|
|
|
|
|
US gasoline is touching $4 per gallon. Yet inflation is missing from the Consumer Price Index... (Welcome to the scam that is the CPI.)
|
|
 |
This Link is located in the Public Channel Housing Bubble and Bear Links.
Posted by ian 1 year 187 days ago (goldnews.bullionvault.com). Views: 138
Tags: inflation gold |
| Related Tags: housing bubble peter schiff economics finance credit crisis dollar |
U.S Labor Dept. apparatchiks said consumer prices rose a smaller than expected 0.2% in April, tamed by energy prices which were unchanged for the month. Utilizing an obscure "seasonal adjustment", the Labor Dept. then figured that gasoline prices actually fell 2% in April, which doesn't reflect the reality of what consumers were paying at the pump.
Furthermore, the International Monetary Fund's (IMF) global food price index rose 43% over the last 12-months, yet the US consumer price index for food only stood 5.1% higher last month from April '07.
CPI vs. Inflation Reality
Wall Street cheered the tame inflation rate this week, reckoning it gives the Federal Reserve more time to peg the Fed funds rate at 2%, jigging-up the stock market with massive money injections.
But the folks who aren't fooled by the government's propaganda on inflation are the American people, whose Dollars buy less with each passing month. The inflation tax is the great thief of middle class wealth.
For the 12 months through April, prices for US imports were 15.4% higher. Yet Wall Street economists massaged the data, and explained that wholesalers and retailers are absorbing the higher costs out of reluctance to increasing prices and driving away customers.
Should we trust the inflation statistics conjured-up by government apparatchiks, or rather, place greater faith in the depreciating Dollars and Cents that flow through the commodity markets each business-day?
According to the chart above, unleaded gasoline futures traded on the Nymex ended +12.2% higher in April, up at $2.93 per gallon.
The US Energy Information Administration (EIA), however, said average retail gas prices actually shot up 9.5% in April from March. Less than two weeks later, gasoline futures advanced another 10% to a record $3.22 per gallon, and retail prices at the pumps are closing in on $4 per gallon nationwide.
On May 14th, upon hearing the Labor Dept.'s report of a scant 0.2% inflation rate during April, former Fed chief Paul Volcker cast doubts about the way the government is measuring inflation.
"It doesn't feel quite right. I think the bias clearly is more towards higher inflation, offset by the weakness of the domestic economy," Volcker said.
"Seasonal adjustments" are one of the most useful tools that Labor Dept. apparatchiks have developed to fudge US consumer price inflation statistics.
The Bernanke Fed has a simpler model. It simply strips out food and energy costs from its inflation calculus. Either way, the Labor Dept. said retail food prices in April were +5.1% higher from a year ago. Yet the Dow Jones Agricultural Commodity Index, which measures a basket of corn, coffee, cotton, soybeans, soybean oil, sugar, and wheat, was up 40% in April from a year earlier.
View Original Article
< Prev Item | Next Item >
|
|
|
|
|
|
