Biggest jump in food costs in more than 36 years

Discussion in 'Politics, Religion, Social Issues' started by kavika411, Mar 16, 2011.

  1. kavika411 macrumors 6502a

    kavika411

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    #1
    Biggest jump in food costs in more than 36 years

    The good news, according to mcrain, is that you have "every right" not to eat. ;)

    The non-rhetorical question I have is this: at what point do we get concerned about inflation? I took, probably like everyone here, Econ I and II in college, but I remember little of it. With that admission, I find the don't-worry-about-inflation chant strange. It's like we are the frog, oblivious to the water being drawn to a boil, because it is done so slowly.

    Or perhaps those are just my birthday histrionics. (Yes, that indeed was me plugging my own birthday.)
     
  2. rdowns macrumors Penryn

    rdowns

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    #2
    Happy Birthday!

    As the article said, excluding those items inflation was tame.
     
  3. kavika411 thread starter macrumors 6502a

    kavika411

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    #3
    Thanks. You know you're down and out when you guilt anonymous forum posters into wishing you a happy birthday. ;)

    As to your comment/the article, I do understand that it says inflation was tame outside of these items. However - and the point of my injecting the boiling frog truism - is that it seems at some point we will run out of "excluding these items," because all items will be inflating. I know it hasn't happened yet, but heck, "excluding food costs" seems to be a big exclusion. How much of the global market is comprised of food costs? I ask because I don't know. Anyway, just a concern I have.
     
  4. fivepoint macrumors 65816

    fivepoint

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    #4
    You can't just print trillions of dollars, manipulate the markets, build false demand, and not expect prices and inflation to rise. Inflation is the only way our government sees out of this mess. They can't cut spending, so they're simply going to reduce the value of the dollar so much that it's easier to pay off our debt. Unfortunately, it's the citizenry who loses out the most, while our wages stay the same our costs will go up. Inflation is the single worst thing that can happen to the poor of this world, it's like someone reaching into their pocket and taking the money directly from them, and yet the liberals and neo-cons continue support endless manipulation by the federal reserve resulting in necessary inflation.
     
  5. mcrain macrumors 68000

    mcrain

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    #5
    Ahhh ha ha, thanks for the "shoutout." Oh my, you crack me up sometimes. :D

    I haven't heard much about this issue, but it's bound to get worse. How much demand on the world's food supply will the Japan earthquake, tsunami, and radiation (glow in the dark fish) have on food supplies and prices? Inflation is something to definately be concerned about, here and worldwide. Last time we had it, we elected President Reagan who defeated all the inflation fears by pumping trillions of dollars into the economy that we didn't have. This artificially inflated the amount of money people had, making things 'seem' more affordable.

    (edit) By the way, before FP has a chance to say it, I actually agree with him, and also recognize the problems with the spending/revenue deficit we currently have.

    HAPPY BIRTHDAY!

    [​IMG]
     
  6. iJohnHenry macrumors P6

    iJohnHenry

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    #6
    Until they determine that you are trying to commit suicide, then they force feed you.

    You don't own your body, Society does. :rolleyes:
     
  7. Gelfin macrumors 68020

    Gelfin

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    #7
    The answer is, you are asking the wrong question. The current spike in food prices is not inflation. It is another bubble, brought to you by the same players who destroyed the housing market, playing off deregulation of global commodities markets.
     
  8. hulugu macrumors 68000

    hulugu

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    #8
    Happy Birthday.

    While inflation certainly has some influence, rising food prices are primarily driven by ecological shifts, weather events, and rising economies in the third world. You also have to account for events in Egypt, Libya, and the Ivory Coast.
    Note, food prices are rising world-wide, so it's not just the US where inflation might be likely. Notice, sans food and oil, the inflation rate is lower this month than last, so I'd argue that while it's important to be watchful, rising food prices are being driven by factors besides inflation.
     
  9. obeygiant macrumors 68040

    obeygiant

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    #9
    Happy Birthday! How much was your cake?





    with all this HBD stuff, i almost though this was facebook.
     
  10. Ugg macrumors 68000

    Ugg

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    #10
    I don't believe it's all a bubble.

    One aspect that's changed in the US is how farmers get their subsidy money. It used to be that they were paid for whatever they grew and there were mountains and mountains of corn, wheat and soybeans in the Midwest. Now, with programs like CRP, they are allowed to take land out of production and get paid not to grow anything.

    Those mountains of grain were wasteful, but they did provide a buffer during years with bad harvests. Without that buffer, prices are more volatile.

    There's also the matter of floods in Oz, deathly heat waves in Russia, drought in China, etc.

    Oil also has a big impact on food prices. Fertilizer and transportation costs are a substantial percentage of the cost.
     
  11. Eraserhead macrumors G4

    Eraserhead

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    #11
    ^^ Of course to some extent its good to take land out of production.

    And Happy birthday!
     
  12. Gelfin macrumors 68020

    Gelfin

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    #12
    This is not as new as this price spike. People have been complaining about farmers getting paid not to grow things for as long as I can remember. I don't have a fully informed position on the effectiveness of subsidies myself, but their purpose is to prevent jeopardizing the food supply from the other end:

    Without the subsidies, a really flush year, never mind two or three, can be ruinous. The oversupply means all farmers are trying to move their grain. The price crashes, and those left without chairs when the music stops have not only not made money, but have to spend money to store their grain. Effectively you're kicking those guys when they're down, while expecting them to be your backstop against future famine.

    What happens is, those farmers go out of business, dump grain they can't sell when it's costing them more to store the grain than they can make off it, and they sell their land to cover their debts. Soon it's a subdivision and a shopping mall, and that farmland is gone forever. The guys who had a good year rake it in, but they have neither the surplus nor the capacity to deal with a future bad year. The Invisible Hand cannot do contingency planning. It can reward human excellence and punish subpar performance, but its response to the slings and arrows of outrageous fortune are capricious at best. Human intervention is required, and the strategy is to maintain a stable supply and a stable capacity.

    On this point you are mostly correct. Oil prices have had a huge impact, but much of oil pricing is also driven by speculation. The link I posted previously actually mentions that specifically, only to debunk it by linking to a report showing that speculation was a much larger factor.
     
  13. iJohnHenry macrumors P6

    iJohnHenry

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    #13
    Just read this article this afternoon.

    A full, balanced meal, for $4.

    What about all this dog food??? :mad:
     
  14. Lord Blackadder macrumors G5

    Lord Blackadder

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    #14
    A situation best demonstrated by the fact that prices are going up at the pump today even though the gas we're buying now was refined from oil purchased months ago.
     
  15. Sydde macrumors 68020

    Sydde

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    #15
    I think this point has been addressed on another thread. Retailers have to price to cover stock replacement more than to pay for current stock. Motor fuel retail is a pretty darn tenuous business, if you fall behind, you might not be able to make it up (well, if there are any independents left).
     
  16. Lord Blackadder macrumors G5

    Lord Blackadder

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    #16
    There aren't many. I agree with you - although part of the price hikes are simply because they can (remember the sporadic gouging after 9/11?).
     
  17. vincenz macrumors 601

    vincenz

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    #17
    I think we'll remember fondly of times when a bag of potato chips cost 25 cents.
     
  18. Sydde macrumors 68020

    Sydde

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    #18
    Plain or Barbecue
     

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