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February 15, 2011

Inflation

The Planter's trail mix in the company vending machine just went from 75 cents to 85 cents. The Payday bars went from $1 to $1.20.

No, I'm not one of those predicting a new Weimar Germany, this column notwithstanding. But wholesale ag-commodity prices are bleeding into retail. The cafeteria just raised coffee prices, too.

Posted by Jay Hancock at 3:39 PM | | Comments (4)
Categories: Inflation/Deflation
        

Comments

This is not necessarily a bad thing. We're a debtor nation now and debtors are generally in favor of some inflation. With all apologies to both William Jennings Bryan and Paul Krugman, I welcome a little inflation and choose not to be crucified on a cross of peanuts.

(For the Krugman reference see here: http://nyti.ms/evqHN1. If you need a reference on the WJB quote, you should go back and take your high school history course over.)

Stuart: I enjoyed the peanuts very much, did not feel crucified and gladly paid the extra dime. Agree that a nice CPI of 3 percent for the next couple years would do us a world of good if it was accompanied by sustained GDP growth. Would bet that high school history is no longer the same as what was consumed by you, me and Krugman, and that WJB is nowhere to be found. JH

Jay: did you check the package weights as well?

I'll bet the higher price is only half the tale.

Inflation: Government policy that favors debtors and producers at the direct expense of savers and consumers.

Based on known quantities, barring a serious course correction, our lowest end inflation rate is going to start running about 3-5% depending mostly on real growth. The highest figure involving a total crisis of confidence is 13-15% sustained after a short, initial price shock of about 100%.

I walked through the math of the worst case back in Nov: http://seekingalpha.com/instablog/490751-josh-dowlut/110483-qe2-inflation-worst-case-scenario

Are you sure this wasn't a 'amendment' to the city bottle tax to also include candy bar wrappers :)

In all honesty, have you seen the fuel prices? how many payday bars does it cost just to cover the price of the delivery fuel.

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About Jay Hancock
Jay Hancock has been a financial columnist for The Baltimore Sun since 2001. He has also been The Baltimore Sun's diplomatic correspondent in Washington and its chief economics writer. Before moving to Baltimore in 1994 he worked for The Virginian-Pilot of Norfolk and The Daily Press of Newport News.

His columns appear Tuesdays and Sundays.
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