In spite of what the CPI would indicate, I am convinced that inflation is back, and back with a vengence. Here are a few examples.

The most obvious is at the gas pump. Even though we had a temporary decline in price, prices are once again inching their way up. We may very well settle on $3.00 a gallon gas before the winter is over.

This afternoon I took my bar-be-que tank to have it filled. I usually pay $14 to $15 for a refill. This afternoon I paid $18.

Yesterday we went out to eat. Nothing fancy, just hamburgers and such for the three of us. We recently paid $20.00 for this meal at this same restaurant, last night we paid $27.00.

This afternoon we went to the supermarket to pick up some salad stuff and some bread. 1 and 1/2 small plastic bags filled with merchandise, and we left $23.00 in the supermarket.

This afternoon we received our electric bill. For almost the same kilowatt hour usage as last year we were billed $145.00 as opposed to $113.00 for last year.

I could go on and on, but I think that you probably get the picture. It seems to me that inflation has reared up it ugly head and is on the rise again. It seems that everything costs significantly more.

How about you? Are you seeing the same things? Do you think inflation is back?

 

It's back with a vengeance! (I'm not sure it ever actually left).

We've seen the same things. Food, gas, electricity, and especially natural gas (for cooking and hot water) and oil (for heat).

We've had increases in weekly health insurance premiums, and co-pays. Car insurance is actually supposed to go down a bit, but I'll believe it when I get my actual bill.

The increases of the past year have been particularly noticeable. It's everywhere.

 

IMO, it is all driven by fuel cost. No one has still come up with a good explanation of why Diesel fuel which requires less refining than gasoline and historically has been the least cost fuel has been more expensive then 93 Octane all of a sudden for the last year or so. I have to believe that the oil company (which have all had record profits for the past year) executives figured out that in our global economy that vitually everything ships in vehicles that use diesel fuel. Freighters, trains, and trucks.

In Rob's examples, everything that he mentioned is impacted by the rising prices of petroleum products, including jet fuel for air frieight of veggies. Most freight companies and delivery services are adding fuel surcharges to the cost of delivering goods.

The nine percent annual growth rate of the Chinese economy also factors in heavily. There rising demands for fuel has had a impact, both with their growing middle class and with their construction boom. In 2005 China consumed 50% of the worlds cement to support their construction boom! Just think about the fuel demand required to support that type of growth? Not to overlook the fact that Lamborghini opened a show room in Bejing. They are not exactly economy cars.

Here at home, I am still amazed by the numbers of Giant Sized SUV's that I see. Expeditions, Excursions, Yukons, Hummers etc. All adding to the supply and demand for fuel.

That is my .02

 

Lainey,

I agree with you, I'm not sure it ever really left either. I just don't think it was as bad as it is now.

Matt,

I agree that much of the increase is due to the increase in fuel price. Like you I have no clue as to how diesel fuel is priced except to suggest that cost has very little to do with it. I've long felt that the price of fuel was a function of what the market would bring. If they can get a premium for diesel, they will.

 

All I have to do is look at my land and school tax increases, both up over 20% from last year.

 

As a matter of fact, a lot of the federal tax breaks (not all, but a good portion) that the middle class is getting are being negated by the increases in state and local taxes.

As the federal government gives less to the states, the states and localities have to raise the funds on their own.

 

I have noticed fuel prices creeping up and also the price of produce and like it has already been stated in this thread I too agree they are interrelated. I buy a head of lettuce every week and the price has increased 60% over the last month or so as has the price of tomato's and cucumbers.

 

Guys it's a shortage factor both in fuel and in veggies. Remember Wilma? She wiped out all the winter veggie and fruit crop down here. That drove up the prices of veggies as they have to be freighted in from other countries.


I think what you're seeing is more hurricane effect and fear of oil prices.

The veggie factor is a lot bigger than you think.


fltsfshr

 

Supposedly the inflation rate in 2005 - not including energy - was 2.2%, but that certainly doesn't seem to reflect prices on the street. Interestingly, OH rolled its sales tax rate back 1% about 6 months ago and my property taxes were reduced about 12% based on rollback, rather than appraised value????
My natural gas contract is up 65% and electricity was doubled per unit last month.
The CPI minus one, which is used for government pension, federal employee pay, and SS pay raises, was 4.1%.
The CPI better reflects reality than the so-called core inflation rate, in general.
All in all, pretty scary!

 

Levi, you and Rob have to expect these tax increases....when you live in the hyper-real estate market of Metro New York.

Just think how much your property value has increased in the last year