Posted on 10/31/2013 7:15:51 AM PDT by kimtom
If you believe that there is high inflation in the United States, you are just imagining things. That is the message that the U.S. government and the Federal Reserve would have us to believe. You might have noticed that the government announced on Wednesday that the cost of living increase for Social Security beneficiaries will only be 1.5 percent next year. This is one of the smallest cost of living increases that we have ever seen. The federal government is able to get away with this because the official numbers say that there is hardly any inflation in the U.S. right now. Of course anyone that shops for groceries or that pays bills regularly knows what a load of nonsense the official inflation rate is. The U.S. government has changed the way that inflation is calculated numerous times since 1978, and each time it has been changed the goal has been to make inflation appear to be even lower. According to John Williams of shadowstats.com, if the inflation rate was still calculated the same way that it was back when Jimmy Carter was president, the official rate of inflation would be somewhere between 8 and 10 percent today. But if the mainstream news actually reported such a number, everyone .....
(Excerpt) Read more at theeconomiccollapseblog.com ...
(sarc)
The Ministry of Truth has spoken...
I’ve read the government doesn’t include the price of food and gasoline in its calculations of inflation. Of course these are the most relevant items to the vast majority of Americans.
CPI for all items increases 0.2% in September as energy and shelter indexes rise
Food inflation is caused by food stamps. It is getting to the point where it is cheaper to eat out.
Prices have risen a lot. The government can deny it all it wants. I’m used to the government lying about everything, so I’m not surprised.
But I’m sick of it.
These spoiled bastards have automatic pay raises and pension raises. Their health insurance is a separate, elite plan. Meanwhile they look down at us and give us nothing but scorn.
What goods and services does the CPI cover?
The CPI represents all goods and services purchased for consumption by the reference population (U or W) BLS has classified all expenditure items into more than 200 categories, arranged into eight major groups. Major groups and examples of categories in each are as follows:
FOOD AND BEVERAGES (breakfast cereal, milk, coffee, chicken, wine, full service meals, snacks)
HOUSING (rent of primary residence, owners’ equivalent rent, fuel oil, bedroom furniture)
APPAREL (men’s shirts and sweaters, women’s dresses, jewelry)
TRANSPORTATION (new vehicles, airline fares, gasoline, motor vehicle insurance)
MEDICAL CARE (prescription drugs and medical supplies, physicians’ services, eyeglasses and eye care, hospital services)
RECREATION (televisions, toys, pets and pet products, sports equipment, admissions);
EDUCATION AND COMMUNICATION (college tuition, postage, telephone services, computer software and accessories);
OTHER GOODS AND SERVICES (tobacco and smoking products, haircuts and other personal services, funeral expenses).
Also included within these major groups are various government-charged user fees, such as water and sewerage charges, auto registration fees, and vehicle tolls. In addition, the CPI includes taxes (such as sales and excise taxes) that are directly associated with the prices of specific goods and services. However, the CPI excludes taxes (such as income and Social Security taxes) not directly associated with the purchase of consumer goods and services.
The CPI does not include investment items, such as stocks, bonds, real estate, and life insurance. (These items relate to savings and not to day-to-day consumption expenses.)
For each of the more than 200 item categories, using scientific statistical procedures, the Bureau has chosen samples of several hundred specific items within selected business establishments frequented by consumers to represent the thousands of varieties available in the marketplace. For example, in a given supermarket, the Bureau may choose a plastic bag of golden delicious apples, U.S. extra fancy grade, weighing 4.4 pounds to represent the Apples category.
How are CPI prices collected and reviewed?
Each month, BLS data collectors called economic assistants visit or call thousands of retail stores, service establishments, rental units, and doctors’ offices, all over the United States, to obtain information on the prices of the thousands of items used to track and measure price changes in the CPI. These economic assistants record the prices of about 80,000 items each month, representing a scientifically selected sample of the prices paid by consumers for goods and services purchased.
During each call or visit, the economic assistant collects price data on a specific good or service that was precisely defined during an earlier visit. If the selected item is available, the economic assistant records its price. If the selected item is no longer available, or if there have been changes in the quality or quantity (for example, eggs sold in packages of ten when they previously were sold by the dozen) of the good or service since the last time prices were collected, the economic assistant selects a new item or records the quality change in the current item.
The recorded information is sent to the national office of BLS, where commodity specialists who have detailed knowledge about the particular goods or services priced review the data. These specialists check the data for accuracy and consistency and make any necessary corrections or adjustments, which can range from an adjustment for a change in the size or quantity of a packaged item to more complex adjustments based upon statistical analysis of the value of an item’s features or quality. Thus, commodity specialists strive to prevent changes in the quality of items from affecting the CPI’s measurement of price change.
“Food inflation is caused by food stamps. It is getting to the point where it is cheaper to eat out.”
What chu talking about Willis?
Kroger pre-cooked whole chicken in the deli: $8.99
It used to be less than $5 pre-Obummer.
Wendy’s spicy chicken sandwich, no fries and large ice tea $8.93.
These are DFW prices.
Hell, the inflation is horrible and no one notices?
This is THE WORST ECONOMY ever.
I miss those pre “fraud in the white hut” days......
They’re included, but “weighted” to hide their effects on your budget.
I like to use the price of hamburger meat as a bellwether for inflation because its price includes the price of grain, fuel, trucking, packaging, etc. For about a decade the price was generally about $1.99/lb. In the last five years, that price has escalated to $2.99, a 33% increase.
You are correct. I did some searching after I got Kabar's post and discovered that what you say is the case.
It’s actually worse than that. A price increase from $2/lb. to $3/lb is a 50% increase.
A 33% increase would be in the $2.65/lb. range.
That whole combo WITH the fries is about $7 here.
Eat out cheaper where?
It is at minimum $6-$7-$8 per person to eat at a cheap fast food place. The cheapest take out here is broasted chicken breasts at $1.89 each (no sides) or a $5 rotisserie chicken. That is our choice for those days when we are just too busy or working too late to want to cook. I add homemade coleslaw or a salad and frozen fries from my freezer or homemade rice pilaf, depending.
I can feed us more food for far longer and with much better quality for that at home. Even a menu of NY strip steak (on sale), frozen spinach souffle (sale) and frozen fries or hash browns (GV brand) with a large and varied side salad is only going to cost us $5.75/person tonight and I could cut $1 off that by making spinach souffle & potatoes from scratch.
Food inflation is caused by government regulations on farmers and processors, increased energy costs,labor costs and taxes. IMO, without government food purchase subsidies, the retail groceries might have to increase the final retail prices to make up for lost volume. Of course, we pay for that subsidy once, anyway, with taxes, but it is now a large portion of their total sales.
I don’t doubt that increased government regulation increases costs, but according to the laws of economics, more dollars creats more demand, which increases price. EBT is a specialized form of money that can only be used to buy food, thus distorting the market for grocery food items, relative to other restaurant meals. While it is still probably cheaper to cook your own meals, the difference is dropping rapidly due to the fact that you can’t use EBT at restaurants, (yet).
Of course airport food is going to be more expensive. :P
Seriously, though, if you insert special 'grocery food dollars' into the market, you increase demand, which increases price.
More demand, in an un-micromanaged economy, would result in more supply to meet the demand. Increased supply reduces price. Prices go up if more dollars chase a restricted resource or if competition to provide the resource is restricted. Costs are based on supplies plus labor, plus time plus infrastructure support plus imposed costs of doing business. It will cost more to serve stone crab claws than to serve tacos no matter how many dollars are out there for food.
Example: tomatoes are in plentiful supply in the North for 3 months a year and their cost is low. For the remaining 9 months a year, they are shipped from further away and the cost rises. The amount of dollars available for food in general and tomatoes in particular affects how many tomatoes are sold, but does not affect the demand, which is fairly constant. Eggs follow a similar pattern. Milk (cheese, butter, etc), subsidized under the Dairy Compact, varies in price geographically due to arcane government regulations that restrict the amount available for sale and no matter how many subsidized people demand it, the price is determined by other factors.
EBT can be used in some restaurants. I have seen acceptance notices in some fast food places. It may be the “here or to go” difference; I don’t know. I think you cannot buy the hot food in a deli, but if the very same hot food ends up packaged in a cooler for purchase, it is acceptable.
Yes, I imagined how American cheese went from $4.99 to $5.99 at my deli in one year.
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