Thursday, May 29, 2014

US Food Inflation Running at 22%

Chriss Street writes for Breitbart:
After five years of the federal government telling the public that despite a $3.5 trillion increase in monetary expansion, the inflation rate is below +2%, the Department of Agriculture (DOA) just warned the American public that the consumer price index for food is up by 10% this year. 
The DOA tried to blame food inflation on the drought conditions in California, but last year’s drought was worse and food prices fell by -6%. The real problem is Federal Reserve monetary stimulus is stimulating inflation. I reported in "Food Price Inflation Scares the Fed” two months ago that commodity food costs were exploding on the upside. Given the lag in commodity costs impacting prices on grocery store shelves, annual U.S. food inflation is now running at +22% and rising.


  1. So we have: Industrial metal prices, precious metals, lumber, corn, Euro are all weak.

    Oil is flat. US government bond prices are almost unchanged since late 2011.

    Coastal real estate, DC, NYC, SF real estate, stock indicies, junk debt are all strong. .

    The Fed printed a lot of money, and it looks like they got a fragmented boom. The question is will the weak assets follow the rising prices of the leaders or will the better performing assets follow the weaker ones off of a cliff?

    And will Treasury bonds and oil prices continue to go sideways like they have? If bonds don't not make new highs in the next few months and then sell off over the next year, one would think the 40 yr run for gov debt might be finished. If long interest rates finally rise, how will the better performing assets continue to the moon?

  2. That jibes with my grocery bills. Milk is nearly $5/gal and bread is almost $2. Bananas, Romaine, Cheese, bell pepper, broccoli, beef, pork--- all are WAY up over the last year.

  3. On August 15, 1971, President Richard M. Nixon announced that the United States was abandoning the gold standard and imposed a 90-day freeze on prices and wages.
    What can the FED and Obama abandon this time?

    1. Ha, will be funny when Obama puts wage-price controls on food. Better add in gasoline too, as over 4 bucks/gal. many places now.

      I raise another point, what is the impact of the expanded EBT card (SNAP) program on food prices? If more govt. funny money is chasing food items (and who knows what else), would that not also add to higher prices? And just think, the non-EBT card users pay income taxes that in part fund them, and if my intuition is correct, may well pay higher food prices as well, so they get hit twice (taxes, higher food prices). What a great country we live in!

    2. Damn true anon. Damn true.

      The US will riot when the EBT cards quit working. It will be scary.