Hi,
While the federal government has indicated social security recipients will get no increase in their social security this year as there is no inflation; the following is an article in today's Casey Daily Dispatch from the Casey group. It is a bit revealing to say the least. Why do I suspect congress and federal employees will get cost of living increases while the seniors get screwed even though it is law they are supposed to be inflation protected?
The article follows.
regards,
5412
PS: Mod....the publisher of the report is David Galland. He has given me permission to post material from his publication as long as I name the source as the Casey Report from Casey Research. Obviously it is to his benefit hoping people will check their web site and it may generate customers for them.
Inflation in the Real World
By Jake Weber
As is often the case, there is a big difference between what the government statistics are reporting and what's going on in the real world. According to the most recent inflation reading published by the Bureau of Labor Statistics (BLS), consumer prices grew at an annual rate of just 1.1% in August.
The government has an incentive to distort CPI numbers, for reasons such as keeping the cost-of-living adjustment for Social Security payments low. While there's no question that you may be able to get a good deal on a new car or a flat-screen TV today, how often are you really buying these things? When you look at the real costs of everyday life, prices have risen sharply over the last year. For simplicity's sake, consider the cash market prices on some basic commodities.
NOTE: I could not get the graph to print so here are some highlights. It showed year over year prices and wheat is up 74%, corn 14%, Canola 36%, Heating Oil 29% Beef 18%, Pork 60%, cotton 66%....coffee 27%...you get the picture. Yeah, big brother says there ain't no inflation.......
On average, our basic food costs have increased by an incredible 48% over the last year (measured by wheat, corn, oats, and canola prices). From the price at the pump to heating your stove, energy costs are up 23% on average (heating oil, gasoline, natural gas). A little protein at dinner is now 39% higher (beef and pork), and your morning cup of coffee with a little sugar has risen by 36% since last October.
You probably aren't buying new linens or shopping for copper piping at the hardware store every day, but I included these items to show the inflationary pressures on some other basic materials that will likely affect consumer prices down the road.
The jump in gold and silver prices illustrates that it's not just supply and demand issues driving the precious metals higher - the decline in purchasing power of the dollar is also showing up in the price of physical goods. It is because stashing wheat and cotton in the garage is an impractical way to protect purchasing power that investors are increasingly looking to protect themselves with the monetary metals - a trend that is now very much in motion.
