The Consumer Price Index (CPI) rose 2.7% over the prior year in November, less than the 3.1% increase that had been expected by economists, according to Bloomberg estimates.
On a “core” basis, which strips out the more volatile costs of food and energy, prices rose 2.6% over the prior year in November. Economists had also expected to see a 3.1% increase in core prices…
In September, the last month for which there is inflation data, both the headline and core CPI measures rose 3% from the same month last year.
BLS just made up much of this data, carrying forward data from September that results in lower CPI. The next release will be interesting. Or maybe it will be more imagined managed numbers.
“November 2025 indexes were calculated by comparing November 2025 prices with October 2025 prices. BLS could not collect October 2025 reference period survey data, so survey data were carried forward to October 2025 from September 2025 in accordance with normal procedures.”
So Erika Mcentarfer is fired in early August because BLS reported inflation numbers that displeased the president. 4 months later surprisingly good numbers are reported and Wall Street catches fire, and fox features interview with Harvard professor touting the indisputably good numbers.
One day later we learn that economists are scratching their heads because the report appears to based on sketchy assumptions- essentially that owner’s equivalent rent and several other categories were assumed to be zero.
Wall Street appears not to have noticed or cared yesterday. But apparently the Fed likely did. They see that the next release will show a sharp upward revision in the inflation estimate when the real over numbers are released, or there will be more sketchy assumptions under the new bls administration that cannot be trusted.
The end game for the president appears to be to take over the Fed so that hand picked Fed officials will also use sketchy bls reports that underreport inflation so they can gas up the economy with more rate cuts.
I am guessing that inflation is worse than reported. I am also guessing that this Fed knows it. I do not know how that will change my investment strategy other than continuing to get my money out of the u.s. as fast as the tax man will allow.
Housing inflation is cooling. There might be very large April CPI housing inflation when the OER numbers get fixed.
“Annual outlook: We now forecast OER to end the year up 3.5% year-over-year, followed by a dramatic downshift to a 2.2% increase in 2026. In August, the OER index was up 4.0% year-over-year.
Annual outlook: We now forecast the Rent of Primary Residence index to end the year up 3.0% year-over-year, before decelerating sharply to a 1.7% increase in 2026. In August, the Rent of Primary Residence index was up 3.5% year-over-year.”
I think you are right. There likely is a downward bias in the report due to assumptions made in place of the missing numbers from October and November, but disinflation is still a reality and there are still enough reliable numbers (hopefully) for the Fed to make reasonable assessments at this point: NY Fed President Williams says some 'technical factors' distorted November's CPI reading downward
My money is still shifting from the U.S. as fast as the tax man will allow, but that may reflect my distrust of our failing democracy and natural pessimism rather than a knowledgeable opinion.
Twelve years ago I began the legal and financial processes necessary to move my main/permanent residence from the USA to Mexico. I did NOT do that for political reasons, but rather because Mexico and Mexican friends have always (since my infancy in El Paso, Texas) brought me a sense of comfort and pleasure. Back when I moved here Mexican politics were hopelessly stupid and corrupt, and there was little solid prospect of any improvement. But for someone like me, using my experience and knowledge, Mexico was relatively safe, and was also seeing real pressure for meaningful political reform, and even some quite significant movement.
I am struggling to answer your excellent question. I looked at moving to Canada but there was no way my wife would leave our grown daughters and families behind. Mungofitch over at Shrewdom has the best discussions of potential stocks in UK, Europe, and some other developed countries. They have a nice ongoing discussion of potential ex-U.S. picks.
Mostly I moved as much as I feasibly could to European and developed markets ETFs, as well as an international etf which unfortunately also has to some undemocratic countries. Those funds have done quite well this year and maybe next. But I feel like I am metaphorically moving to a new country out of desperation to escape what is happening here but with no clear plan.
Your question may also contain a deep seated assumption that I no longer hold. I believe that the U.S. had a durable economy-past tense. I fervently hope I am wrong.
This may be a fair guess, though it appears to be optimistic compared to my view of the disintegration of our federal legal system due to the recent corruption of our executive branch enabled by a subservient Supreme Court and Congress: Democracy Index by Country 2025