A recent e-mail blared, "The National Inflation Association says there is
reason for grave concern", to which I thought to myself, "Well, welcome to my
world, chumps, because all I do is bewail the horrors of the coming inflation
in prices that will follow such huge inflations in the money supply!"
With such a dismissive attitude, you can tell that I was going to trash the
e-mail without reading it when, suddenly, I noticed that they used the word
"grave", as in a hole in the ground where cemetery workers dump what is left of
dead, emaciated bodies after the terrifying rise in prices, caused by massive
creation of money by the Federal Reserve and jammed into the economy by the
massive deficit-spending of the deplorable Barack Obama administration, forcing
people to live in abandoned buildings and
eat various rodents and local flora, perhaps snacking on the occasional corpse,
whereupon these people turn into raging zombies who hide by day and come out at
night to kill people, splitting open the heads of their victims and eating
their brains, walking mechanically and stiffly down the street, arms held
akimbo, hollowly intoning, "Brains! Must have brains to eat!" and it's a real
scary mess until somebody, at the last minute, gets the good idea to get some
flame throwers, a successful tactic that seems to elude the typical zombie
mind, even as they are being incinerated.
Well, as bad as this doomsday scenario is, it could get scarier, like if the
zombies started using flame throwers, too, or even scarier, like the actual
news, which is that "US food prices jumped by 2.4% in March 2010 in the largest
monthly leap in more than 26 years, and the sixth consecutive monthly
increase." Yikes!
A 2.4% monthly leap! That's a 28% annualized increase in the price of food! In
One Freaking Year (OFY)! Yikes!
By this time, alarms are going off in my head, and, like the terrific husband
and father that I am, I shout protectively to the family, "This is it! The
inflationary collapse that comes from the Federal Reserve creating too much
money and the idiotic congress deficit spending too much money has started,
just like I said! To the bunkers, morons! Hup! Hup! Let's go!" expecting, you
know, that they would immediately jump up, their eyes shining with pride as
they obediently follow me into the Mogambo Bunker Of Paranoid Seclusion (MBOPS)
where they could make themselves useful by, perhaps, zapping up some microwave
pizza, or at least just shut up and stand attentively by to help with reloading
something, just in case.
Alas, it was not to be, and among the hooting and jeering from my family, my
wife even insulted me by asking, "Will you be back in time for dinner?" like
this economic calamity is just a stroll down to the beach and back!
So I say to her, as I am sweeping by her on my way to the MBOPS and trying to
keep a tone of incredulousness out of my voice, "Do you realize that the
National Inflation Association says that fresh and dry vegetables are up 56.1%
in price in the last year? How about that fresh fruits and melons are up 28.8%
in price in that selfsame last year? How about eggs 'for fresh use' being up
33.6%, or beef and veal up 10.7%, or dairy products being up 9.7%? Does any of
this inflationary horror mean anything to you?"
As I did not stop to listen, I missed most of her reply, and I was soon out the
door and out of earshot, but I remember that it started out with the usual
muttering under her breath, which means I assume she went on to wail about how
she has wasted her life marrying me and blah, blah, blah.
And so I missed whatever it was she had to say, although I am sure I have heard
it before.
And speaking of missing something, I missed it myself, but Dan Amoss here at
The Daily Reckoning reported, "Already we're seeing very high producer prices.
The Wall Street Journal described this phenomenon in a recent article entitled
'The High Cost of Raw Materials.'"
The Journal reported that "Data on producer prices released by the Bureau of
Labor Statistics on Thursday shows how rapidly the pressure on corporate
America is mounting. The producer-price index showed that crude goods such as
iron ore, construction sand and pulp shot up 44.5% year-over-year, the fastest
rate since 1974. Including energy and food costs, crude goods prices rose
33.4%."
He goes on to report that "The ISM's Prices Paid Index is telling a similar
story", which is that "the ISM announced that its Prices Paid Index registered
the largest year-over-year increase since the 1970s."
And what does this mean to the average guy, like you and me, who is just
looking for a way to make a lot of money without working? It's easy: buy gold,
silver and oil! It's so easy that I sometimes say, "Whee! This investing stuff
is easy!"
Richard Daughty is general partner and COO for Smith Consultant Group,
serving the financial and medical communities, and the editor of The Mogambo
Guru economic newsletter - an avocational exercise to heap disrespect on those
who desperately deserve it.
(Republished with permission from
The Daily Reckoning. Copyright 2010, The Daily Reckoning.)
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