Someone explain "core inflation" numbers

[WindRiverMan]

So some bright economist, please inform this poor clueless toxicologist why economists typically remove the "volatile food and energy costs" from core inflation. I know for me, once my mortgage is paid, next greatest costs are utilities and food for the family. It would seem to me that a reading excluding these very important items has little bearing on the health of the economy, especially considering our economy is so strongly consumer driven.



Enlighten me please.

[loveable liberal]

1. thom hartmann had a great economist on today that touched on that...

but I cant explain it to you.

[WindRiverMan]

2. I used to listen to Thom, but cannot anymore

only have one radio stations, and its old old country music. I need Syrius to get the talk shows, and I don't feel like paying twelve bucks a month for radio.

[mirrera]

3. Stream him on computer...

Nova M Radio or Air America

[Captain Angry]

4. Here's an article that might help.

http://www.stls.frb.org/publications/cb/2005/b/pages/down_to_the_core.html

But basically, food and fuel can spike and are left out because it would make for a poor reading. BUT when it spikes and then stays a the new level, it makes the Core Inflation measure a poor statistic.