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| Home Front Economy |
| The Impending Food Fight |
| 2007-06-28 |
| By Victor Davis Hanson |
| Posted by:ryuge |
| #12 #10 BP - I've never been able to figure out why anyone would have variable interest rate anything. Can you enlighten me? |
| Posted by: Barbara Skolaut 2007-06-28 23:58 |
| #11 We don't have any of that, Bright Pebbles dear. Mr. Wife only lets me do such things when the rates are falling. ;-) |
| Posted by: trailing wife 2007-06-28 22:51 |
| #10 trailing wife hint: pay of any debt with a variable rate of interest. |
| Posted by: Bright Pebbles 2007-06-28 22:14 |
| #9 So I should stock up on toilet paper and toothpaste now, and BMWs later? |
| Posted by: trailing wife 2007-06-28 20:38 |
| #8 I have been wondering when the economic phenomenon of excess inflation was going to move from the financial press to the political press. Perhaps this is the first step of this issue getting onto the radar screen. Ed, you are correct that all goods are not experiencing inflation, but the goods that are NOT are limited to those in which there is massive overcapacity (e.g. housing) or in which the main input to which is labor or manufacturing (e.g. any manufactured goods imported to the U.S.). Up until recently, Greenspan was successful in containing inflation to financial-backed assets like stocks, bonds and homes (since a majority of the housing market is financed by debt). He left (IMO) when he saw that inflation was seeping into primary goods like food, fuel and basic materials. The CPI is a very unreliable indicator of the general level of inflation for several reasons. The most obvious of which is that the widely advertised measure excludes food and fuel. One of the lesser reasons is due to the changes in calculation enacted by the Boskin commission, in which hedonic pricing was adopted in calculating the major cost indices. Essentially, hedonic pricing deflates the prices that we actually pay for a good by the perceived higher quality of the good compared to the past, thus understating the rate of change in prices. Couple the above with the fact that the Fed stopped publishing M3 last year, and the stage is set for massive hyperinflation the likes of which we have never seen in our lifetime. My motto in preparing for the impending recession is deflation in things we want/inflation in things we need. |
| Posted by: mjh 2007-06-28 18:12 |
| #7 I buy it. Though a combination of letting too many people in the country coupled w/our insane calorie consumption also doesn't help. |
| Posted by: Broadhead6 2007-06-28 13:27 |
| #6 report earnings = export earnings |
| Posted by: ed 2007-06-28 12:34 |
| #5 Hanson is right. It's not dollar inflation. Otherwise all goods would be experiencing inflation and they are not. Since Sept 11, 2001 oil prices have tripled (with corresponding increases in nat gas used to make fertilizer). A factory I have in interest in used to use nat gas for process heat because it was so much cheaper. But a few years ago we switched because coal generated electricity is cheaper than burning nat gas (a completely screwy idea if you think about the capital required to generate electricity). In addition, as Hanson wrote, there have been huge increases in corn acreage to meet demand for ethanol. That mean less acreage for other crops. In the final analysis, this production increase is good for the US and other agricultural economies. It increases report earnings and marginally reduces money sent to those who would destroy us. Now if our leadership only had the sense to crank up nuclear and coal-liquids production until we are self sufficient. |
| Posted by: ed 2007-06-28 12:33 |
| #4 I didn't buy this piece. Rising energy costs are a factor, but Bright pebbles has it right. Too much liquidity, particularly in the american dollar is causing inflation. The immigration argument - I didn't buy it. We have what, 12 million illegals? If they closed the border today it wouldn't have an impact. I think we are in for an inflation *SLAM* coming up in the next 12-18 months. |
| Posted by: flash91 2007-06-28 11:36 |
| #3 Defacto American diet????? |
| Posted by: anonymous2u 2007-06-28 11:18 |
| #2 No food price inflation is linked to one thing. The US Dollar printing machine is running WAY too fast. |
| Posted by: Bright Pebbles 2007-06-28 09:19 |
| #1 Wish I could write like this man. |
| Posted by: gromgoru 2007-06-28 08:34 |