[squiffy]

First of all, the distinction between CORE inflation and energy prices is an artificial distinction, which I presume is drawn to determine how persistent long term price changes are.

If oil prices jump for one day, that won't necessarily produce price rises that are transferred to other products by businesses with pricing power.

But you cannot ignore the short term effect of higher oil prices on the spending power of Americans and businesses. If you have to spend more money on gas and transportation, you have less money in your budget for food, clothing, entertainment, etc.

Of course, you can also reduce your driving. So it's really a question of what consumers will do less of. In theory, they should buy less because oil prices are higher. If their driving is essential, and their demand for gas is highly inelastic, then they should by about the same amount of gas, pay more for it, and have less left over for other things.

You are saying that INFLATION is NOT causing the economic slowdown. But you are ignoring the INFLATION in oil and energy prices, which are a commodity which Americans purchase.

It is precisely that inflation in prices for a key commodity that is draining Americans' budgets and reducing the volume of gas they can buy, and or reducing the other items they can purchase, thereby slowing economic growth.

You are relying on the ARTIFICIAL distinction between CORE inflation and energy prices to cloud your characterization of the economic cause and effect.

Oil and energy are a key good. For purposes of analyzing economic growth, you need to put energy prices back into the analyis.

If you only use the CORE inflation rate, then you are ignoring energy and oil. If that is the case, there is no way to explain the slowdown in the economy that you are predicting.

If CORE inflation is down and nothing else matters, then people should be buying more and the economy should be growing faster.