Inflation Data Points

Today we get the CPI number. The core number is what's important: monthly and year-over-year. A stable or downtick number is good.

My dictionary purchases mentioned in my prior post again provide data points that inflation is not as large as some think. I think the price of an unabridged dictionary is down from 20 years ago. And the Oxford English Dictionary was on sale for $1000 compared to its regular price of $3000. No inflation there.

I bought some soybeans this morning at about $8.72 per bushel. The critical period for soybeans is early August when pod formation and filling occurs. The crop needs every bushel as plantings were way down as farmers planted too much corn. Carryout is very tight, even though there was a large carryover from last year's bumper crop. The beefers have been selling heavily for two days so the selling should dry up soon. This is a risky trade.

Futures are way down this AM. Maybe due to Intel margins, or due to the Bear, Stearns hedge funds being worthless and more MBS selling and liquidations, or maybe just to beefers pressing shorts again. If the CPI data is OK, I might try another long trade in the S&P futures.

PS: Bought some Nat gas - September. Selling looks dried up and August looks very hot. Risky.

PPS: Core CPI was 0.2% expected. Core CPI year over year was 2.2% which is the same as for May. That's good news. The futures point towards S&P cash around 1540 - my re-buy point. I just bought the S&P e-minis September contract.