Today, the US inflation numbers were released and CNBC proclaimed “US core inflation posts biggest gain in nearly 1 1/2 years!” Yes, core inflation (CPI less food and energy) rose 2.1% YoY, hardly distinguishable from other readings since 2000. But what is noticeable is the “Greenspan Retreat,” the last time core inflation exceeded 5%.
Of course, housing rents and prices are growing at over twice that of core inflation. The FHFA purchase only index YoY is growing at 5.2% and owner’s equivalent rent is growing at 3.4%.
Things have never been the same since Fed Chair Alan Greenspan’s tenure. It is off to the races for assets since Greenspan and his merry men.
Alan Greenspan cheering 5% core inflation in 1990.