Core CPI is important because this is what the Federal Reserve looks at to decide whether or not to raise the Fed funds rate. The Fed uses the core CPI because food, oil and gas prices are so volatile and the Fed’s tools are so slow-acting.
REMEMBER the FED does not include food and energy costs in their INFLATION model!
Yet, the FED are “SURPRISED”, again and again, at how low the inflation is and their policy is to increase inflation because of their fears of DEFLATION.
Many people are not aware that inflation and deflation can and often does coexist, however deflation is a major effect that would destroy the control of the central planners and their monetary system…
Thus “full steam ahead” with the inflationary, hidden tax increase, policy, from policy makers.
Food Price Inflation Is Terrorizing Your Grocery Bill
Posted 28 March 2014 by Jason Simpkins http://www.outsiderclub.com/food-price-inflation-grocery-bill/883
Forget the “Milk Cliff.”
We’ve fallen off the “Cattle Cliff.”
Americans are paying record high prices for beef right now due to a national cattle shortage.
The overall average retail price of beef was $5.28 per pound in February, compared $4.91 in 2013 and $4.63 in 2012.
In all, beef prices have surged 22% over the past year. For the most part, that increase has been absorbed by retailers, but now it’s seeping through to the consumer.
Cattle dealers are blaming the cold weather and drought for the cattle shortage. And beef is just one of the foodstuffs that’s been affected.
- Retail pork prices are up 6.8% in the past year to an average of $3.73 a pound.
- Poultry prices are up 4.7%.
- Orange prices are up 3.4%.
- Strawberry prices are up 12%.
- And the average price of a gallon of milk went from $3.46 in October to $3.56 in February.
Overall, grocery prices rose 0.4% in February, and experts expect an increase of as much as 3.5% for all food prices by the end of 2014.
We can’t blame it all on the weather, though.
A surge in exports to China and other Asian nations has played a part, as well.
That’s especially true of pork.
U.S. pork exports to China surged from about 57,000 metric tons in 2003 to more than 430,000 metric tons in 2012.
Soybeans are another big draw. We export about 57% of our domestic soybean crop overseas, and about 30% goes to China, raking in roughly $10 billion.
And this trend is quickly accelerating.
As more and more Chinese citizens urbanize, and wages rise, they’re going to consume even more food. They’ll also move away from rice and vegetables to more expensive, meatier diets.
China is expected to spend about $1.75 trillion on food in 2050, roughly double the $870 billion it spent in 2009, according to “What China Wants,” a newly released study by the Australian Bureau of Agricultural and Resource Economics and Sciences.
The United States is by far the world’s biggest food exporter, with agricultural exports totaling $145 billion in 2012. About $25 billion of that went to China.
Get Ready for Rising Food Prices
As Congress enters a meeting on the farm bill, each side already has its own ideas all planned out…
Monsanto’s Government Connection
How deep into the government do Monsanto’s roots go? Its receiving of the 2013 World Food Prize might give some indication…
Major Water Shortages Out West
Here at the Outsider Club, we’ve written a lot about resource shortages, and this one is a pretty big one. Right now while the East Coast is pounded with heavy snowfall, the West Coast is facing drought conditions.