Non-Linguistic Inflation Framing in the Wall Street Journal

Not for the first time, I was struck by the financial media’s take on today’s CPI release. Here was how the Wall Street Journal framed it right before the data came out.

It’s not that inflation might pick up again, it’s that the “downturn” in inflation might “stabilize”. It’s not that inflation remains way above the Fed’s target, it’s that “the rate of price gains” may continue to fall.

In truth, headline CPI bottomed in June and hasn’t budged a bit (except to eke higher) over the past six months. I don’t know why this is so hard to understand.

YOY CPI Index (source: Bloomberg)

 

But hey, hey, hey! Why are we talking about headline CPI anyway? We all know that core CPI is FAR more important and is what we should all be paying attention to! Hence this graphic in the WSJ recap article of the CPI report this morning, with the core rate in bright red and the headline or overall rate in a faint dotted line beneath:


Want to continue reading this and the other 1,500+ essays you won't find anywhere else?




Already a subscriber? log in here

To learn more about Epsilon Theory and be notified when we release new content sign up here. You’ll receive an email every week and your information will never be shared with anyone else.

Comments

  1. Avatar for 010101 010101 says:

    Being a westerner, I am quite partial to suggestive images of the Dollar wearing sexy lingerie.
    Is that wrong?

    As for the Pound, well all I can say is despite the dowdy appearance and the occasional headache, its a goer.

  2. Avatar for drrms drrms says:

    Compelling analysis Ben that proves your point even more emphatically than the word-based analyses. A picture is worth a thousand words. I would guess that more automated approaches to image analysis are now within reach of ET.

  3. Avatar for kimmel kimmel says:

    Here’s the same central graphic from the same meat-and-potatoes review article on the July 2022 release of CPI data.

    I believe ”July 2022” is a typo here, should instead be “July 2023.” I point it out only because it confused me in the context of the various examples and timeline.

  4. Totally agree, and might I suggest another medium worthy of exploration: intonations of the human voice, AKA audio.

  5. Avatar for bhunt bhunt says:

    Thank you! Got it right in caption and wrong in the text. Appreciate the correction!

  6. As a daily WSJ reader, I have been sensing a distinct ‘Pollyannish’ editorial bias in the graphic displays. However, I did not take the next step the compare the tabular data to the graphics. Thanks for the insightful analysis. Is the WSJ a prominent member of the ‘Wall Street Cheer-leading Team’? Do they want eye balls on screen? Do they know how to use fear & greed?

  7. Avatar for Zenzei Zenzei says:

    Its all over the place. Headlines, ledes, contents. Same with Bloomberg.

    The finance industry needs interest rates to come down and no inflation and the main cheerleaders in the MSM are there to help them out, as always.

  8. Avatar for fxpoet fxpoet says:

    It strikes me that the most telling part of the article is that a subway token is up to $2.90! talk about paying more for worse service. I would expect hedonics there to be out of sight.

    But thank you for highlighting the ongoing BS that passes for news reporting.

  9. Avatar for Zenzei Zenzei says:

    What is this token thing that you speak of?

    Speaking of which, my wife informed me that my Metrocard will soon be a museum piece.

  10. Avatar for robh robh says:

    I remember the Y tokens from going to visit my Dad’s office in the city in the early 70s.

Continue the discussion at the Epsilon Theory Forum

7 more replies

Participants

Avatar for bhunt Avatar for robh Avatar for Zenzei Avatar for 010101 Avatar for bconn73 Avatar for lpusateri Avatar for RobMann Avatar for rechraum Avatar for fxpoet Avatar for hbalser Avatar for drrms Avatar for kimmel Avatar for KCP Avatar for kendallweihe

The Latest From Epsilon Theory

DISCLOSURES

This commentary is being provided to you as general information only and should not be taken as investment advice. The opinions expressed in these materials represent the personal views of the author(s). It is not investment research or a research recommendation, as it does not constitute substantive research or analysis. Any action that you take as a result of information contained in this document is ultimately your responsibility. Epsilon Theory will not accept liability for any loss or damage, including without limitation to any loss of profit, which may arise directly or indirectly from use of or reliance on such information. Consult your investment advisor before making any investment decisions. It must be noted, that no one can accurately predict the future of the market with certainty or guarantee future investment performance. Past performance is not a guarantee of future results.

Statements in this communication are forward-looking statements. The forward-looking statements and other views expressed herein are as of the date of this publication. Actual future results or occurrences may differ significantly from those anticipated in any forward-looking statements, and there is no guarantee that any predictions will come to pass. The views expressed herein are subject to change at any time, due to numerous market and other factors. Epsilon Theory disclaims any obligation to update publicly or revise any forward-looking statements or views expressed herein. This information is neither an offer to sell nor a solicitation of any offer to buy any securities. This commentary has been prepared without regard to the individual financial circumstances and objectives of persons who receive it. Epsilon Theory recommends that investors independently evaluate particular investments and strategies, and encourages investors to seek the advice of a financial advisor. The appropriateness of a particular investment or strategy will depend on an investor’s individual circumstances and objectives.