Crude Oil and Motor Fuel: Fair Price Revisited
In April 2009, we introduced a model representing the evolution of motor fuel price (a subcategory of the consumer price index of transportation) relative to the overall CPI as a linear function of time. Under our framework, all price deviations from the linear trend are transient and the price must promptly return to the trend. Specifically, the model predicted that “the price for motor fuel in the US will also grow by 50% by the end of 2009. Oil price is expected to rise by ~50% as well, from its current value of ~$50 per barrel.” The behavior of actual price has shown that this prediction is accurate in both amplitude and trajectory shape. Hence, one can conclude that the concept of price decomposition into a short-term (oscillating) and long-term (linear trend) components is valid. According to the model, the price of motor fuel and crude oil will be falling to the level of $30 per barrel during the next 5 to 8 years.
PPI of Durable and Nondurable Goods: 1985-2016
It was demonstrated that the difference between the PPI of durable and nondurable goods can be predicted at a several year horizon. The prediction consists of three steps. First, we show that the difference between producer price index for durable and nondurable goods is characterized by the presence of sustainable mid-term trends. Second, the evolution of the difference is predicted at a five to ten-year horizon as an extrapolation of the previously observed behavior. Third, considering the overall PPI to be practically constant over the next decade one can expect an overall decline in nondurables price and equivalent increase in that for durables.
Representation of systems disturbed by wide band noise
In this paper, a method of handling and working with wide band noise is developed. We represent wide band noise as a distributed delay of white noise and use it to reduce a nonlinear system disturbed by wide band noise to a nonlinear system disturbed by white noise. An application of this reduction to a nonlinear filtering problem under a wide band noise disturbance is discussed.