American households suffering from high inflation despite critics

It seems whenever the Federal Reserve and the major financial institutions say that inflation is very low then that notion is parroted by many on Wall Street and on the broadcast networks such as CNBC.

This was quite evident late last month on an edition of CNBC Futures Now, which invited Peter Schiff to discuss the markets, gold and inflation. Towards the end of the interview, Mark Dow, author of the Behavioural Macro blog, made an appearance via telephone. He attempted to refute much of what Schiff was arguing by repeating what Janet Yellen has said before: there is no inflation.

During one point of the exchange between Schiff and Dow, the latter essentially said that people don’t know what they’re talking about – Schiff had cited polls that show consumers are concerned about inflation.

Of course, some news websites, predominantly the Business Insider, said Dow was victorious in the debate and Schiff got “destroyed,” despite figures to support Schiff’s arguments.

The quintessential question is: is there inflation or price inflation occurring in the United States? Absolutely, and here are some numbers to look at, which we have reported time again over the past year.

Inflation

Inflation is defined as: “a persistent, substantial rise in the general level of prices related to an increase in the volume of money and resulting in the loss of value of currency.”

With the Federal Reserve printing vast sums of money, the U.S. dollar has lost 90 percent of its value, which is still disputed by many today, including the Business Insider’s Joe Weisenthal, who opined:

“You’ve probably heard the line about how inflation has destroyed 90% of the dollar’s value over the last several decades.

It gets repeated ad nauseum by inflation truthers, gold bugs, Fed haters, and all of their fellow travelers.

The problem is that it’s almost entirely BS.”

Robert Wenzel of Economic Policy Journal was certainly correct when he suggests Weisenthal to get paid the same as a 1948 journalist ($2.30 per hour) if a devaluation in the dollar has not taken place since then. A simple visit to U.S. inflation calculator should help.

Food Price Inflation

The U.S. Department of Agriculture confirmed in a report last month that food price inflation is expected to rise this year between 2.5 and 3.5 percent, including overall food, food-at-home and food-away-from-home prices.

Between the years 2006 and 2012, food price inflation was greater than overall price inflation, according to data compiled using numbers from the Bureau of Labor Statistics (BLS) and the consumer price index (CPI).

Beef

According to the USDA, choice-grade beef hit an all-time high as it increased to a record $5.28 per pound, up from $4.91 the same time a year ago and $3.97 in 2008. A news report in the Los Angeles Times cited one restaurant owner who said the rise in beef prices is one of the primary reasons his wholesale food costs have jumped 45 percent in the last two years alone.

No wonder why dollar menus are vanishing across all of the major fast-food chains.

Chicken

Chicken prices have continued to rise faster than the overall inflation rate. The price of poultry rose 3.4 percent in February and experts are warning that the higher prices could hurt demand in the nation’s favorite meat.

Eggs

The American Farm Bureau Federation’s Semi-Annual Marketbasket Survey found that retail egg prices are at historic highs as the cost is close to $2 per one carton of a dozen eggs. Since the year 2000, the price of eggs has risen more than 106 percent.

Limes

It made headlines when several airlines announced that they were eliminating limes from its drink service because of the rising lime prices that have occurred this year. The USDA reports that the average price of a lime is 56 cents, up from 31 cents a year ago.

Pork

Pork prices are soaring 10 percent: a pound of bacon is around $5.46, up 13 percent from the same time a year ago. In addition to a virus that has killed millions of baby pigs, the production could be threatened and help prices rise even more.

Other

Throughout 2014, Americans will be paying more for nuts, honey and chocolate. When it comes to non-food items, the consumer will be doling out more for housing, mail, rent, satellite television, public transit, healthcare and, of course, taxes.

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