Jon Hilsenrath and Justin Lahart do well to pinpoint exactly what we need to worry about in the inflation figures, which have been creeping up lately, clouding the picture for a range of policy options.

This is a nicely balanced account, I’m happy to say, since we’ve bonked the WSJ for off-kilter coverage of QE2 and the deficit, among other things.

Inflation jumped 1.6% in January, the largest increase in eight months, but beneath the numbers is a tug of war between prices for goods, including commodities, which are up, sometimes sharply, and for services, dogged by the bad economy, which are contained.

And here’s a little context:

U.S. households spent $7 trillion on services last year, accounting for 67% of total consumer spending. Because the services sector is so immense, the U.S. economy is less exposed to the cost pressures imposed by global trade than many other countries.


Of course, the problem with prices is once they get away from you, they’re hard to get back. But at least we know where the concerns are, and aren’t.

The interactive graphic allows for sorting among individual goods and services. Prices for butter and bacon are up sharply (19.6% and 11.3%) on an absolute basis as well compared to their average rates since 1998 (3.1% and 3.7%), while rates are at least slowing or down on Labor Department-defined categories like in-home health care (1.5%, vs. 2.3 %), college tuition (4.5%, from 6.3%), cable and satellite TV (0%, from 3.6%), etc.

And the quiet headline on the story, nestled below the fold…

Split in Economy Keeps Lid on Prices

… beats the four column screamer from a week or so ago…

Inflation Worries Spread

… even if it did carry a subhead disclaimer that we’re talking about in China.

Dean Starkman Dean Starkman runs The Audit, CJR's business section, and is the author of The Watchdog That Didn't Bark: The Financial Crisis and the Disappearance of Investigative Journalism (Columbia University Press, January 2014).

Follow Dean on Twitter: @deanstarkman.