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Who is Fixing the Books at Consumer Price Index?

June 15th, 2007 | by admin |

I know that I am not alone in knowing that the cost of everything has skyrocketed the last year or so. Buying a grinder and a soda for lunch is up at the local pizza place and so is the cost of buying a burger at Wendy’s. Those costs increases are directly related to the cost of gasoline so who is kidding who?

I’m sure that you like myself have been in the grocery store lately and noticed the cost of meats going through the roof, milk is way up, bread is up, vegetables are up too. Somebody tell me from an economist point of view what is the biggest cost to a family budget other than housing? Could it be food? How does that food magically get to our local supermarkets? I’m pretty sure that Disney is tapped out on magic dust so I’m going to toss a wild guess that it is truckers and trucking companies that transport those goods.

Trucking companies are not swallowing the added cost of fuel by any means. That added high cost of fuel is added to the bread, the vegetables and the meats sitting at your local market.

Over at the New York Times they have this to say about inflation being somewhat tame…

Fuel Prices Aside, Inflation Is Tame

Published: June 16, 2007

A leap in gasoline prices pushed the overall rate of inflation higher last month, government data showed today, but consumer prices nationwide generally appear to be increasing at a consistently slower rate.

The Consumer Price Index, the government’s survey of retail prices on a wide range of consumer goods, registered an increase of 0.7 percent in May, compared with a rise of 0.4 percent in April. From May 2006 to May 2007, prices rose 2.7 percent, up from the 2.6 percent annual gain in April, according to the Labor Department.

But a separate calculation of consumer prices that excludes food and energy prices and is considered by economists and the Federal Reserve to be a better measure of inflation rose at a slower rate for the third consecutive month on an annual basis. The core consumer price index from May 2006 to May 2007 was 2.2 percent — its lowest annual reading in nearly a year and a half. - New York Times

For all this report is worth you could better wipe your back side with it than use it as a gauge as to what inflation really is. Except for Paris Hilton I’m pretty sure that we all eat. Still on the Paris Hilton angle is the fact that everything consumers buy is transported several times till it eventually reaches the stores it is purchased in. Are there actually business owners across this land that are eating that added cost of fuel? I don’t think so! That leads me to believe that this report is just crap. So who are they covering up for? Who benefits if you cut the cost of fuel out of the report? Insert your own answer here…__________

Every business in America, manufacturers, distributors, and every small business owner is passing the cost of fuel on. They have too! So why is this index kicking fuel cost out? The simple truth of that fact is that the numbers would be through the roof and that would scare consumers to death.

So the government is taking certain things that should not count out of their survey and that is okay how? It makes sense if the man in the White House is in the pocket of big oil! That topic is hush hush though as Exxon Mobil will break yet another record in the next quarterly profit report. Something to make you go hmmm?

God almighty I miss people like Teddy Roosevelt. America needs a Rough Rider President instead of a bought and paid for suit.


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  1. 17 Responses to “Who is Fixing the Books at Consumer Price Index?”

  2. By steve on Jun 16, 2007 | Reply

    Fuel isn’t the only raw material going up. So are chemicals we use to clean and fight germs and kill bugs(look at Dow’s profit!), things like copper and cement for construction. Look at an aluminum can recycler. A few years ago you got 75 cents a pound and now you can get a $1.25. IS that related to fuel cost?

    Then you have mandates by local governments from the way a building looks all the way to the way it pollutes. Those are all costs unrelated to fuel. Those costs add to the price of your burger.

    You are also forgetting the minimum wage increase. Those bottom end costs also effect the index. Somewhere along the line someone picked and washed that tomato BEFORE they served it to you at Wendy’s, not to mention Wendy’s who had to pay their worker more in a way that was totally unrelated to fuel costs.

    So are we gonna count all those things and those I am leaving out by sheer volume of time I have to write this, in the Consumer Price Index too. You can’t count what a business uses to produce it’s widget, the CPI measures the street cost of that widget not what it took to make it.

    You are too hung up on gas prices. Step back and realize we have not added refineries or refinery production in this country while we continue add people to this country. All because of the NIMBY every state has in this country, liberal or conservative.

    I am ALL FOR getting off oil. But you can’t do it over night. Gas price increases were predicted long before we got them.

  3. By Jersey McJones on Jun 16, 2007 | Reply

    Steve, the MW hike hasn’t been signed or taken affect yet.

    And refinery building has nothing to do with NIMBY and everything to do with a handful of big refinery owners who want to keep the spigot tight.

    Oil and gas are a far more ubiquitous part of our lives than you realize. Oil affects the price of almost everything in lives. Take plastics. Every plastic bag, plastic milk or juice bottle and their caps, every plastic container of every sort now costs more to produce than before you’re Failure in Chief came along. Then there’s power, manufacturing, lubrication, petroleum jellies, and on and on. All these things are more expensive.

    Inflation, though, remains generally in check because so very many of the consumer goods we purchase are produced overseas in contolled-economy third world countries whose politics you cons supposely oppose, but yet you have no problem doing business with them and therefore keeping them in control.

    The oil prices were sure to rise, yes, because supplies are slowly but surely running out (another reason why investors aren’t stupid enough to build more refining capacity). But there can be no doubt that unnecessary, stupid war and lousy diplomacy has put consider inflationary pressure on those prices.


  4. By steve on Jun 16, 2007 | Reply

    Minimum Wage hike has taken effect in California already.

  5. By kip152 on Jun 16, 2007 | Reply

    Thanks a lot Jersey, you stole everything I was going to say…

  6. By steve on Jun 16, 2007 | Reply

    Well great kip… nice to see you’d ignore half the things unrelated to oil that I mentioned too.

    Shows the idiocy and narrow-mindedness of today’s liberal activist.

    Continue to raise minimum wage and watch us chase more jobs overseas to manufacture things cheaper.

  7. By Ron on Jun 16, 2007 | Reply

    Who gets minimum wage to manufacture here, Steve? Furthermore, the minimum wage hasn’t gone up since 1996 and we continue to send jobs overseas anyway. The two have nothing to do with each other.

    Kip, when Steve says you’re an idiot, take it as a compliment.

  8. By Ron on Jun 16, 2007 | Reply

    “You are also forgetting the minimum wage increase. Those bottom end costs also effect the index. Somewhere along the line someone picked and washed that tomato BEFORE they served it to you at Wendy’s, not to mention Wendy’s who had to pay their worker more in a way that was totally unrelated to fuel costs.”

    Yes. Someone did wash that tomato, and they aren’t getting minimum wage. Those people are the illegal immigrants from Mexico.

  9. By steve on Jun 16, 2007 | Reply

    Listen sweetie… I don’t have time for reckless, shady liberal economics. I said wash the tomato and not pick it. You are basically saying that all of our food processing plants hire illegals. That is pretty freaking careless considering that it is a job that OSHA takes a good look at. Minimum Wage is $7.25 an hour California not $5.25…Ron. We just got the increase January 1st. Look it up. You also might look up that California grows most of the tomatoes and processes them (big Campbell soup factory down the road here in Sactown). So… Again when you raise wages, you effect the CPI. A cost impact not related to fuel.

    Also since we’re talking about wage increases, when real estate climbs, that puts pressure on bottom end wages in a job market. What have we seen until this year? A dramatic rise in real estate values, again not fuel related impact on the CPI.

    Why don’t you libs fly off to Cuba and get your heads examined?

  10. By Ron on Jun 16, 2007 | Reply

    “I said wash the tomato and not pick it.”

    No, sweetie, you said both.

    “Again when you raise wages, you effect the CPI. A cost impact not related to fuel.”

    I won’t argue that, but at least more people will get a living or close to living wage to deal with it. Who gives a fuck what your Hummer driving ass pays for anything, Scrooge?

  11. By Jersey McJones on Jun 16, 2007 | Reply

    Sorry Kip!

    Steve, state MWs are not going to have much net effect on national prices. In fact, most studied show they have little effect at all. One simple reason for this is the demand-side “consumption” economy (the reason your insipid supply-siders always fail). MWers tend to spend pretty much everything they make as soon as they make it. Therefore consumption rises, demand rises, and economies of scale step in and prices are reduced. So your MW theory is a load of crap. A stupid, proevn-wrong-again-and-again, stinky load of crap-doogies.


  12. By steve on Jun 16, 2007 | Reply

    I don’t drive a Hummer Ron… Again get your facts straight.

  13. By steve on Jun 16, 2007 | Reply

    Jersey… I cannot even address that. Dumb!

  14. By steve on Jun 16, 2007 | Reply

    I mean seriously Jersey:

    “In fact, most studied show they have little effect at all.”

    You wanna cite something? My family has been in small business since the mid 60’s and I gotta tell you… when minimum wage goes up, price goes up…always.

  15. By christopher Radulich on Jun 16, 2007 | Reply

    What exactly has any of this got to do with the fact that the indices do not seem to be reflexing reality. Isn’t that the thrust of this post. If anything Steve your reply seems to support the facts that the indices are measuring reality.

  16. By steve on Jun 17, 2007 | Reply

    Yep Chris, exactly… It seems the original post is just weighing way too heavy the cost of fuel. There are many, many other costs that are rising in this country unrelated to fuel.

  17. By ascap_scab on Jun 17, 2007 | Reply

    *So the government is taking certain things that should not count out of their survey and that is okay how?*

    Okay, clearly you don’t follow the markets and economics on a regular basis. Food and energy are notoriously volatile on a month-to-month reading. To take the noise out of the monthly inflation reading, the costs of food and energy have been factored out, not just recently, but for decades.

    Furthermore, each month, two numbers are published, one with food and energy and the other without. Economists and Wall Street pros prefer to use the number w/o food and energy as a better gage on the overall trends of inflation and so that is the number that gets the bigger play in the press.

    So while this might seem to you to be yet another big conspiracy, it really isn’t. There are plenty of other big conspiracies to attack.

  18. By Thuban on Jun 17, 2007 | Reply

    Your working at Wally for $ an hour. Home Depot opens and you go to work for them because they pay $$ an hour. It’s a no-brainer.

    How many young familys with kids, cars, a house…I’m talking lower middle American family, work for minimum wage?

    It’s part of the “PLAN” and the Min wage increase is an incentive for more illegal immigration!

    “The purpose of this is to enable the USA to export its inflation to the rest of the world (in exchange for IoU’s called treasury bonds, really IFUs); eg THIS is why USA doesn’t produce anything anymore, because you don’t want those $$$ to return fuelling VISIBLE as opposed to INSTITUTIONALISED inflation. This is also why you are surrendering California for AZTLAN, because your elite’s need to keep the oil sold in $$$ to preserve the $ global reserve status, the source of their (not Your) geo strategic political economic power & wealth. ”

    “`WHY don’t you halt immigration?’

    Answer, because for these useless & crazy plutocrats it is not only a Q of cheap labor but MORE importantly preventing you tearing their throats out. it is literally a matter of life & death for them to preserve control of the geo political economic & strategic agenda by selling the USA to the devil.”

    The deed is done, People! Who screwed us out of America? Was it us, evil presidents, China?

    Nothing in this country happens by accident! Nothing happens in this country without by-your-leave of CONGRESS!

    ” There are more traitors per square inch in the halls of congress than Terrorists on the streets of Bagdad!” “2008 is too damn late!


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