Dial 911 if this story makes your eyes bleed (Why the economy is worse then you think)

New York Post ^ | 01/31/2012 | John Crudelle

[SeekAndFind]

The economy did horribly in the last three months of 2011.

I know that’s not what you’ve been hearing. During this past Christmas season you were first told that consumers were dying to get to the malls and shop. That turned out to be true — for a couple of days at least, while stores were desperately discounting everything they had.

Then you were told that manufacturers were having a bang-up month and that automakers were selling cars like it was the old days.

And Apple — who could forget Apple? — was selling iAnythings like they were some sort of lifesaving device and every American was in the hospital emergency room.

Last Friday the Commerce Department released its tally of business conditions in October, November and December. And it was, well, quite disappointing if you actually know what to look at.

The headline number you saw on the evening news that night and in the newspapers on Saturday was this: the nation’s gross domestic product rose at a 2.8 percent annual rate in the 2011 fourth quarter, which was better than the 1.8 percent growth in the July-September period. In the first place, 2.8 percent isn’t a good rate of growth for any year.

Take out your calculator, divide 2.8 percent by the four quarters of the year, and you’ll see that fourth-quarter growth — even if you take these numbers at face value — was just 0.7 percent.

Tepid. Lukewarm. Disappointing. Not what should be happening four years into a recession (oh, right, that’s supposed to be over) after the Federal Reserve has used all its tricks and our elected officials have bankrupted the country.

But it gets worse.

[Thorliveshere]

I am adding reality tv and American Idol to that list.

I'd go further and add the internet. Wasn't there a book a few years back called "Amusing Ourselves To Death?" that described this? I hadn't actually read it, but a friend told me about it.

[LibertyRocks]

I’m racking my brain trying to remember where I read that as well (somewhere here on FR). I remember reading where some talking heads were telling us there WAS no inflation in food prices (like I believe THAT! LOL - grocery bills don’t just jump an average of $50.00 a week for nothing, and some people might not notice and increase of $.20/per product, but I do - it’s gradual, but prices at ALDI for instance have gone up an average of $.25+/item in the last 3-4 years).

[USS Alaska]

Yes it is true. They were removed due to their volatility some time ago.

Food and energy were removed so the fake rates reported would not show a true rate of inflation for substances that regular people use the most.

The rate of Social Security cost of living increase has been based on inflation, so if you disregard the two components that most people require you can downwardly distort the rate.

[jpsb]

Sadly the only candidate that knows what the problem is and how to tackle the problem is labeled a kook. We will see what a kook he is in a year or two when gas is $20/gallon, food unavailable, unemployment at 50% and our inner cities are no go zones.

[meatloaf]

It’s true.

[LibertyRocks]

Scariest thing I’ve seen is that in my area all of a sudden we are having ARMED ROBBERIES at bars and such. Of course, risking flames here, but to be non-politically correct, there are a lot of low-income minorities that have suddenly decided in the last 2 years that our town is the place to move to(????) - we’ve had an unbelievable influx of people and their teenage sons, and if I didn’t know better I’d assume that ALL of these families are on some sort of assistance - and if they aren’t their moves were most likely prompted by these kids being involved in crime and their parent(s) hoping to get them out of it (HINT: if your kid is holding up stores and gangbanging at 15 y.o. moving to a rural city isn’t going to “help” you just bring the problems WITH you to those who didn’t HAVE those problems before). Also, don’t these “kids” realize they stick out like sore thumbs to the neighbors AND the police here? Thankfully, the police pretty quickly broke up the armed robbery “gang”, but I wonder what’s next? We already had them breaking up an underage call-girl/drug ring!?!? (Yes, I know we’ve had prostitution and drugs in this town before - but, you wouldn’t have KNOWN about it before as people were very discreet about it and most definitely didn’t involve UNDERAGE girls).

Honestly, I wonder about the younger generations (of all “classes” and ethnicities) who have NEVER had to save, or wait for anything in their lives (thanks to mommy and daddy’s credit cards). It’s a rude awakening if you’ve never heard of the word “budget” before. With these kids’ entitlement attitude it wouldn’t surprise me at all if their desperation of “want” gets to be too much and they decide to “have” these things right NOW.

I was “spoiled” with my teen years occurring in the late-80s but even then nowhere near some of my peers in my area. So many of my peers STILL haven’t hit “reality” IMHO - not when they are inheriting their parents’ (now $4-500,000) homes with no mortgage! We’re hitting our 40s now, and some are STILL totally clueless - it’s frightening really.

[ZX12R]

I’m racking my brain trying to remember where I read that as well (somewhere here on FR). I remember reading where some talking heads were telling us there WAS no inflation in food prices (like I believe THAT! LOL - grocery bills don’t just jump an average of $50.00 a week for nothing, and some people might not notice and increase of $.20/per product, but I do - it’s gradual, but prices at ALDI for instance have gone up an average of $.25+/item in the last 3-4 years).

I've also noticed in the last few years, that food producers are cleverly trying to minimize your noticing of the inflation in their product prices. There are literally many, many examples, but I'll give you just one, and this example is being practiced on practically all food stuffs. We have always bought dog food by the standard 20 pound bag. As the price started rising, I noticed that not just the price was going up, but also the weight normally sold was going down, so it looked like slower inflation. And it still looks like an average 20 pound bag if you just look at it. The last bag of dog food I bought was now down to 16.6 pounds. The same with breakfast cereal and just about every product. The amounts/weights are dropping while the prices are going up. So, while the average food bill per shopping event has been going up, the actual cost of food per week is rising even more than that.

[redgolum]

I agree, but you have to ask yourself one simple question.

Can we the people actually change anything?

[sportutegrl]

I can add to your evidence. The local WalMart has been shifting/removing aisles for some time now. It makes the shelves and store look full with fewer goods. Last week I went in, (I hadn't been in since Christmas), and I was shocked. There were vast open areas, like too many aisles had been removed. The remaining aisles had empty shelves -- something I rarely see at this Wal Mart, which had always taken care to remove aisles and reorganize shelves so they look full and inviting with less stock.

Over at the Target, the story was a huge open area in the back of the store with nothing, nothing in it at all. The Target was using a neat trick to hide empty shelves: they would put out boxes that would take up the space of two or more rows of shampoo for instance. The boxes were printed with ads for a certain shampoo, but they clearly took up shelf space, making the shelf look full with less shampoo.

Both Wal Mart and Target had devoted much less space to 'seasonal' than previous years. For three years now, I have been observing how much space is devoted to each season's merchandise. The year Obama was elected there were two whole aisles devoted to Halloween candy, for instance. Now there is less than a half of one side. Valentine's Day shows a similar drop off. And I haven't even touched the story at the Mall.

[Calvin Locke]

I used to solo autocross, (which is basically setting up a timed race
course with small pylons in a rented parking lot...), and I was
next to go for a run, and they held me up for another car.

They told me he was getting married later in the day, and he wanted to
get his runs in, so as soon as the waiting period for the tire
cooling was up, they let him go next.

[Mr. Jeeves]

This is very bad news for people that think we can grow our way out of debt.

I hope no one still thinks that, since debt has outpaced growth since 1983. We've been faking it for almost three decades. Reaganomics would only have been workable with politicians who were willing to restrain spending - and our system does not offer them any rewards for doing so.

[Mr. Jeeves]

Can we the people actually change anything?

Not at the ballot box - but if a significant percentage of the productive population got disgusted enough to stop paying taxes...

[jpsb]

Did we have growth in 1983? Hello. And oh by the way a how much is your 2012 dollar worth compared to you 1983 dollar?

[jpsb]

I decided to answer my own question. A four 1983 dollars would almost buy ten 2012 dollars.

[Sequoyah101]

If the price just stays the same but the weight goes down:

25% inflation= 4 lbs of sugar instead of 5 lb

20% inflation = 16.6 lbs of dog food instead of 20 lb

I also see it at fast food places and restaurants. The average menu item went up about a dollar at one of the places we frequent for lunch 7.95 instead of 7.25 = 10% inflation straight way.

FDA is strangling poultry producers. Just like the orange juice from Brazil with insecticide in it... FDA won’t allow us to use maintenance drugs on poultry flocks but there are no controls at all on what is done in areas like Chile who are now producing chicken to send to us.

We are burning corn in mandated ethanol and the price of feed for our stock is going through the roof. Expect more grass fed beef that will cost more because you produce less beef with grass instead of grain.

obastard and his minions and handlers are wrecking each and every phase of your life.

[ZX12R]

We are burning corn in mandated ethanol and the price of feed for our stock is going through the roof. Expect more grass fed beef that will cost more because you produce less beef with grass instead of grain.

That's another thing that makes me mad as hell. Steaks are pretty much priced out of our budget. It's not that I can't really afford it, It's that we just are not willing to pay $15.00 for a small decent steak in the grocery store. AND I LOVE STEAK, DAMMIT!!!!!!

[1rudeboy]

It's important to note that shrinking package sizes is one way producers hide price increases, but that it still counts as "inflation" in the goverment figures.

If the government food basket contains 16 oz. of coffee (for example), then the government extrapolates the price if the package shrinks to 14 oz.

In other words, it depends on perspective. What is "inflation" to you may not be "inflation" in the statistics.

[1rudeboy]

I should’ve said that, “what is inflation from your perspective (because the package is smaller but the price remained the same), is inflation to the government (because the per unit price rose).”

[Grumpybutt]

We’re right there with you.

[jpsb]

chuck roast make a very good steak. Just picked up 4 roasts yesterday at 2.99 lb.