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Posts Tagged ‘food prices’

America’s Hidden Inflation and How You’re Getting Screwed

Posted by Larry Doyle on March 23rd, 2010 1:47 PM |

Inflation is dead, right?

If we believe The Wall Street Journal, all we had to do was read yesterday’s edition to learn this fact. The WSJ wrote, Inflation is Dead? Long Live Long-Term Treasurys:

The Treasury Department is selling $118 billion in debt this week, just as Congress tackled a $940 billion health-care bill over the weekend, shining the spotlight on the U.S.’s hefty fiscal commitments.

Budget-deficit and debt levels are forecast to worsen: Total deficits including interest costs are set to remain above $1 trillion in the next decade, according to Barclays Capital. But longer-dated U.S. government debt is as popular as ever, even at the measly 3.689% and 4.580% yields that 10- and 30-year Treasurys are paying, respectively.

That popularity is supported by a single, compelling economic fact: Inflation is dead.

There you go. The WSJ said it, so it must be right. The policy wonks in Washington continually repeat it, so they must be right, too. Or are they? (more…)

Economic Update: Jobless Claims and Producer Prices

Posted by Larry Doyle on May 14th, 2009 10:42 AM |

Economic data released this morning included Initial Jobless Claims and Producer Price Index. Let’s dive right in!!

Initial Jobless Claims rose to 637k from last week’s reading of 601k, which was revised to 605k. The expectations for this week’s claims figure was 611k so the reading is disappointing as far as looking for stabilization within labor.

I am not surprised, though, for a few reasons:

1. we know there are going to be layoffs coming in the automotive industry. In fact, a large percentage of the increased unemployment filings came from states with heavy automotive exposure, especially Illinois.

2. as I reported in last Friday’s May Unemployment Report:

The fact that temporary government workers are factored into overall employment, in my opinion, is stretching the integrity of the report.

Thus, I am not surprised to see this week’s claims report higher than expected and I expect subsequent revisions to show higher claims as well.

In regard to the Producer Price Index, it was reported as an increase of .3% and without the volatile food and energy components as an increase of a mere .1%. No big deal, right? Well, it’s no big deal as long as you don’t eat. For those of us who actually look to consume food on a regular basis, this report is very troubling. Why?

Prices of food products rose 1.5%!! Including a rise of 43.7% for eggs, 5.2% for vegetables, 4.5% for beef, and 2.5% for pork.

Sense on Cents did receive very interesting color the other day about the state of produce in California. A reader shared:

The cost of food is on the rise faster than you can eat.
Now the feds have cut off water to the central valley and fields are not being farmed. I do not about you but ya might want to watch the price of a head of lettuce in NYC go through the roof.

Additionally, I was surprised to see a rise in prices for cars of .2% and light trucks of 1.1%. Despite the fact that car and truck sales are at depressed levels, the auto companies are in such desperate straits that they need to squeeze revenue wherever possible. That said, the asking prices of these vehicles may have risen, but who pays asking?

Please share insights on these fronts or any others from your local economies so we all can more effectively navigate the economic landscape!!

LD






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