gavinfielder
DP Veteran
- Joined
- Sep 24, 2012
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- Sacramento, CA, USA
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If we assume that there are two types of inflation--cost push and demand pull--the situation you describe would obviously have to fall under demand pull, but when I consider that demand-pull inflation would have to be preceded by either increased consumption or decreased production, I can't see any way that that can be the case. There could be a third type of inflation, if you want to consider that food prices could be an asset bubble, but I want to reject this thought with every fiber of my moral being.I agree with you, other than the inflation.
Being that inflation is happening, as evidenced by even just the basic costs of groceries, clothing and fuel. Those that like to grab out the charts and graphs, note, large goods have remained stationary or even dropped in price, because no one's buying them. The cost of basic living has inflated, causing additional ripples across the economy, and as those who live hand-to-mouth well know, the dollar has devalued across the board, causing the effects of the initial inflation to be felt even harder among the lower income groups.
If we assume that there are two types of inflation--cost push and demand pull--the situation you describe would obviously have to fall under demand pull, but when I consider that demand-pull inflation would have to be preceded by either increased consumption or decreased production, I can't see any way that that can be the case. There could be a third type of inflation, if you want to consider that food prices could be an asset bubble, but I want to reject this thought with every fiber of my moral being.
The inflation I generally see in food is that fresh fruits and vegetables are kinda crazy expensive now. Is it really demand pull inflation though? If so, is it that we don't produce enough produce (which seems unlikely to me), or that people are buying more and more (which is even more unlikely)?
Apples are already ridiculously expensive here. I haven't seen apples below $2/lb in a while. You'd think for a common crop they wouldn't be luxury price.I fully expect to see ridiculously expensive apples come fall.....
Apples are already ridiculously expensive here. I haven't seen apples below $2/lb in a while. You'd think for a common crop they wouldn't be luxury price.
to the rest of the post: aha. The weather's effect on agriculture isn't really in any significant news source, mainstream or not, so urbanites like myself tend to forget about it.
Food inflation has not hit the US. For various reasons, there is little correlation between the cost of the raw foodstuffs and the finished product.
And overall inflation has been low. If anything, we're climbing out of a brief recessionary deflation.
According to the USADA, food prices went up a whopping 3.7%. Some prices went up more than others (e.g. beef, eggs, pork). 2012 was estimated for 2.6%. This only barely outpaces the overall inflation rate.Considering the chart is two years out of date, it's a little difficult to claim that 'inflation' hasn't hit to grocery isles...
According to the USADA, food prices went up a whopping 3.7%. Some prices went up more than others (e.g. beef, eggs, pork). 2012 was estimated for 2.6%. This only barely outpaces the overall inflation rate.
The price for fresh vegetables actually fell by 5% in 2012.
And no, you can't look at one and only one vegetable and, on that basis, declare that food has suffered massive inflation. For starters, you aren't thinking about the prices that have stayed the same or dropped slightly. Some prices will increase and others will fall. That's why you have to look at a "basket" of goods.
At least once a month on NPR you'll hear about such things, it's really nuts how some drought will kill of some massive percentage of U.S. crop of a certain kind, and months later they inform we'll be seeing higher XYZ prices. Some times they get import more and it doesn't get too expense, etc., but yeah, always surprises me too how massive the impact of yearly weather on food crops.Apples are already ridiculously expensive here. I haven't seen apples below $2/lb in a while. You'd think for a common crop they wouldn't be luxury price.
to the rest of the post: aha. The weather's effect on agriculture isn't really in any significant news source, mainstream or not, so urbanites like myself tend to forget about it.
Oh yeah, NPR did cover agriculture. I should listen to the radio more.At least once a month on NPR you'll hear about such things, it's really nuts how some drought will kill of some massive percentage of U.S. crop of a certain kind, and months later they inform we'll be seeing higher XYZ prices. Some times they get import more and it doesn't get too expense, etc., but yeah, always surprises me too how massive the impact of yearly weather on food crops.
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