Low inflation?Higher prices?

[daves87rs]

Originally Posted By: eljefino
Originally Posted By: Steve S

Do we think the banks and insurance companies are investing the bailout $$$ into the stock market?


I think they're trying to lure people into more credit cards.

Wife and I have literally gotten 20-30 pieces of mail from Chase since Thanksgiving, trying to get us to bite on a card, and offering $100 if we did it. I finally did, to shut them up.

+1

It's crazy the amount I've got so far...

 

[JHZR2]

Energy isnt taken into account for the CPI. So that is an issue right there. Fuel prices have been pretty low until the last month or two when they have really come back up. I bet they havent been reflected yet in the CPI.

But they will be. All the fuel, fertilizer (requires hydrogen which is fuel derived), transport, etc. gets pricier and shows up in goods prices, but slightly out of phase with the commodity value changes...

 

[motorguy222]

Originally Posted By: Bill in Utah
A lot of the items that they USED to add into the mix to determine inflation has been taken out since there IS inflation but that would make certain folks look bad.

Add that plus that the US Dollar is worth a lot less (and going to be MUCH worst) and your $$ is buying less.

You can look at most items. If they are not more $$ they are less in size (take toilet paper, 1/4 of a inch shorter and more $$ BOTH at the same time) Ice cream used to be 2 quarts and now its 1.50qt but more $$.

You are seeing the beginning. It will be worst for my kids and grand kids.

Bill

I live south of Lexington Ky,most know where Lexington is.Eggs in my town are $1.69 a doz and that is at a Save-A-Lot.Gas has gone up to $3.15 gal. for regular as of 1-17-11,it went up over night from $2.99 a gal.

The price for basic needs have gone up quite a bit but there is no inflation?

 

[mechanicx]

Another trick that is done with the CPI is if a product has better performance like for example a computer with more memory this is calculated as a discount. Or if a car increases say a few hundred dollars but includes side-impact airbags the "value" of the airbag is deducted from the price and voila no inflation. Craziness, if something cost more then it cost more.

 

[Shannow]

Yeah, Oz has played the game with that.

My sister was processing ministerials (under the Cons, what's more)...Interest rates going up, and mortgages were excluded, as "the increases were reflective of economic controls"...when interest was coming down, mortages were re-included, as they "were the single most expensive item in the weekly family spend"

Cyclone, and bananas hitting $5/lb are excluded as an aberation (crop was wiped out)...they start to come down, and are back in the books.

Crazily, the CPI is calculated on the "average family spend"...across all supposed products.

Once calculated, then it's applied to booze and smokes taxes...and then not included in next year's tax round CPI calcs.

 

[Blaze]

Everything I need to buy has inflated.. health insurance, food and fuel. Things I can live without has gone down or deflated... horse hay, electronics and cell phone.

 

[Vikas]

Anybody who thinks food (grocery) prices are high in US have not lived in the other parts of world. $1.20 for dozen eggs is *cheap* by any standard or $2.50 for gallon of milk for that matter.

 

[onebigunion]

For people in the lower to middle class, greater than 90% of their expenditurers are on things that are not included in the consumer price index, thus excluded when calculating the rate of inflation. Its a completely meaninglesss number, and, as a number of people have pointed out, has been manipulated for political or economic gain (and not for you and me). How many corporations tie pay increases to the rate of inflation? I think that's also a large factor in the bogus way this is calcualted.

If food, gasoline, energy, and health care costs were included I have no doubt the rate would be well into double digits.

 

[Blaze]

Originally Posted By: onebigunion
How many corporations tie pay increases to the rate of inflation? I think that's also a large factor in the bogus way this is calcualted.
Good point!

 

[ddrumman2004]

If anyone can tell you about how the prices of foodstuffs have gone up, it's my wife!
Every time she comes home from the grocery store, I hear it!
She likes the flavor of Folger's Black Silk coffee and the only place she buy it is at a local Kroger store and even with their so called discount, the 27 oz(approx) is now at 10 bucks!

 

[buster]

The natural rate of interest for a sovereign currency issuing nation that spends in it's own currency is zero. Fraud thanks to deregulation is inflating these asset bubbles.The entire industry was rampant with fraud.

The money supply is mostly private bank credit in the form of bank loans. That and commodity speculation is where most of the inflation is coming from. Private credit collapsed at the onset of the recession so the gov't stepped in to fill the void otherwise the entire economy would have come crashing down. You cannot deleverage both the private sector and gov't simultaneously.

It's so blatantly obvious that we have had a free market looting of the economy at the hands of the FIRE sector.You can blame the gov't for not stopping this and then bailing out the perpetrators. Deregulation empowers the FIRE sector via fees,banking frauds and usury which undermines and asset strips the productive economy.In the end financial engineering which produces no wealth has replaced industrial capitalism.

 

[G-MAN]

Originally Posted By: Vikas
Anybody who thinks food (grocery) prices are high in US have not lived in the other parts of world. $1.20 for dozen eggs is *cheap* by any standard or $2.50 for gallon of milk for that matter.


Yeah, well...I don't live in other parts of the world, I live here. The "standard" I judge costs by is dictated by where I live, not where I could live or where other people live. And prices on everyday "need to live" items HERE are too [censored] high and going up.

 

[Blaze]

Originally Posted By: G-MAN
Originally Posted By: Vikas
Anybody who thinks food (grocery) prices are high in US have not lived in the other parts of world. $1.20 for dozen eggs is *cheap* by any standard or $2.50 for gallon of milk for that matter.


Yeah, well...I don't live in other parts of the world, I live here. The "standard" I judge costs by is dictated by where I live, not where I could live or where other people live. And prices on everyday "need to live" items HERE are too [censored] high and going up.


I get that all the time from friends in Europe that pay $6.00 or more per gal of gas. My friends in Europe don't have my monthy health insurance bill or my health rated doctor bills either.

 

[sleddriver]

I'd say most of what we purchase is trucked in, so rising fuel prices affect it all, clothing & groceries. Beef is fed a lot of corn and since we started blending corn with gas, anything made with it has probably gone up. In addition, I'd also bet that uncertainty in the financial markets, ie value & stability of the US dollar plays a part as well. Lots of uncertainty & fear is present nowadays.

My two cents.

 

[Smokescreen]

When the national debt eclipses its GDP, there can be no other result. Unfortunately, the national debt is still climbing at an alarming rate. The fear has legitimacy, when one looks out in the world and sees other nations in similar circumstances basically declaring bankruptcy, its an unsure outlook.

 

[buster]

That's not true. Japan's debt to gdp ratio was over 200% for over 15 years. Countries that issue their own, sovereign currency can not go broke. Greece/Ireland etc. can go broke. Inflation is the major concern and has to be offset with the proper fiscal adjustments.

All of our debt is denominated in U.S. $'s.

 

[motorguy222]

I also think that the food producers in the US have cut down on the amount of things they produce to help keep the profit margins up.

When the economy was doing better,people bought more,even if they didnt really need it.Now,most are only buying what they need and will use.

I also tend to think that companies were a little more lax in production and made more than would be sold but they still made a huge profit because supplies were cheap.That has changed,things have gone up and I think that companies have responded by tightening the supply of food.

If there is less food,prices will be higher and the food producers have a more justifiable argument for them being so.

The price of fuel may be a small contributer but fuel has been rather high for few years now.While it is starting to take a trend upward from a more stable price,I dont think fuel costs are the real problem,I think it is more of a smaller supply to make prices higher.

I was in a Kroger last week and they were out of the 18 carton eggs,it was a supplier problem.I know that there was an egg recall but if it was because of that,they would have ben out of other eggs too.I have also noticed them being out of other products as well.

Kroger isnt the only place I have noticed this,it is also happeneing at Save-A-Lot.The basics are sometimes,down to the basic if it is even on the shelf.

If you think about it,if you were a food producer and your profit margin was getting thin,you could do a few things.

1.reduce the amount of product and keep the price the same.

2.reduce the amount of product and raise the price.

3.raise the price regardless.

4.cut back your production so that there will be more of a demand for the product,that gives you oppertunity to raise prices and you seem to be justified in doing so.A smaller supply will drive up the price.It will also make for a better profit margin and less in inventory taxes.

There are other things that you could do but these are probably the easiest and fastest ways to make your profit margin better.

 

[buster]

http://moslereconomics.com/2009/12/10/7-deadly-innocent-frauds/

Please read, critique and pass it along. We need to advance these ideas. Everyone is in this boat together.

I worry about the fear mongering going on and level of systemic corruption.

People who advocate the gold standard are advocating a form of implied barterism. Goods &services in exchange for gold, a physical commodity subject to both natural and unnatural supply disruptions. Money functions as a lubricant for transactions. When people complain that our money has no intrinsic value, they are missing the larger point.

 

[mechanicx]

Originally Posted By: Blaze
Originally Posted By: onebigunion
How many corporations tie pay increases to the rate of inflation? I think that's also a large factor in the bogus way this is calcualted.
Good point!


The bogus CPI is also used to prevent rises in Social Security. I hear older people are really getting squeezed, since up to 40% of CPI calculation is based on housing costs which are usually fixed for them. Housing supposedly dropped (of course it didn't really everywhere in the real world) and this is used to make the CPI appear stagnate or deflated despite all the other price increases.

 

[mechanicx]

Originally Posted By: Blaze
Originally Posted By: G-MAN
Originally Posted By: Vikas
Anybody who thinks food (grocery) prices are high in US have not lived in the other parts of world. $1.20 for dozen eggs is *cheap* by any standard or $2.50 for gallon of milk for that matter.


Yeah, well...I don't live in other parts of the world, I live here. The "standard" I judge costs by is dictated by where I live, not where I could live or where other people live. And prices on everyday "need to live" items HERE are too [censored] high and going up.


I get that all the time from friends in Europe that pay $6.00 or more per gal of gas. My friends in Europe don't have my monthy health insurance bill or my health rated doctor bills either.


Not to mention a lot of these countries tend to have more natural food which costs an extra premium here. Besides food is not more expensive everywhere. A gallon of milk is probably 60 cents in Mexico. Granted the average income is lower, but not everyone has a high income in the US and our housing and transportation costs are high.