Inflation or deflation? Jesse’s Cafe Americain says “selective inflation”

Jesse’s Café Américain: What is a “Nominal” Stock Market Chart Versus a “Deflated” View?:

“Oh this is all very well and good Jesse, but when I go to the grocery store or to the gas station or the convenience store to buy my instant Lotto tickets I pay in dollars and not gold or euros.”

Yes, but when your suppliers go to buy their goods that are imported, they pay in dollars that are depreciating. You know that some prices are moving higher despite slack demand overall. This is what we call ‘selective inflation.’ This is how it starts.

P.S. Something related to this that I’ve noticed is the rise in Nikon lens prices over the past year. Nikon is based in Japan, so everything they make is ultimately denominated in yen. Even with a lousy economy and slack demand, Nikon lens prices in the U.S. have increased due to a dollar that’s deteriorating relative to the yen. This is the NexTag price chart for the Nikon 70-300mm VR showing rising prices (red is maximum, black is median, blue is minimum):

Previously – Inflation or deflation? Noriel Roubini says “deflation now, but maybe big inflation in a few years”