Of course. The rising price of food is due to “the weather.” Not the fact that the Fed has created more new dollars in the last five years than in the last 100 years of its history. Keep telling yourself it’s the snow.
The CPI doesn’t capture the true extent of inflation as Peter Schiff wonderfully illustrated in this video. The Fed routinely states that it’s “target inflation rate” is 2%, meaning that over the course of an average human life the American dollar will lose 75% of its value. The powers that be have succeeded in convincing the world that inflation is good and that -gasp- deflation is the bane of our existence as if nothing could be worse than falling prices.
And it seems you can’t turn on the news today without reading some sort of hand-wringing about income inequality with no mention of the Fed’s policies whatsoever. The Fed is handing over ~$70 billion dollars a month to Wall Street banks in order to “stimulate the economy” and is clueless when asset bubbles in stocks and bonds and real estate grow to obscene levels. Who benefits when the stock market breaks records daily? Is it the average family living paycheck to paycheck or the Donald Trumps and Warren Buffets? The Fed is the primary driving force behind the strains on the poorer Americans. When the price of groceries or fuel or other consumer goods grow it doesn’t impact the wealthier demographics to the extent that it strains the lower income earners (especially those on fixed incomes).
And this article mentions the Fed a grand total of 0 times.
Every single time I read an article like this they mention inflation or the “rising cost of living” in passing without ever asking why, and what that really means.
"But the true culprit in devaluing the purchasing power of the dollar is the Federal Reserve. This is why comparisons of prices and wages must always be “inflation-adjusted." The minimum wage today ($7.25) is over three times what it was in 1977 ($2.30). Adjusted for inflation, however, it is actually 18% less. In other words, it is inflation that is makes the income less valuable. But most people don’t understand what inflation is, and they just take it as a given.” (x)
"When Martin Luther King, Jr., led the March to Washington for Jobs and Justice, fifty years ago this week, one of the objectives of that March was to raise the minimum wage to $2 an hour. $2 an hour in 1963, adjusted for inflation, comes to over $15 an hour in today’s dollars." (x)
Here’s a visual representation of the decline of the US dollar’s worth (buying power) since the Federal Reserve was created in 1913.
Do you think any of the people reposting this read the article? Apparently not. It attributes the rise in food prices to droughts and bad weather, ie a negative supply shock. That has nothing to do with the Fed. Up until this supply shock, food price indices have kept up with general CPI measures, which yes are true. The article looks at inflation over a three year period so as to present shockingly large numbers. In their annualized forms, food price growth is actually low relative to goods in general. If you don’t believe the government statistics use Billion Prices Index at MIT. You’ll find the same thing.
This article presents precisely no evidence that food prices are rising faster than normal besides the claim of one Jen Singer, who has noticed that the prices of bacon, chicken, and beef have gone up in one grocery store in a country of 300,000,000 people. Economists are “painting a benign picture,” as the article puts it, because the picture is, in fact, benign. This is why we have data and computers and spreadsheets. So we can actually measure things instead of using heuristics like “one parent who shops in the most expensive city in the world thinks things are too expensive.”
On to Peter Schiff: yes you can print money without inflation because velocity isn’t fixed. This is something that econ undergrads can prove using a koyk lag structure and some money supply data from FRED. I’ve done this before as a simple classroom demonstration of koyk lags and will post later as well.
Really this is just lazy thinking. Inflation is too much money chasing too few goods- consumer demand is greater than the ability of the real economy to produce. This would require people somehow getting more money. According to the original poster (“Who benefits when the stock market breaks records daily?”) none of the money from QE is reaching consumers. So it is not to blame for the price of anything.