Food Price Inflation Calculator
by Richard Daughty
The Daily Reckoning
by Richard Daughty: Buying
Silver While Itís Still Relatively†Cheap
of the Mises Institute writes, The
price of everything seems to have skyrocketed. Only housing, the
dollar and inflation-adjusted income are negative.
interrupt to wittily say, Well, housing is going down because
nobody wants to buy a still-over-priced-yet-even-lower-quality house
that now needs painting, a new water heater, some leaky things fixed
and a new roof, especially now that inflation-adjusted incomes are
silence at my rudeness was all I needed to continue, And the
ridiculous fiat dollar is going down in purchasing power because
the foul Federal Reserve is creating So Freaking Much Money (SFMM)
that, vis-à-vis other dirtbag fiat currencies of other dirtbag
countries running budget deficits, the dollar is going down in value
faster than they are because the Federal Reserve is creating more
new money than all the rest of the worlds dumb-ass, dirtbag
central banks put together!
everybody is completely stunned by the way I just barged into the
conversation with one of my patented Stupid Mogambo Remarks (SMR),
I, thus emboldened, powered forward by thoughtfully stroking my
chin as if contemplating something profound, whereupon I go on,
my voice rising in a crescendo of pain and outrage, But if
you calculate all prices in ounces of gold, you will find that prices
will have actually gone down! Im not sure exactly how to prove
it, but this has to mean Were Freaking Doomed (WFD)!
Mr. Thornton is not sure how to calculate it, either, but is perhaps
suggesting that the horror may be found in the fact that World
food and commodity prices are up 28% over the last six months.
I was surprised
that I did not edit his remarks to end with at least one exclamation
point, and also surprised at his use of a 6-month time-frame, instead
of annualizing it, at least in some simplistic linear manner that
a dolt like me can understand.
In doing so,
he unwittingly provides an opening for Showoff Calculator Man (SCM),
as I happen to be an absolute whiz at multiplying numbers by 2!
calculator where my mouth is, I quickly crank out 2 X 28% = 56%
inflation! See? I CAN do it!
On the other
hand, 1.28% X 1.28% = 1.64%, which would seem to be a massive 64%
annual inflation when compounded, even more so than the simple 58%.
ignores me, and goes on, Higher food prices set off the revolutions
in Tunisia and Egypt and the mass protests in countries like Algeria,
Jordan, Yemen, Bahrain and Iran. People in these countries buy more
unprocessed foods and spend a much higher percentage of their income
on food, so they have been severely impoverished by Bernankes
being an American, all I really care about is how it affects me,
an American, and American prices, and how in the hell I am going
to afford higher prices on my American income which has, as he said
earlier, gone down when inflation-adjusted.
In that regard,
Managing Editor here at The Daily Reckoning notes, Wholesale
prices jumped 0.8% in January. The producer price index (PPI) has
now jumped 3% over the last four months. And no, thats not
an annualized figure.
Calculator Man (SCM) comes to the rescue, and multiplies 3 times
3% to get 9% inflation, which IS an annualized figure, and more
than 9% inflation when compounded, and which is scary enough to
send me running, running, running, like the paranoid little weasel
that I am, to the safety of the Mogambo Secret Bunker (MSB).
I was hurriedly
shutting the bunkers door when I heard Mr. Bowman go on, Note
that the PPI headline number is for finished goods
stuff thats ready to be sold direct to consumers. In the category
of crude goods, the figures are far worse up
3.3% in January, and up a staggering 15.8% over the last four months.
The last four
months! Thats almost 48% inflation a year! Man, if ever there
was a time to buy gold, silver and oil, this is it! Whee! This investing
stuff is easy!
Richard Daughty (Mogambo
Guru) is general partner and COO for Smith Consultant Group, serving
the financial and medical communities, and the writer/publisher
of the Mogambo Guru economic newsletter, an avocational exercise
to better heap disrespect on those who desperately deserve it. The
Mogambo Guru is quoted frequently in Barrons, The
Daily Reckoning, and other fine publications.
© 2011 Richard Daughty
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