are pursuing the national pastime of visiting the shopping mall will be on display with retail sales data today. The Michigan consumer sentiment opinion poll is also due, and should be accorded all the respect it deserves.
  • The Euro area has final April consumer price data from Germany and Spain – the seasonal adjustment distortions (down) in March should be reversed in this data, but it is unlikely to have the capacity to surprise investors. Revised German GDP data is also scheduled.