Posted on 08/06/2026 11:29:32 AM PDT by Angelino97
We all intuitively know that prices are rising faster than the Consumer Price Index (CPI) indicates. We feel the pain every time we go to the grocery store or gas station. But just how much is price inflation impacting us here on Main Street?
I started pondering this question the other day when I ran across a graph tracking the price of a can of Campbell’s Tomato Soup since 1895.
You’ll notice an interesting phenomenon. The cost of a can of soup remained relatively stable until around 1973, when it suddenly started to climb more rapidly.
And what happened in the early 1970s?
In 1971, President Richard Nixon severed the dollar's last connection with the gold standard, making it a purely free-floating fiat currency.
When he announced the closing of the gold window, Nixon said, “Let me lay to rest the bugaboo of what is called devaluation,” and promised, “Your dollar will be worth just as much as it is today.”
Well, Campbell’s begs to differ.
Since that fateful day, the U.S. government, supported by the Federal Reserve, has aggressively devalued the dollar by printing more and more of them. This would have been impossible with the monetary discipline imposed by a gold standard (which is exactly why Nixon did away with it).
According to the Consumer Price Index data released by the Bureau of Labor Statistics, the dollar has lost around 88 percent of its value since Nixon’s fateful decision. Meanwhile, the dollar value of gold has gone from $35 an ounce to about $4,000.
Of course, salaries have gone up as well, but inflationary boosts to income always lag behind prices, meaning this inflationary pressure is decimating the middle class and creating significant socio-economic shifts.
The Current Inflation Picture Is Much Worse Than Advertised
If you go shopping, you’re keenly aware of price inflation. Since January 2021, prices are up between 23.6 percent and 27.1 percent, depending on which metric you choose to use.
According to the latest CPI data, price inflation ran at 3.5 percent over the last year. That’s well above the mythical 2 percent target.
This paints a pretty bleak inflation picture, but the situation is worse than these dreary government numbers suggest.
How can this be?
Because the CPI formula is constructed to understate price inflation.
In fact, the government revised the CPI formula in the 1990s so that it understated the actual rise in prices even more.
However, the Bureau of Labor Statistics also collects and aggregates data on actual price increases. Using these numbers without all the formulaic manipulation and hedonic adjustments built into the process gives us a better sense of how much more we’re paying at the store.
I had an AI agent take 25 common items from the BLS data and calculate the price increase for that basket of goods over the last five years.
Based on this basket, price inflation is running at 29.3 percent.
The largest price increases were on the following items.
Ground coffee: 105.4% All-purpose flour: 52.8% Ground chuck: 52.8% White sugar: 50.8% Long-grain rice: 40.0%
The only price on the list lower than five years ago was bacon.
The bottom line is price inflation is worse than they’re telling you. And they’re telling you it’s pretty bad.
There are all kinds of ways to slice and dice data. We can debate the minutiae, but the trend is undeniable. You’re losing purchasing power at a rapid rate. And no matter how much Fed Chairman Keven Warsh screams about tackling price inflation, nothing will change. Even if they do get it under control (and they can’t), they will continue to devalue the dollar by 2 percent per year as a matter of policy. That means you lose more than 10 percent of your purchasing power every five years.
That’s the plan.
Therefore, you need to plan accordingly. If you’re trying to save and preserve your wealth in dollars, you’re making a huge mistake. You need to save in sound money – gold and silver. ESR
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On top of that, see my post today about Walmart short-weighing meat products. Kroger is even worse! Kentucky Ledge has a 5.4lb ham for sale that only weighs 1.84lbs. Figure the markup on that sale! It won’t be long before grocery stores have loan departments.
fake news. everything is fine.
Inflation hits every consumer differently.
Do a careful comparison of your expenditures this year vs last year, this year vs five years ago, this year vs ten years ago—you will have your own data.
If you keep old bank statements there is no need to guess.
RE: Pain of inflation....
Bill Clinton.
https://www.youtube.com/watch?v=wcp6FM5Rwks&t=1s
Slippery and slimy unlike President Trump casually saying he is not at all worried or concerned about price rises during his work to end the Iran war. Used by leftist media a lot.
It’s all fake news by the commie media, this is what Freepers are saying.
From 1990-2000 it was almost flat.
My point is folks can determine the facts for themselves.
They do not need to rely on “news”—real or fake.
Weird how I never saw one of these when Biden was in Office. Or is that because inflation was so “transitory.”
They’ve spent decades removing things from the CPI to make their increasingly depressing stats look better.
But now... with Trump and MAGA trying to actually FIX it... now they want to add all that crap back in.
Muslim voter: "Uh, that doesn't move the support needle for me."
Saying by World Series and league championship winning baseball manager Phil Garner (nickname Scrapiron).--
"No matter how big the hog is, you'd better bring home the bacon." 🐷
I've found that when inflation is high, the incentive discounts are much richer.
I price gas through the Gas Buddy app, a crowdsourcing app. I've gotten as much as 24 cents per gallon off on many occasions. The other day, I paid $3.05 per gallon.
Typical pimping of gold and silver.
Inflation to the poor and non-working class, is zero. What they get for free is about prices they have no concerns about.
When it comes to overall inflation, wages/salaries also go up to try to account for prices of goods and services.
So, the real inflation rate should be about the rise-of-prices-for-goods-and-services MINUS the rise-of-wages/salaries.
If only the prices of goods and services rose and wages/salaries didn’t also increase, the whole country would be in the poor house. Nobody would be able to afford living in the country.
I’m not an accountant, but, inflation is about everything that rises in prices over time. The price of employment is also rising for employers, and by necessity, wages/salaries have to climb too.
OK, I’m sold.
Now, when I go to my local precious metals dealer this afternoon and ask for a 10 oz bar of silver, he’s going to say that the spot price is $59.28 and that’ll be 592.80...what?
Is he going to accept my worthless old U.S. currency for his silver?
Why does he value dollars when he says that I’m a fool for doing that very thing?
OK, I’m sold.
Now, when I go to my local precious metals dealer this afternoon and ask for a 10 oz bar of silver, he’s going to say that the spot price is $59.28 and that’ll be 592.80...what?
Is he going to accept my worthless old U.S. currency for his silver?
Why does he value dollars when he says that I’m a fool for doing that very thing?
Until we can get a handle on spending, we’re in for a bumpy ride.
Anyone heard what the DSA would do about our deficit and interest on the debt?
And GDP will come in over 3%......chill
Prices are sticky. Most never come down. Does anyone here think a Democrat would deal with Affordability?
That is what the COVID takeover scheme was all about. To prove how much Americans will take. We already know how much Europeans will take.
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