Producer Prices over the last 3 months are increasing at an annual rate of 13%. Ben Bernanke says that inflation is well contained. Producers have two choices. They eat the increases and have significantly lower profits. Or, they pass along the increases to consumers and maintain their profits. Which do you think they will choose? CNBC and the Wall Street shills forecast increased corporate profits and strong consumer demand and low inflation. Does it seem like someone is lying?
At the earlier stages of processing, prices received by manufacturers of intermediate goods moved up 2.0 percent, and the crude goods index climbed 3.4 percent. On an unadjusted basis, prices for finished goods advanced 5.6 percent for the 12 months ended February 2011, the largest 12-month increase since a 5.9-percent rise in March 2010.” And the stunner: “The index for finished consumer foods surged 3.9 percent in February, the largest increase since a 4.2-percent climb in November 1974. About seventy percent of the February rise can be traced to higher prices for fresh and dry vegetables, which jumped 48.7 percent. Advances in the indexes for meats and dairy products also were major factors in the increase in the finished consumer foods index.”