Due to excessive money-printing and low interest rates by the Federal Reserve and other central banks, food and good inflation is on the rise in the United States. by Jake Towne, the Champion of the Constitution
(libertarian)
Friday, June 17, 2011
Due to excessive money-printing and low interest rates by the Federal Reserve and other central banks, food and good inflation is on the rise in the United States. The Bureau of Labor and Statistics reported that consumer price inflation as measured by the CPI-W rose 0.4% from April to 4.1% annualized. John Williams' Shadowstats, which removes government number-fudging since 1980, reported a rise to 11.2%.
The American Farm Bureau Federation announced that their basic basket of 16 foods rose by 4% from February to May. Producers like J.M. Smucker expect their prices to jump by 25% over the next 12 months. The BLS announced one month leaps of 1.5% for meat, poultry, fish, and eggs and 1% for cereal and bakery products.
Meanwhile, the BLS's Producer Price Index (PPI) rose to 7.3% annualized, which is the highest level since September 2008 reflecting in part the higher price of oil. Low-cost consumer good leader's Wal-Mart CEO Bill Simon told USA Today in March that inflation was "going to be serious" and they are "seeing cost increases starting to come through at a pretty rapid rate."
Yesterday the Philadelphia Federal Reserve Bank's survey of manufacturing producers plummeted from +43.4% in March to a -7.7% in May. A positive survey result is taken as an indicator of manufacturing expansion, and a negative result indicates a contraction of manufacturing activity.
The money-printing QE2 program by the Federal Reserve is slated to end on June 30th. While the possibility of a QE3 program is uncertain, the FED has indicated that the near zero interest rates for the FED funds rate will continue into the indefinite future. The FED meets next week on June 21-22, and the statement is expected to affect the stock markets.
Today the dollar's purchasing power is 1/1,537th an ounce of gold, a drop of about 11% since 2011 began. However, the price of a barrel of oil has dropped so far today to $93 per barrel.
The BLS's CPI index is composed of about 15% for food, 41% housing costs, 17% transportation, 4% apparel, 7% medical care, 6% recreation, 6% education and communications, and 4% for tobacco and personal care products.
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Posted By: rwilymz
Date: June 21, 2011 09:31:15 AM
Due to excessive money-printing and low interest rates by the Federal Reserve and other central banks, food and good inflation is on the rise in the United States.
You forgot other causes of future US food price inflation:
1] another attempt to create "renewable fuels" by converting food crops to a specific industrial use - which then screws with commodity prices for other similar crops, which creates false "shortages" and unnecessary price fluctuations with every related food;
2] additional government regulation of food and food processing, not the least of which was last winter's $500B concession to FDA to add their layer of bureaucratic swill upon the USDA's bureaucratic swill over food processing due to approximately 3,000 annual cases of "food-borne illness" [aka, food poisoning] serious enough to cause hospitalization. ...out of which there are maybe a few dozens deaths. Don't know about you, but I think we could hire 3,000 personal chefs for less than $500B.
Government costs money, Jake. Doesn't matter which section of the government it is.
