An exception to the inflation rule and more economist fraud.

I almost always find inflation following a rate hike.  That is not accepted as normal by the economic community, and I suspect I know why.  The bank is looking for distortions in the distribution of prices, not price hikes.

For example, in the chart to the left, in mid 2009, there was a sudden rise in the CPI for Sweden, yet I know the bank had held rates low since mid 2009.  Why the sudden spike? Did all consumer items suddenly get a common signal for a price hike?

No,Look at oil in Sept of 2009, see the jump in price? After the crash, central bankers are very frightened of sudden jumps in oil prices. In a small country like Sweden, this kind of jump would have worked its way into prices very fast. Sweden produces a whopping 4,000 barrels of oil per day, and consumes 350,000 barrels a day. Give me a friggin break.

Angry Bear on Sweden:

Ed Lambert says a price hike From Jan 2010 to Jan 2012 caused a deflation in mid 2014.  That is a lag of three years. Is this possible?  Why would economist think there is a three year lag between the two in a small country like Sweden?

 Here is Ed Lambert's two charts.   The X axis are not lined up so do the time shifting in your head. The problem with the lag scenario is simple, look at the dip in inflation in Mar 2013, then the rise, then the small dip, then a rise, then the deflation.  That motion is going to wipe out any correlation in the model between Jan 2012 and

Mar  2014, the deflation event. This is complete bullshit, this is economists cutting and pasting to get their desired effect. One cannot have prices doing the drunkards walk for two years before the sudden effect the economist is looking for. This is Krugman and Lars fitting the model via cutnpaste. Ed Lambert is seeing the same fraudulent cutnpast that Krugman has been doing with this data series for a year now.

Central bankers fear prices distortion because of the hidden path by which commodity shortages flow into the price index. They are especially worried about imports, mainly of oil, like our central banker in 2004.  And they watch for sudden housing bubbles.  So the true inflation/rate function includes both the second and first moment of the price index.