{"id":393929,"date":"2010-03-05T12:43:45","date_gmt":"2010-03-05T17:43:45","guid":{"rendered":"http:\/\/www.businessinsider.com\/rosenberg-if-you-dont-think-were-staring-at-deflation-check-this-out-2010-3"},"modified":"2010-03-05T12:43:45","modified_gmt":"2010-03-05T17:43:45","slug":"rosenberg-if-you-dont-think-were-staring-at-deflation-check-this-out","status":"publish","type":"post","link":"https:\/\/mereja.media\/index\/393929","title":{"rendered":"Rosenberg: If You Don’t Think We’re Staring At Deflation, Check This Out"},"content":{"rendered":"

Some interesting observations on price movements and labor costs from Gluskin-Sheff’s David Rosenerg:<\/p>\n

As per the revised Q4 data, we now see that unit labour costs slid at a 5.9 %
annual rate, the third decline in the past four quarters.  On a year-over-year
basis, unit labour costs plunged 4.7%, which is unprecedented (the pre-revised
YoY trend was -2.8%).  As Chart 1 illustrates, there is a tight 82% correlation
between unit labour costs and the trend in headline inflation, which we can only
assume is going to fall sharply in coming months and quarters.   <\/p>\n

By way of comparison, commodity prices only have a 33% correlation to the
inflation rate — in no small part because 60% of the CPI is in services and there
is a whole host of cyclical services ranging from hotels, to recreation, to rents
that are deflating, and deflating fast. <\/p>\n

\"chart\"<\/p>\n

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