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DR. SHAWN RITENOUR: PLAYING THE OSTRICH ON PRICE INFLATION |
By the time you read this, there’s a good chance that Federal Reserve Chairman Ben Bernanke will have held the Fed’s first press conference ... Leading up to this historic moment, the popular press has repeated a well-rehearsed rhetorical dance as it reports on the monthly release of the Consumer Price Index. Those who should know better repeat the mantra that, while food and energy prices may have increased, so-called core inflation … remain[s] flat as a pancake…. Unfortunately, things are not as rosy as we are being told. Food and beverage prices increased at an annual rate of 8.4 percent. Prices of household fuel and utilities, the housing expenses that everyone does have, rose at an annual rate of 7.2 percent. Transportation prices, which include prices of automobiles, gasoline, and public transportation, rose at an annual rate of 26.4 percent. Normal people who live their lives outside the Beltway know that the prices of the goods they buy are generally rising. They do not have to wait to be told by the experts.
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