Bush Boom -- Not

MarketWatch is reporting that core inflation rose to an 11-year high in June

U.S. core consumer inflation matched an 11-year high in June, keeping the pressure on the Federal Reserve to fight inflation, the Commerce Department reported Tuesday. The core personal consumption expenditure price index, excluding food and energy, increased 0.2% for the third straight month in June, and has risen 2.4% in the past 12 months, matching the largest year-over-year gain since April 1995's 2.5% increase. . . .

Consumer prices including food and energy also rose 0.2% in June, and are up 3.5% in the past year. Meanwhile, personal incomes rose 0.6% in June, outpacing the 0.4% increase in consumer spending.

The personal savings rate rose to negative 1.5% from negative 1.6%, the 15th consecutive month of negative savings. Consumers can have negative savings by spending previous savings, or by borrowing or selling assets to support their consumption. . . .

Core inflation will likely accelerate to 2.5% in July, said Stephen Stanley, chief economist for RBS Greenwich Capital. "This is why we think that the Fed has to tighten again next week. Pure and simple. Core inflation is too high and still accelerating," Stanley said. "It is very risky for the Fed to stop hiking when inflation is still accelerating." . . .

"By now, it is evident that consumer spending is showing the strains of elevated gasoline prices and a slowing housing market, while for debt-laden consumers higher interest rates have increased the burden of monthly debt service payments," said Stu Hoffman, chief economist for PNC. "With little relief from any of these factors likely in the near term, consumers are becoming increasingly reliant on wage growth to support spending."

I'm no economist, but here is how this looks to me. American's are eating into whatever savings they may have and are buying stuff on credit. Prices are rising and wages aren't keeping up. The Fed is going to have to continue to increase interest rates. Good economy for those with money to invest, maybe, but sucks to be a middle-class American with a big load of debt, espeically if the interest rate is adjustable.