Inflation?

So far, the Fed’s QE campaign to generate inflation is failing miserably (as is Abe-san’s in Japan). Mish points out that Friday’s release sets a new record:

The Core PCE index of 1.05% is decrease from the previous month’s adjusted 1.17%. It is the lowest Core PCE ever recorded; the previous all-time low was 1.06% in March 1963, fifty years ago.

Wow. We didn’t have PCE in the 1930s, of course so there’s no comparison. But that’s where we are headed. Nevertheless, the most hated asset class has been beaten up recently. Even though it is now providing a nice real yield of 2.6% if you use PCE as your deflator, or 2.2% with CPI All Items.