Dear Friends,

Further proof that the rising CCI (Continuous Commodity Index) is not without its effect on the pocketbook of the everyday citizen.

You still have to laugh at the writer’s conclusions. If A=B and B=C, then A=macaroni:

"Still, there was little sign of budding inflation… excluding food and energy…”

Yep, that’s the stuff that no one needs or no one buys and therefore has no effect on the real world.

Rising lumber prices at the home improvement stores, rising hardware costs, rising PVC costs, rising sheetrock costs, rising gasoline prices, rising meat prices, rising sugar prices, rising baby food prices, rising fruit prices, rising diaper prices, rising fees on local services,… Nope – this has zero effect on the average consumer.

Are you not relieved after learning that what your eyes tell you when you watch the cash register at the local grocery store and you hands tell you after carrying fewer bags out to the car for a larger amount spent is all just a function of an overactive imagination, a bit of indigestion resulting from the previous evening’s dinner?

Wholesale prices rise in March as food costs jump
Wholesale prices rise in March as food costs jump, but core inflation remains all but flat

Christopher S. Rugaber, AP Economics Writer, On Thursday April 22, 2010, 12:16 pm

WASHINGTON (AP) — Wholesale prices rose more than expected last month as food prices surged by the most in 26 years. But excluding food and energy, prices were nearly flat.

The Labor Department said the Producer Price Index rose by 0.7 percent in March, compared to analysts’ forecasts of a 0.4 percent rise. A rise in gas prices also helped push up the index.

Still, there was little sign of budding inflation in the report. Excluding volatile food and energy costs, wholesale prices rose by 0.1 percent, matching analysts’ expectations.

Food prices jumped by 2.4 percent in March, the most since January 1984. Vegetable prices soared by more than 49 percent, the most in 15 years. A cold snap wiped out much of Florida’s tomato and other vegetable crops at the beginning of this year.

Gasoline prices rose 2.1 percent, the department said, the fifth rise in six months.

In the past year, wholesale prices are up 6 percent, with much of that increase driven by higher oil and other commodity prices. But the core index, which excludes food and energy, rose only 0.9 percent.

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