The PPI is the Producer Price Index.  The CPI is the Consumer Price Index.  The PPI reflects the price product producers are getting for their goods and services.  The CPI reflects the price consumers are paying for their goods and services.  They generally run together as lower production prices usually mean lower consumer prices.
Here again today, the fed is perplexed.  With a growing economy, and with labor market tightening, the people who control the monetary policy have continued to anticipate inflation, rises in the PPI and CPI.  However, as we have outlined, it’s not happening.
It’s a little wonky, but basically prices are NOT going up.  The Fed is perplexed.  We predicted this:

[…] The Labor Department said its producer price index for final demand slipped 0.1 percent last month, weighed by decreasing costs for services. That was the largest decline since August 2016 and reversed June’s 0.1 percent gain.
In the 12 months through July, the PPI increased 1.9 percent after rising 2.0 percent in the year through June. Economists had forecast the PPI to tick up 0.1 percent last month and 2.2 percent from a year ago. (read more)

Neither the PPI nor the CPI measure changes in food or energy costs.  Those high consumption sectors have always been removed from Fed measures.
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Well, many of us were waiting for this – and we have discovered exactly what most CTH readers anticipated, China is a paper tiger.
Last night China finally delivered the official communist government position outlining their perceived leverage over the U.S. and President Trump’s economic diplomacy and economic security platform.
China has always used The Global Times to communicate their official communist state positions.  Last night China delivered their warning; oh, you’re gonna love this:

“US needs correct logic in dealing with North Korea”.

[…] The US asks China for help when it cannot solve its problems with North Korea. Some US elites even want to urge China to claim full responsibility for the issue or they will threaten to retaliate. Under this logic, isn’t it reasonable for North Korea to attack its southern neighbor when it is under military threat from the US?
Moreover, those US elites may not have considered the leverage China has over the US. What if China restricts the usage of iPhones and the number of Chinese students to the US, or imports fewer US agricultural products? (link for more)

Now, it is critical to emphasize this is the official outlook of the Chinese Communist regime and what they perceive as their leverage over the United States.  This is the official outlook of the party apparatus behind Xi Jinping.
So let’s look at their position in sequence.
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State Department Spokesperson Heather Nauert delivers the press briefing for August 9th, 2017.  The insufferable media gnats remain fixated on President Trump’s remarks about North Korea – remarks, combined with months of created leverage, that are actually delivering results.
After ignoring all of the action President Trump, Secretary Tillerson, Secretary Mnuchin, and Secretary Ross have taken to shape the geography; and without even seeing the leverage Trump has positioned on China, Russia and North Korea; the pool reporters are floating questions from a parallel universe called ‘bizarro world’.
Seriously, questions about possibly needing a new “diplomatic direction” are ridiculous against the backdrop of the greatest international diplomatic win in years happening only a few days ago with the 15-0 UNSC unanimous vote on North Korea sanctions.
U.S. journalists are embarrassing.

President Trump responded moments ago to the statement from Senate Majority Leader Mitch McConnell about President Trump holding “excessive expectations” of congress. McConnell’s remarks were made Monday and highlighted yesterday.
President Trump responds via twitter: “I don’t think so”…
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Secretary of State Rex Tillerson has been engaged with Southeast Asian nations for the past five days during his trip to the ASEAN conference.  The issues surrounding North Korea took up most of the dialogue.  En route to Guam Secretary T-Rex holds a brief press conference aboard Air Force 2:

During a Monday Rotary Club meeting in Kentucky senate Majority Leader Mitch McConnell took questions from audience members who asked McConnell to explain why Republican lawmakers have been unable to deliver major legislative accomplishments for the president.
Senator McConnell responded by saying President Trump’s expectations are too high.

“I’d ask for a show of hands, but I know everybody’s saying, ‘been there, haven’t done anything,’ which I find extremely irritating — and I’m going to tell you why. A Congress goes on for two years. Part of the reason I think that the storyline is that we haven’t done much is because, in part, the president and others have set these early timelines about things need to be done by a certain point.”
“Our new president, of course, has not been in this line of work before, and I think had excessive expectations about how quickly things happen in the Democratic process.”

Fortunately, this ridiculously elitist and arrogant establishment tone will likely not play well. This, along with a host of other ridiculous comments and realities could doom Luther Strange in the upcoming Alabama special election. Luther Strange is the loyal Decepticon favorite of Mitch McConnell and Karl Rove.  Mo Brooks and Roy Moore are more aligned with President Trump.
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– “Walking in a Winner Wonderland” –

Two years ago CTH began discussing the ramifications to a new emphasis on the economy outlined as a possibility of candidate Donald Trump’s economic policy outlook. Within the overall discussion we walked through the anticipated changes possible if A.) Trump won the election, and B.) Trump began instituting Main Street economic policy ahead of Wall Street policy (the past 20+ years).
We discussed the new dimension that would occur between two economic engines (Main Street -vs- Wall Street) as three decades of federal policy shifted. CTH outlined anticipated economic activity in the space between the two dynamics.

Part of those discussions focused on energy costs (we see them lowering), product costs (we explained how inflation would be weird), and importantly, wage rates. It takes several months of policy emphasis, actual outcomes, before the labor market wage rates would grow. We anticipated seeing that impact in Q1 of Fiscal Year 2018, which is October 1st 2017.
Today the Job Opening and Labor Turnover Survey, “JOLTS report”, begins to show the initial stages of that wage rate increasing trend. The job market has tightened,… considerably. *Note* We are ending fiscal year Q4 (July, Aug, Sept.) and the trend within MAGAnomics is responding according to predictions. For those of us who argued these policy theories for the past two decades, these results are really cool.
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WASHINGTON – President Trump on Tuesday said one of the best ways to prevent addictions to drugs such as heroin and prescription painkillers is to keep young people from taking them in the first place.
“If they don’t start, they won’t have a problem,” he said in remarks to the media, according to pool reports. “If they do start, it’s awfully tough to get off. So if we can keep them from going on and maybe by talking to youth and telling them, ‘No good, really bad for you in every way.’ But if they don’t start, it will never be a problem.” (read more)

The Real Battle is the Battle For Your Mind…

CTH takes a different approach at significant world events.  We share the untold stories as they shake out, in real time, in granular details not noted by the MSM.  Readers here know the back-story behind the most consequential headlines when they happen.
♦We outline the policy approach and the intent of each sequential step in achieving a larger objective never discussed by the MSM; ♦we share the results as the significant horizon moments are encountered; ♦and then we share how the MSM shapes victories in the best diminishing way possible.  The latter point is specifically how the biased media shapes the mind of the consuming audience while the audience doesn’t actually notice it happening.

Cue today’s audio visual demonstration.
Everyone knows the first North Korean missile test was conducted during Bill Clinton’s presidency. That was over 20 years ago.  It would be intellectually dishonest in the extreme to think that after two decades, and with modern technological advancement, North Korea would not have missile capable nuclear weapons.  Of course they would.
Today the Washington Post, together with the “intelligence community” (note such leak and narrative partners are not accidental – they act in synergy) maneuver to diminish the hard won and historic policy and security advancement of the Trump administration -that could not be achieved by Bush or Obama policy- by pushing a “NEW HEADLINE” that North Korea already has nuclear missiles.
See what the media objective is there?
The left-wing media goal is to take the strategic policy win from the administration they oppose, and position it such that no win is actually worth celebrating.  See how they do that?
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U.N. Ambassador Nikki Haley went into her full Mrs. Rubio mode earlier today as she took credit for single-handily bringing North Korea to heel. Apparently Secretary Tillerson and President Trump assisted Mrs. Rubio in achieving her policy objectives.