Hyperinflation has arrived

[Phil Thien]

I just paid $1.31 for a regular size bag (1.69 oz.) of plain M&M's.

According to the CPI inflation calculator, they should have been about $.53 (because they were $.10 back in 1972).

And to add a little insult to my injury, they melted in my hand a little bit.

[Moses Yoder]

My dad was wealthy when I was born. I am not sure how much money he earned, maybe $10 a day, but that $10 would buy a heaping cart full of groceries. He died dirt poor, living on his and mom's SS check which combined totaled $1100 a month. They lacked nothing but still I would like to see our family try to live on that even with no house payment.

I think if you trace it, inflation is tied to the desire to earn more money.

[Michael Weber]

I read somewhere years ago that in the case of food the CPI took into account replacing items in their "basket of goods" with cheaper or generic alternatives. Don't know if that's actually true but I have never believed the official inflation index data especially if it's open to manipulation. Also no idea if it accounts for the shrinkage of food items over the years. My wife came home from the store last week with a box of Blue Bunny ice cream bars. I have no idea what she paid for them but we were both shocked at how small they were compared to the same product last year. Product shrinkage has been a pet peeve of mine for many years.

[Scott Shepherd]

I just paid $1.31 for a regular size bag (1.69 oz.) of plain M&M's.

According to the CPI inflation calculator, they should have been about $.53 (because they were $.10 back in 1972).

And to add a little insult to my injury, they melted in my hand a little bit.

I was at a trade show in Orlando last week and went into a M&M store. They had a whole wall of different colors and flavors of M&M's. I grabbed a bag, stopped well below the red line the guy said was about a pound, went to counter, cost me $15. Apparently they were $12 a pound and the red line was a long way off :) But the Raspberry M&M's.......Oh my!

[Kev Williams]

And I thought this was going to be a thread about putting 80psi of air in your tires to get better gas mileage... ;)

But I do have a pet peeve about the actual topic:

Printer ink...

I would LOVE to know why my Canon inkjet printer, with 2 blacks, a yellow, cyan and magenta cartridge, can only print 10 pieces of paper before one of them is needing to be changed?

And the price to replace a cartridge- There's 3785 milliliters in a gallon. There's 15 ml ink in a $15 cartridge for my printer. Deduct $2 for the cartridge, that's $13 for every 15ml of ink, so 3785/15=252.33, x $13 = $3280.34 a gallon for printer ink...

I'm kinda thinkin' the stuff don't cost near that much to make!

[Brian Elfert]

I just paid $1.31 for a regular size bag (1.69 oz.) of plain M&M's.


How does the number of ounces of candy compare to 1972? A lot of the candy has gotten a lot bigger over the years.

The price of small snack items like candy is ridiculous at some places. I was at some sort of convenience store the other day and noticed a king size candy bar was almost $2. A tiny snack size can of Pringles was $1.89. I can buy a full sized can of Pringles for $1.50 at Target or Walmart. Candy is also cheaper at Target or Walmart.

[Mark Bolton]

And I thought this was going to be a thread about putting 80psi of air in your tires to get better gas mileage... ;)

But I do have a pet peeve about the actual topic:

Printer ink...

I would LOVE to know why my Canon inkjet printer, with 2 blacks, a yellow, cyan and magenta cartridge, can only print 10 pieces of paper before one of them is needing to be changed?

And the price to replace a cartridge- There's 3785 milliliters in a gallon. There's 15 ml ink in a $15 cartridge for my printer. Deduct $2 for the cartridge, that's $13 for every 15ml of ink, so 3785/15=252.33, x $13 = $3280.34 a gallon for printer ink...

I'm kinda thinkin' the stuff don't cost near that much to make!


And what kills me is why when you print in b&w or grey scale only does the color ink drop as well. I know my printer does periodic automated cleaning which uses a little ink but it seems odd fornmy printer at least.

[William Adams]

For ink, you should either refill the cartridges, or buy an ink tank system or switch to a laser (though HP's new PageWide system is looking quite affordable and tempting).

For the CPI, yes, it's constantly adjusted --- sometimes to take into account people transitioning from owning typewriters to computers, but other times, it's to have people buying cube steak instead of sirloin when times get hard.

[Brian Elfert]

The CPI is also adjusted for things like cars getting more and more features. Is it fair to compare a 1980 Honda Civic with no features to a 2014 Honda Civic that has auto transmission, power lock/windows, and other new features when figuring inflation?

[Jack Lemley]

I believe food and fuel price increases are backed out of the inflation numbers. If they weren't inflation would not be so low now since food has gone up over 20% since the first of the year.

Jack

[Michael Weber]

I believe food and fuel price increases are backed out of the inflation numbers. If they weren't inflation would not be so low now since food has gone up over 20% since the first of the year.

Jack
from the government cpi faq page http://www.bls.gov/cpi/cpifaq.htm
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)

[Brian Elfert]

I believe food and fuel price increases are backed out of the inflation numbers. If they weren't inflation would not be so low now since food has gone up over 20% since the first of the year.


Certain food items have gone up a lot in price, but I don't think food has gone up nearly that much in general. I know I'm not paying anywhere close to 20% more for my groceries, but I don't buy that much beef or pork which have gone up a lot.

Up until a few months ago I was buying large packages of precooked bacon at Costco regularly. I think I paid as little as $9.49 a package and as high as $13.99 or $14.99. At one point the price was going up 50 cents or a dollar every two weeks. Strangely enough sometime last summer or fall the price dropped back to $11.49 or $11.99. (Size of package never changed.) I have no idea what it costs today, but I bet it is really high now.

[Kev Williams]

In 1971 the base price for a Ford Pinto was $1919, and a 27" TV was $600-- Now, disposable cars are $13,000 and if you look hard you can find 55" TV's for less than $300...

I still remember in 1973 when a hot-shot Kirby salesman showed off his new $1500 watch-- Gold, with just a black window that flashed the time in bright red digits when you pushed the button. It WAS the coolest thing we ever seen! Didn't even have a day/date button.

And even tho many electronic items are dirt cheap these days, it never ceases to amaze me that, even at the peak of the recession, there was no shortage of people who would wait in line for DAYS to spend $500 for an Iphone to replace the one they just bought 4 months ago...

[Larry Edgerton]

The CPI is also adjusted for things like cars getting more and more features. Is it fair to compare a 1980 Honda Civic with no features to a 2014 Honda Civic that has auto transmission, power lock/windows, and other new features when figuring inflation?

This would only be true if you could buy a car/truck without all the junk on it that is actually not necessary to the true role of an automobile, that being point A to point B. As it is junk forced on us it is part of inflation as compared to stagnant wages. We don't have that choice.

If one believes the government inflation index they are a fool.

[David Weaver]

My dad was wealthy when I was born. I am not sure how much money he earned, maybe $10 a day, but that $10 would buy a heaping cart full of groceries. He died dirt poor, living on his and mom's SS check which combined totaled $1100 a month. They lacked nothing but still I would like to see our family try to live on that even with no house payment.

I think if you trace it, inflation is tied to the desire to earn more money.

Your dad and my grandfather were a lot alike, though my grandfather wasn't amish. There weren't many days that they would've spent $10 around the house, and they saved what they could and bought more land for a long time, and died property-rich and never did sell any of it and enjoy themselves - well, they must've enjoyed themselves because they could do whatever they wanted - they just didn't want to enjoy themselves by spending a bunch of money.

My grandmother sold one of the houses and buildings on their farm (which was ultimately composed of three different prior farms) and she did whatever she wanted, which amounted pretty much to going to a few social events and leaving the heat up as high as she wanted.

I think your trace is right, and the desire to earn doesn't come from the desire to save, it comes from the desire to spend. We have the desire to spend now before we've figured out how to earn, and since the economy is based mostly on consumer spending, the gov. tells us that's what we should do.

I like listening to the videos on wessel's living history farm. It was in nebraska, but I believe it was in a german area (york, ne) and a lot of the folks remind me an awful lot of my grandfather and grandmother and how they talked about things.

http://www.livinghistoryfarm.org/farminginthe30s/movies/hankel_money_2301.html

This one is a short video about living on a dollar a day (including rent), which was subsidized by trading cream and eggs for food.

I don't sense any animosity in anyone in the videos when they talk about their lives living on a shoestring back then. I wish I had so much discipline.

[Curt Harms]

You have to remember that we didn't need a lot of the things we 'need' until some piece of paper or glowing tube told us we needed it - at least if we 'wanted to be the coolest kid in the nieghborhood'.

[Brian Elfert]

This would only be true if you could buy a car/truck without all the junk on it that is actually not necessary to the true role of an automobile, that being point A to point B. As it is junk forced on us it is part of inflation as compared to stagnant wages. We don't have that choice.


On the other hand is it really fair to say that inflation is high because that new car now has more safety features and more features in general and costs more because of that? One can still buy a brand new pickup for less than $20,000 if you want the basic stripped down version. I bought a new Dodge minivan two years ago. Most minivans today have power lift gates, power sliding doors, power side windows, entertainment systems, and all kinds of other extras. I was able to find one that is fairly basic for just under $20,000 without any of the power extras. I had looked at pricing for the Nissan minivans and about fell over when they start at $35,000, but they have all the extras.

My 2012 Dodge Grand Caravan cost the same or slightly less than the 2000 Grand Caravan I had. The 2012 comes standard with steering wheel audio controls, larger engine with better transmission, more airbags, rear heat and A/C, traction and stability control, and stow and go seats. All things the 2000 did not have. The 2012 also gets significantly higher MPG with the larger engine. The only thing the 2000 has this one doesn't is power side vent windows.

Government inflation numbers leave out certain things that can have a huge impact on the pocketbook. Inflation doesn't hit me so bad as I'm single so I'm not spending $500 to $1000 a month on groceries. The cost of eating out has certainly gone way up, but I don't do much of that either. One of the biggest expenses a lot of us have is a mortgage payment. That never changes for 15 to 30 years so long as you don't refinance. Your mortgage cost goes down over time when inflation is figured in. My pay has gone up quite a bit since I took out my mortgage, but I still pay the same on my mortgage.

[Greg Peterson]

Capitalism and free markets are mutually exclusive. Capitalism is the accrual of capital. Free markets are the means of delivering goods and services for the lowest cost.

Eliminate or diminish the efficiency of the free market and capitalism is able to thrive and grow. It has not vest interest in market place competition.

[Ken Fitzgerald]

Hyper = subjective opinion not necessarily the absolute truth

[Phil Thien]

Hyper = subjective opinion not necessarily the absolute truth

LOL, if it wasn't obvious to everyone reading it, my post was intended to be tongue-in-cheek.

I'm actually a bit more concerned that the M&M's melted in my hands a little bit.

[Randy Rizzo]

Been tracking price increases as they occur at our local store for the stuff we buy regularly. Not all like items have gone up the same amount, but these are the items we like. Or liked! I quit buying bacon!

Cost of a loaf of bread went from $2.99 to $3.49. A 16.7% increase


Cost of a pound of bacon went from $5.49 to $5.99. A 9.1% increase. In 2013 that same 16oz pkg was reduced to 12oz, the price, still $5.99 resulting in another increase of 33%.


In 2012 cost of a 16 ounce container of cottage cheese went from $2.79 to $3.19. A 14.6% increase. And in 2013 it's now $3.49 or up another 9.4%


Cost of a doughnut went from $.69-$.79 a 14.4% increase


1/2 gallon of milk up from $2.79 to $2.99. Up 7%

I will wait for items I like to go on sale, milk for example. Milk Monday is a twofer, 2 half gallons for the price of one. Other items I will buy in bulk if they are on sale cognizant of the expiration date.

[Dick Latshaw]

My wife came home last week with a 4 lb bag of sugar. Same price as the 5 lb bag she used to buy.

[Larry Edgerton]

On the other hand is it really fair to say that inflation is high because that new car now has more safety features and more features in general and costs more because of that? One can still buy a brand new pickup for less than $20,000 if you want the basic stripped down version. I bought a new Dodge minivan two years ago. Most minivans today have power lift gates, power sliding doors, power side windows, entertainment systems, and all kinds of other extras. I was able to find one that is fairly basic for just under $20,000 without any of the power extras. I had looked at pricing for the Nissan minivans and about fell over when they start at $35,000, but they have all the extras.

My 2012 Dodge Grand Caravan cost the same or slightly less than the 2000 Grand Caravan I had. The 2012 comes standard with steering wheel audio controls, larger engine with better transmission, more airbags, rear heat and A/C, traction and stability control, and stow and go seats. All things the 2000 did not have. The 2012 also gets significantly higher MPG with the larger engine. The only thing the 2000 has this one doesn't is power side vent windows.

Government inflation numbers leave out certain things that can have a huge impact on the pocketbook. Inflation doesn't hit me so bad as I'm single so I'm not spending $500 to $1000 a month on groceries. The cost of eating out has certainly gone way up, but I don't do much of that either. One of the biggest expenses a lot of us have is a mortgage payment. That never changes for 15 to 30 years so long as you don't refinance. Your mortgage cost goes down over time when inflation is figured in. My pay has gone up quite a bit since I took out my mortgage, but I still pay the same on my mortgage.

Sure it is fair. The cost of transportation went up for whatever reason. New cars/trucks are out of more and more peoples reach every year. Lots of people are driving around with bigger car payments than they have an economic right to be driving because they have not faced the reality that they can no longer afford X car.

I have kept my vehicle costs in line with my income for the last twenty five years. I went from diesel 4x4's to a 2 wheel drive Ranger. I'm not making that much less, but expenses have increased and what I am able to charge has not. My rates are the same as 1992 and I am getting my throat cut constantly at that rate. Sorry buddy, but I don't care how you want to twist it, transportation costs are way up. The exact truck I bought in 1992 for $11,900 is $27,000 now. Many of the other costs I have to deal with have as much as quadrupled in that time. My rates have not.

Larry