Tag Archives: CPI

Residential Housing Prices Analysis – Q 3 2017 Newsletter Preview

As a large asset for many, not to mention the emotional aspects of Residential Real Estate, we set off to review historical, current, and future values of Residential Real Estate across the country.

What we found was very interesting!

Something happened about two decades ago

The following key chart from our complete analysis in our coming Q 3 2017 Quarterly Newsletter depicts the change that occurred about two decades ago:

Inflation via the CPI and US House Price Index

20170507_150801156_iOS

So what happened and why?

After many decades of Residential Housing Prices closely following the price of inflation, near the turn of the century a change occurred that can be easily spotted on the comparison chart.

In our coming Newsletter we discuss the following:

  • The change that occurred
  • Why the change?
  • What does it mean for the future?
  • What lessons can be learned?
  • Current value analysis

We look forward to bringing you the full details soon, but wanted to wet your appetite with our initial information and key chart now !

Have a Great Day!

John A. Kvale CFA, CFP

Founder of J.K. Financial, Inc.
A Dallas Texas based fee only
Financial Planning Total Wealth
Management firm.
www.jkfinancialinc.com
www.street-cents.com

 

No Social Security/Pension Cost of Living Adjustment Increase for 2016

On October 15, 2015 the Social Security administration formally announced that there will be no Cost of Living Adjustment for 2016.

No Cost of Living Adjustment

The Cost of Living Adjustment (COLA) for Social Security and most other pension plans is based on the Consumer Price Index (CPI). Recall this is part of what Janet Yellen and her friends at the latest Federal Open Market Committee (FOMC) said was too low for their comfort and was used as one reason they did not increase rates.

 

CPI 1 year trailing 9-2015

 

Here is a good graph of the components of CPI, by Bonddad

 

CPI Components CO bonddad 2012

 

Believe it or not, the long term average of CPI is 2.75% – We are no where near that today !

Have a Great Day!

John A. Kvale CFA, CFP

http://www.jkfinancialinc.com
http://www.street-cents.com
8222 Douglas Ave # 590
Dallas, TX 75225

 

Flip Flop Not … What’s most important changes, frequently and fast !

If you have been following us long, you may notice we hone in on various items with sometimes excruciating  detail. Of late, interest rates may be an area you have become fatigued, but they are that important at the current time.

Not OCD, but reactive .. It changes

While it may seem at time we jump from one thing to another, we are bringing you the details of what is most important (high level as we never talk exact investments) at any given moment, in our opinion. CPI

Recent the CPI (consumer price index) or inflation gauge printed a hot number and caught our attention.

Here are a few cause and effects:

  • Head Fake (always a possibility)
  • The economy is on the mend and it is just right, Goldilocks
  • Higher interests rates: Headwinds for fixed income instruments  (mortgage, corporate, Treasury)
  • FOMC has to increase the taper speed and maybe increase rates at a faster pace
  • Commodities and  other tangible items accelerate in value
  • Pressure on Capital Markets

So while it may seem we jump around a bit, things change and importances do as well!

Have a Great Day!

John A. Kvale CFA, CFP

www.jkfinancialinc.com
www.street-cents.com
8222 Douglas Ave # 590
Dallas, TX 75225

Sniff, Sniff …. Is that inflation I smell ??

On Tuesday of this week an economic report caught many by surprise. The Consumer Price Index.

CPI gets Hot !

CPI Econoday M over M CPI  6-17-14

If this continues, this is a VERY strong sign the economy is gaining traction.

The bars tell a better story than the line in the chart !

Inflation at reasonable levels is good, especially given the alternative (deflation) ….. Now “Goldilocks/Three Little Bears” ….. not too hot, not too cold….hopefully just right !!

We will review the winners and losers of inflation, but for now let’s watch and see if it continues!

Have a Great Friday!

John A. Kvale CFA, CFP

http://www.jkfinancialinc.com
http://www.street-cents.com
8222 Douglas Ave # 590
Dallas, TX 75225

St Louis Fed (FRED) … Tax Dollars Well Used … Short Week

Last week the Federal Reserve Bank of St. Louis though its data service known as FRED (Federal Reserve Economic Data) released major updates. Being true Economic data nerds, much of the weekend was spent trolling through the enhancements and updates.

St Louis Fed, Our Tax Dollars Well Spent

Often times it is easy to throw the US’s use of tax dollars under the wasteful bus, but this cannot be said about the St. Louis Fed (FRED) expenditures. With 150,00 data series from 59 different sources, their work is superb, and best of all, free!

Here are two key data points that the FOMC is watching pulled from the new FRED site.

Civilian Unemployment Rate- FOMC GO Target 6.5%, currently 7.3%

Unempl Rate

CPI or Inflation rate- FOMC Target toward 2% currently 1.2%

CPI

Short Week Schedule

The Thanksgiving Holiday is honored on Thursday with Capital Markets being closed, and only partially open on Friday. Cathy is off on Wednesday, Donald is flying out-of-state to visit family,  and the office will be closed on Friday  … Of course I will be loosely electronically tethered just to be safe throughout the week.

Have a Great Monday!

John Kvale CFA, CFP

http://www.jkfinancialinc.com
http://www.street-cents.com
8222 Douglas Ave # 590
Dallas, TX 75225 

Inflation? Not yet….Social Security Recipients to Receive only a 1.7% Raise

The Social Security Administration has announced the cost of living adjustments for 2013, and with all the talk of inflation, some may be surprised to find that the increase was only 1.7%.  Here is a nice summary page from the Social Security Administration.

Most pension and income inflation related adjustments are based on the Consumer Price Index (CPI) including those of the Social Security Administration. Here is an interesting summary from our friends at the Chartstore.com  and the Bureau of Labor Statistics.

Take a guess what two items have actually gone down in nominal price over the last two decades? And on that note, any idea which line item has increased the most over the last two decades?  See the chart for yourself, we find it interesting what areas are hot and what are not!

So there you have it, our clothes and washing machines cost us less today than twenty years ago, and for the most expensive item, filling up our tank. Good thing our cars drive farther and longer today than 20 years ago.

Have a Super Day!

JK

214-706-4300
http://www.jkfinancialinc.com
8222 Douglas Ave # 590
Dallas, TX 75225