So yesterday we find that retail sales are FALLING. Today we find out that prices are SOARING. Sounds bullish to me. Buy stocks. Don’t miss the train to riches. We already know the government massages every data point to extract the best possible view, so when they report an inflation number like they did today, you know the shit is hitting the fan. They’ve run out of hedonistic adjustments and the other bullshit they use to fake the inflation numbers.

Even the number they reported today is a lie. Look at the supposed March and April PPI for Energy. The BLS drones are telling you that energy prices have fallen by 1.1% over that time period. Let’s add a little reality to their bullshit storyline of declining energy prices:

  • National gas prices rose from $3.52 per gallon on March 1 to $3.66 per gallon on April 30. That is a 4% increase in two months.
  • Oil prices were $101 per barrel on March 1, averaged about $102 per barrel over the two months and finished at $101 per barrel on April 30. No drop there.
  • Natural gas on March 1 was $4.60 and on April 30 was $4.85. Based on my years of financial training, I believe that is an increase.

What energy product fell? Oil, gasoline and natural gas supply the vast majority of energy in this country and the prices of those products rose from March 1 through April 30, but the government tells you the prices fell. Who do you believe?

It’s all good. Yellen assures us the 3.6% year to date PPI is an aberration and QE hasn’t had any negative impact on the lives of average Americans. Tell that to the 85 year old widows getting $0 on their savings and eating Alpo for dinner. 

Producer Prices Surge Most In Over Four Years As BLS Discovers Food Inflation

Tyler Durden's picture

And just like that, the BLS is reacquainted with soaring food prices.

Moments ago the US government reported that producer prices, as part of a newly reindexed PPI series, spiked by 2.1% from a year ago, or a whopping 0.6% surge in April, the biggest monthly jump since January 2010, and up from the 0.5% increase in March.

So what caused this surge in producer prices? Why food costs of course, which in April soared by 2.7%.

Here is the explanation for the finished goods price surge:

Special grouping, Finished goods: The index for finished goods moved up 0.7 percent in April. (The finished goods index represents about two-thirds of final demand goods, through the exclusion of the weight for government purchases and exports. The finished goods index represents about one-quarter of overall final demand.) The broad-based increase was led by the index for finished consumer foods, which advanced 2.4 percent. Prices for finished goods less foods and energy and for finished consumer energy goods rose 0.3 percent and 0.5 percent, respectively. Within finished goods, higher prices for meats, gasoline, light motor trucks, residential electric power, processed poultry, and eggs for fresh use outweighed lower prices for residential natural gas, passenger cars, and soft drinks.

It wasn’t just finished goods that was burned by food prices. Processed goods by intermediate demand…

In April, the index for processed eggs jumped 25.3 percent. Prices for ethanol, meats, gasoline, and commercial electric power also increased. Conversely, the index for jet fuel declined 5.3 percent. Prices for diesel fuel, primary basic organic chemicals, natural gas to electric utilities, and soybean cake and meal also fell

Unprocessed goods too…

The index for unprocessed goods for intermediate demand rose 0.4 percent in April after edging down 0.1 percent a month earlier. Leading the advance, prices for unprocessed foodstuffs and feedstuffs moved up 3.6 percent.


In April, a 9.4-percent jump in prices for slaughter chickens led the advance in the index for unprocessed goods for intermediate demand. The indexes for slaughter hogs, corn, soybeans, carbon steel scrap, and crude petroleum also moved up.

And so on. The good news however is that as food prices soar, and as rents hit all time highs, wages are rising in lockstep. Oh wait, never mind.


What Food Inflation?

Tyler Durden's picture

Oh, this food inflation.

Incidentally, the last time food prices spiked by this much in one month, the resulting Arab Spring wave of revolutions tumbled governments across north Africa and the middle east.

Keep a close eye on those who are not exactly participating in the global central bank cartel’s “wealth transfer effect” , and suddenly find they can’t afford food again.

Source: BLS


  1. National gas prices rose from $3.52 per gallon on March 1 to $3.66 per gallon on April 30. That is a 4% increase in two months.
    Oil prices were $101 per barrel on March 1, averaged about $102 per barrel over the two months and finished at $101 per barrel on April 30. No drop there.

    Well, you know it costs money to remove that byproduct butane from the summer mix of gasoline.

    [Not really]

  2. Oh, and to start off our drought monitoring for the year:

    Partially Parched: Half of US Is In Drought

    Half of the United States is experiencing drought, according to the latest numbers from the U.S. National Drought Monitor.

    The drought is deepest in California and the Texas and Oklahoma panhandles, according to the latest drought map, released May 8. Most of California is in extreme or exceptional drought, and triple-digit heat was returning to Texas and Oklahoma, according to Mark Svoboda of the National Drought Mitigation Center, who penned a report on recent drought conditions.


  3. What Happens When America Goes Bankrupt?

    Submitted by Simon Black via Sovereign Man blog,

    Last week in the Land of the Free, I heard a radio campaign ad for a local political candidate while in Texas.

    In the ad, he was talking about the debt and excessive government spending. And then he said something along the lines of, “We need to get this under control before America goes bankrupt.”

    ‘Buddy,’ I remember thinking, ‘America isn’t going bankrupt. It already IS bankrupt.’

    Just so that we don’t mince words, my dictionary defines ‘bankrupt’ as “any insolvent debtor,” i.e. a debtor whose liabilities exceeds assets.

    That’s the US government, by its own admission.

    As we’ve discussed before, the US Government Accountability Office (GAO) publishes financial statements each year in which they list all official government assets and liabilities.

    The liabilities far exceed the assets. Big time. And the hole is getting deeper each year.

    At this point the government’s net worth is roughly NEGATIVE $17 trillion, about 110% of GDP. That’s textbook insolvency.

    The only reason the US government is still able to service its debts is because they are borrowing money just to pay interest… and because the Federal Reserve keeps printing money to buy up US debt.

    These are hardly sustainable fiscal strategies.

    What really concerns me from my travels in the US, though, is the clear divide that seems to be forming.

    The rich are getting richer by the day thanks to all the heavy financial lifting being performed by the Federal Reserve.

    If you are in a position where you only allocate 10% of your income on living expenses, and 90% of your income on investments, you’re doing extremely well.

    The Fed is pushing up the values of stocks, bonds, luxury real estate, fine wines, art, etc. So you’re seeing 90% of your income increase by, let’s say, 10% per year.

    But the other side of excessive debt and money printing is retail price inflation. Record high prices for beef, eggs, medical insurance, etc.

    And if you’re one of the vast majority who spends 90%+ of your income on living expenses, and has (if you’re lucky) 10% left over to save or invest, you’re experiencing an entirely different phenomenon.

    If the cost of living increases by 10%, suddenly you need to spend 99% of your income on living expenses. So you either destroy your savings… or you have to reduce your standard of living.

    This is one of the greatest redistributions of wealth in history, from poor to rich, courtesy of a twisted, perverted system of central banking masquerading as capitalism.

    This is the stuff that revolutions are made of. It’s already happening around the world from North Africa to Southeast Asia. And it’s starting to spread to the West.


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