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As always, inflation is a tax on all things - producers and consumers. (Jun 24: Dow Chemical (DOW) CEO Raises Prices for 2nd Time in 2 Months)

As always, until the United States powers that be recognize that their reports are complete trash and that indeed inflation is surging at far greater levels than their reports indicate, we will still be in denial.

As always, the facts refute everything the powers that be say.

• Soaring commodity costs are denting manufacturing activity in Asia and Europe and the outlook looks bleak as new orders drop off in the face of rising prices, surveys showed on Tuesday.
• Manufacturing activity in the euro zone contracted in June for the first time in three years while business confidence in Asia's largest export markets is buckling and output has likely contracted further in the United States.
• Factories worldwide have struggled in the face of soaring raw material and energy costs -- oil hit over $143 a barrel on Monday.
• Meanwhile, the Bank of Japan's tankan corporate index of big manufacturers' sentiment dropped to plus 5, from 11 in March, showing their mood has not been darker since 2003. Even Japanese manufacturers, which have long struggled to pass on costs, pushed up prices in the last quarter, although not fast enough to offset a rise in costs and to keep profits growing, the tankan showed. "That could indicate more inflationary pressures in the pipeline," said Magnus Prim, chief Asia currency strategist at SEB in Singapore. "They're getting squeezed on the profit side and see no alternative but to pass on price increases."
• The picture of slowing growth and spiraling prices applied to Britain too. The UK's manufacturing sector saw output and new orders fall at their fastest rate in almost a decade. But there was no let-up in inflationary pressures with input costs and output prices both rising at the fastest rate since the series began.
• China and India are battling their fastest inflation this decade. (long predicted in the blog)
• Chinese firms warned they were passing rising costs on to consumers, which could hurt domestic demand, and struggling to export because of weak global markets, two PMI surveys showed. The measure for input prices paid by China's manufacturers rose to its highest since the PMI survey was launched in 2005. Domestic and export orders fell to their lowest since January.
• A separately published PMI from brokerage CLSA showed output prices rose at their fastest pace in four years.

Remember, it is all about China.