Prices soared in September. I thought prices went down during recessions. I thought Ben Bernanke told us that inflation was under control. Prices have risen by 6.9% in the last year. Has your pay gone up by 6.9% in the last year? But the good news from the government drones is that if you just back out the things you need to live in your everyday life like food and energy, inflation only went up by a MODEST 2.5%.
Ben Bernake is a filthy liar. He is destroying the middle class with his zero interest rate policies and Fed created inflation. His sole purpose is to enrich Wall Street bankers.
U.S. wholesale prices leap 0.8% in September
By Jeffry Bartash
WASHINGTON (MarketWatch) – The U.S. producer price index rose a seasonally adjusted 0.8% in September to mark the biggest increase since April, the Labor Department said Tuesday. Economists surveyed by MarketWatch had predicted a 0.4% gain. Higher wholesale prices were driven by a 2.3% increase in energy costs and a 0.6% rise in food costs. If those two categories are excluded, “core” wholesale prices rose a lesser 0.2%. Economists were expecting a 0.1% increase. Over the past 12 months, wholesale prices have climbed an unadjusted 6.9%. Omitting food and energy, wholesale prices have risen a more modest 2.5% in the past year.
Administrator says:
Corporate Margin Squeeze Coming As Producer Prices Soar 0.8% On Expectations Of 0.2%
Submitted by Tyler Durden on 10/18/2011 08:46 -0400
Following concerns that China will be unable to funnel liquidity into its slowing economy due to latent inflation, the last thing the world needed was to learn that inflation, in this case Producer Prices, was still running at a blistering pace in the US. Alas, that is precisely what it got after September PPI printed up 0.8% from the month before (following the unchanged print in August) and 6.9% YoY. The number was above even the highest expectation from Wall Street strategists (consensus was 0.2%). And while PPI ex food and energy was up just 0.2%, try telling that to those 99% of the population whose income is barely sufficient to buy the, you guessed it, food and energy, which rose by 0.6% and 2.3% respectively. The biggest concern is the immediate impact on margins: producers’ rising costs likely to lead to further margin shrinkage “as firms choose to absorb increasing costs rather than pass them along to consumers,” says Bloomberg economist Joseph Brusuelas. Don’t expect much respite in the CPI report to follow shortly.
Some amusing observations:
Finished foods: Prices for finished consumer foods climbed 0.6 percent in September, the fourth consecutive monthly increase. Accounting for over eighty percent of the September advance, prices for fresh and dry vegetables increased 10.0 percent.
Intermediate foods: The index for intermediate foods and feeds climbed 0.9 percent in September, the fourth straight advance. A 3.2-percent increase in prices for prepared animal feeds accounted for over eighty percent of the September rise in the intermediate foods index.
Crude foods: The index for crude foodstuffs and feedstuffs fell 0.9 percent in September. From June to September, prices for crude foods moved up 2.9 percent following a 1.4-percent increase for the 3-month period ending in June. A major factor in the September monthly decrease was a 7.4-percent decline in the fluid milk index. Lower prices for slaughter hogs also contributed to the crude foods decrease.
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18th October 2011 at 8:56 am
TeresaE says:
From Admin’s comment, “…Finished foods: Prices for finished consumer foods climbed 0.6 percent in September, the fourth consecutive monthly increase. Accounting for over eighty percent of the September advance, prices for fresh and dry vegetables increased 10.0 percent…”
No shit, this is what happens to imported products when your Central Bank & Treasury follow insane policies of spend, print, spend, print, spend some more and print some more. Then CONgress throws in a bullshit, feel good, safety extravaganza on American food producers. So, we are fucked by Benny for half of more of our “food,” then fucked by the USDA on what is left being produced here.
It is going to soon be apparent to anyone in the 99%, that sending our chicken farming to Mexico, whom then sends dead chickens to China for processing, and then China sends the dead, chemical -added “food” back to us.
I’ll bet that we are seeing similar increases in pharmaceuticals. And “our” CONgress is working on making this worse for us by screwing with China now, about a decade too late for it to have the intended consequence. Now it is going to DEVASTATE both health care and the dinner plate. Insanity.
Admin’s comment continues, “…Crude foods: The index for crude foodstuffs and feedstuffs fell 0.9 percent in September. From June to September, prices for crude foods moved up 2.9 percent following a 1.4-percent increase for the 3-month period ending in June. A major factor in the September monthly decrease was a 7.4-percent decline in the fluid milk index. Lower prices for slaughter hogs also contributed to the crude foods decrease…”
Of COURSE there is deflation in food stuffs. China is buying up our “crude” foods to either process and send back here for sale, or to keep for their own growing middle class. Our farmers are being hosed, but not to worry, they get $$ from the USDA to make up for the loss of their customers. The American food processor, from grandma making raspberry jam to Amish Country chicken to the local tamale joint is being systematically squashed under the new law. This drives up our prices even as China pays less for our produce and meat.
I see absolutely no end to this except mass hunger and ever shrinking economy as mandated insurance and/or taxes plus increasing food, energy and prescription costs are going to squeeze the majority of the 99%.
It is scary to see what is happening with food and even scarier to realize that it will only get worse as the sheep refuse to believe the truth and the theft continues.
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18th October 2011 at 9:17 am
DavosSherman says:
Inflation, according to John Williams is pushing 10%.
The Fed Moron in Chicago did a speech saying interest rates should be at 0% until unemployment went to 7% or inflation went above 3%.
What a fucking asshole. Until inflation goes above 3%.
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18th October 2011 at 9:28 am
fwiw imho says:
I’ll tell my wife to eliminate food and energy from our budget for the next year so we’re not impacted by inflation.
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18th October 2011 at 9:37 am
Welshman says:
Davos,
Believe! I bought 4 hamburger buns the other day, reg. size with a few sesame seed on the top. I don’t usually pay much attention to the cost of food, but this was a single item purchase. Three dollars for four shitty hamburger buns.
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18th October 2011 at 10:00 am
Persnickety says:
Who sells 4-packs of hamburger buns? I’ve never seen smaller than 8-packs.
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18th October 2011 at 11:06 am
Appalachian Trail Deblazer says:
QE3 is working as planned and in effect.
Thanks to the BERNAK & TIM !!
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18th October 2011 at 11:32 am
AWD says:
The government is all wise and powerful.
We need to use less energy, so inflate the prices: problem solved.
We are the most obese country in the world, so inflate food costs: problem solved.
Let our masters decide what we need and don’t need, and what we’ll pay for it.
(ctr/alt/sarc)
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18th October 2011 at 11:41 am
bigargon says:
a lot of this inflation in coming in the form of shrinkage of packaging. Example Dunkin’ Donuts “medium” coffee has gone from 14.7 oz to 14 oz ( a few years back a medium was 16oz)…
you can see this almost acrossed the board candy bars, paper towels, frozen pizzas all shrinking in size.
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18th October 2011 at 6:26 pm