Food prices rise sharply

[justoffal]

As we have discussed ...excluding food and gas prices from the cpi makes absolutely no sense at all unless of course you are interested in phony numbers. Sure they add stability to the remaining numbers but that's just the point. As a consumer your wallet is not divided up with neat little compartments that store your bill money as a separate entity from your food and gas money. But be a good little ninny and do just agree with our new methods of crunching numbers now will you please?

When the Fed uses the Term inflation it has many meanings. Some of which actually argue for the use of other, more accurate terminology.

When goods and services overwhelm the money supply small amounts of inflation ( in the form of quantitative easing for instance ) can be good because the freshly printed paper actually represents something. When QE is practiced simply to pay debt....this is not good....because it directly devalues the currency in the form of inflationary pressure which is something distinctly different from the original form of QE done to keep pace with the economic demands. Yet the same word is use for both even though they are the Ying and Yang of economic policy.

To exclude food and fuel from the equation is to claim that they are totally unrelated to the currency valuation process. That is simply a flat out lie. It's this lie that you feel when you choose to eat for the week instead of making a car payment. See...to the consumer/wage earner the separation is meaningless because there is only one currency with which we are allowed to do business. Now should the Fed put out two different kinds of dollars, one for General non food items and non fuel items and another currency to go to the supermarket with and fill up you tank with...well then maybe I could give them a pass on the asinine exclusion of those two categories...but we all know that's not part of the game.

JO

 

[SteadyMercury]

Consumer Price Index Frequently Asked Questions

What goods and services does the CPI cover?

The CPI represents all goods and services purchased for consumption by the reference population (U or W) BLS has classified all expenditure items into more than 200 categories, arranged into eight major groups. Major groups and examples of categories in each are as follows:

FOOD AND BEVERAGES (breakfast cereal, milk, coffee, chicken, wine, full service meals, snacks)
HOUSING (rent of primary residence, owners' equivalent rent, fuel oil, bedroom furniture)
APPAREL (men's shirts and sweaters, women's dresses, jewelry)
TRANSPORTATION (new vehicles, airline fares, gasoline, motor vehicle insurance)
MEDICAL CARE (prescription drugs and medical supplies, physicians' services, eyeglasses and eye care, hospital services)
RECREATION (televisions, toys, pets and pet products, sports equipment, admissions);
EDUCATION AND COMMUNICATION (college tuition, postage, telephone services, computer software and accessories);
OTHER GOODS AND SERVICES (tobacco and smoking products, haircuts and other personal services, funeral expenses).

You're welcome.
-Party Pooper

 

[Mr. H.]

Where are the calls for a Windfall Profits Tax on farmers?

 

[pinqy]

As we have discussed ...excluding food and gas prices from the cpi makes absolutely no sense at all unless of course you are interested in phony numbers.

The headline All Items CPI-U includes food and energy. The All Items CPI-W used for Social Security COLA includes food and energy. The All Items CPI-U less food and energy is one of hundreds of published indexs including:

• All items less food
• All items less shelter
• All items less food and shelter
• All items less food, shelter, and energy
• All items less food, shelter, energy, and used cars and trucks
• All items less medical care
• All items less energy
• Commodities
• Commodities less food, energy, and used cars and trucks
• Commodities less food
• Commodities less food and beverages
• Services
• Services less medical care services
• Durables
• Nondurables
• Nondurables less food
• Nondurables less food and beverages
• Nondurables less food, beverages, and apparel
• Nondurables less food and apparel
• Housing

All items less food and energy is closely watched because food and energy are particularly volatile and removing them helps to look at the underlying trend.

The FED uses the PCE less food and energy, not the CPI, for its interest rates.