Interesting Inflation News Links (February 21, 2009)

* Stock Decline Hits Depression Levels (Michael Mandel, BusinessWeek)

Stock Decline Hits Depression Levels Money invested 10 years ago in stocks have lost half their real value, matching the worst ten years of the Great Depression

* Reviving Japan’s Economy: Not Many Options Left (Ian Rowley, BusinessWeek)

Reviving Japan’s Economy: Not Many Options Left With a stalled stimulus plan, soaring yen, shrinking population, and plunging exports, can the nation jump-start its economy?

* Japan’s lessons for a world of balance-sheet deflation (Martin Wolf, The Financial Times)

What has Japans lost decade to teach us? Even a year ago, this seemed an absurd question. The general consensus of informed opinion was that the US, the UK and other heavily indebted western economies could not suffer as Japan had done. Now the question is changing to whether these countries will manage as well as Japan did. Welcome to the world of balance-sheet deflation.

* Honolulu inflation slows (Allison Schaefers, Honolulu Star-Bulletin)

Honolulu residents and visitors were still paying more for goods and services during the second half of 2008, but the rate of Oahu’s consumer price growth slowed to narrow the gap between Honolulu’s rate of inflation and the average for other U.S. cities last year.

* Income crisis? What crisis? (The Financial Times)

As interest rates fall to 1 per cent in the UK, and lower still in the US and Japan, worries for the plight of the income-starved saver fill the financial press. But, at the risk of irking Financial Times readers, I cant help but wonder Crisis? What crisis? Far from being in the midst of an income drought, UK income investors are almost absurdly spoilt for choice. Let me explain why.

* Airlines cut off the North as economic woe takes its toll (Simon Calder, The Independent Online)

Heathrow handles more international passengers than any other airport in the world but, from the end of next month, new arrivals will be unable connect to West Yorkshire or Teesside.

* Food drove prices up 3.9% in ’08 (David Holthaus, Kentucky Enquirer)

Keeping the family grocery budget in check became a lot harder last year as prices for milk, cereal and even fruits and vegetables rose at their fastest clip in almost two decades.

* Cost of living rose in January (Des Moines Business Record)

The Consumer Price Index rose 0.3 percent in January, the first rise in six months, as gasoline prices stopped falling and retailers began raising prices after the start-of-the-year discounts, Bloomberg reported. But some Federal Reserve policy-makers still worry that prices could continue to decline this year, leading to deflation, a prolonged drop that would hurt lenders and company profits.

* Motorists cringe at gas tax plans (Noah Bierman, Boston Globe)

Massachusetts motorists yesterday greeted the prospect of paying the highest gas tax in the country with a mixture of anger, wincing resignation, and measured support as a way to help fix the state’s dilapidated transportation system.

* Full steam ahead to prop up train firms (Times Online)

MINISTERS are preparing plans for a backdoor bailout of train firms by subsidising fares for job seekers and freezing ticket prices that might otherwise have fallen this year.


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