Wednesday, November 19, 2008
The Labor Department reported the Consumer Price Index dropped a full one percent in October, the biggest decline in 61 years, driven largely by tumbling energy prices.
Core consumer prices, excluding food and energy, declined 0.1 percent, the first decline in over a quarter century. Unfortunately, food prices did not go down.
Contrary to some news reports, price declines do not appear to be widespread - automobile, computer equipment, and apparel prices fell in October, but that's nothing new. Food prices and medical costs continued to rise - that's nothing new either.