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Food Prices Are Soaring Faster Than Inflation and Incomes

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Re: Food Prices Are Soaring Faster Than Inflation and Incomes

#461

Post by pottertheotter »

H8crilA wrote: post #121
xbmcuser wrote: post #33

As someone that is the food mostly spice trade prices have started going up in the last 2-3 weeks though prices have not even reached pre pandemic levels. Black Pepper prices have jumped 20+% in the last 20day that price is still 50% cheaper than what it was 4-5 years ago. The largest problem is not availablity of goods rather shipping. I would advise investing in shipping companies if you are active in the stock mar…

Surely you're familiar with the Baltic Dry Index, an index of shipping costs: https://tradingeconomics.com/commodity/baltic Also, in case anyone thinks the current environment is crazy then check out the commodities bubble period of 2008 for that index.

Be careful with your reliance on BDI. As the name implies, it does not reflect prices for the entire shipping industry (e.g. container ships). I used to have investments in the area as an institutional investor, and it was common to see people not understand this.

Re: Food Prices Are Soaring Faster Than Inflation and Incomes

#462

Post by hinkley »

fennecfoxen wrote: post #291
whoisninja wrote: post #237

CPI is a joke, they do something called hedonic adjustments to things like tech products etc. It's completely subjective and BS. Technology is deflationary, things should get cheaper because we go after producing them in creative ways one demand is high. CPI is absurd, it only perpetuates consumerism and punishes savers. We product 2x the food society consumes - mostly wasted away, just with some supply chain efficie…

> CPI is absurd, it only perpetuates consumerism and punishes savers. Okay okay back up. The consumer price index is a series of numbers designed to help people understand what dollar-denominated figures mean to ordinary people going about their lives, spending those dollars. If that's "consumerism," well yes, it's a portrait of consumerism. Many economists, mind you, believe CPI doesn't correct quite enough, and sus…

There have been several eras in computing where a peripheral had a surplus of capability that applications were not making compelling use of. Most especially video cards.

Then one day cards are 'good enough' that someone builds an application that leverages this power, and all of a sudden that becomes the new baseline. Over night you went from having a video card that is three times what you need to a third of what you need.

We might consider availability of seafood to be a given now, due to improvements in food logistics. But it wasn't always the case. For sure strawberries in winter were just not a thing one would buy until relatively recently.

If I wanted vitamin C in February before it would probably be in the form of jam or tomato sauce.

Re: Food Prices Are Soaring Faster Than Inflation and Incomes

#463

Post by gruez »

plank_time wrote: post #449
gruez wrote: post #401

Earlier quoted context omitted.

>Its probably being cancelled out in the basket by healthcare and education prices skyrocketing. Oh wait. If you go to bls's site, you can easily tell what it's being canceled out by. From the looks of it, it's mostly being canceled out by low energy prices. https://www.bls.gov/cpi/tables/supplemental-files/home.htm

I live near San Fran and I paid over $4/gallon for regular gas. That’s the same price I paid when gas was at all time highs. I know that a lot of it is taxes but the BLS must be taking that into consideration, no? Also electricity is at all time highs, depending on the tier and time of day I’m paying 0.50/kWh. During the pandemic this has been killing me. I can’t believe that energy prices are low at least around her…

Here's the data for the san francisco area: https://www.bls.gov/regions/west/news-release/2021/pdf/consu..., dated december 2020.

on page 5 it says gasoline prices are down 9.2% YOY, but electricity is up 5.9% YOY.

Re: Food Prices Are Soaring Faster Than Inflation and Incomes

#464

Post by mdorazio »

plank_time wrote: post #449
gruez wrote: post #401

Earlier quoted context omitted.

>Its probably being cancelled out in the basket by healthcare and education prices skyrocketing. Oh wait. If you go to bls's site, you can easily tell what it's being canceled out by. From the looks of it, it's mostly being canceled out by low energy prices. https://www.bls.gov/cpi/tables/supplemental-files/home.htm

I live near San Fran and I paid over $4/gallon for regular gas. That’s the same price I paid when gas was at all time highs. I know that a lot of it is taxes but the BLS must be taking that into consideration, no? Also electricity is at all time highs, depending on the tier and time of day I’m paying 0.50/kWh. During the pandemic this has been killing me. I can’t believe that energy prices are low at least around her…

You’re using local price factors when BLS is looking at National ones. Outside California, things are quite different. For example, see [1]. In general, just assume that California doesn’t reflect the broader US on basically any measure.

[1] https://www.eia.gov/dnav/pet/pet_pri_gnd_dcus_nus_a.htm

Re: Food Prices Are Soaring Faster Than Inflation and Incomes

#465

Post by [deleted] »

vkou wrote: post #437
whoisninja wrote: post #435

Earlier quoted context omitted.

if i want to save, don't hold cash? hold what then? become investment manager in free time instead of my day job as software developer?

If you want to be prudent, hold land, stocks, or bonds. Buy-and-forget with stocks, on average, outperforms both inflation, and actively managed portfolios.

[deleted]

Re: Food Prices Are Soaring Faster Than Inflation and Incomes

#466

Post by whoisninja »

vkou wrote: post #437
whoisninja wrote: post #435

Earlier quoted context omitted.

if i want to save, don't hold cash? hold what then? become investment manager in free time instead of my day job as software developer?

If you want to be prudent, hold land, stocks, or bonds. Buy-and-forget with stocks, on average, outperforms both inflation, and actively managed portfolios.

until you need the money to pay big emergency bills, which at he wrong time can wipe you out no wonder there are half a million bankruptcies per year because of medical bills in the US and 40% of people have no savin and another significant portion doesn't have enough saving to spend time to invest in stocks, bonds and land(land also comes with perpetual high property taxes in most places in the US)

Re: Food Prices Are Soaring Faster Than Inflation and Incomes

#467

Post by PEJOE »

gruez wrote: post #421
PEJOE wrote: post #407

Earlier quoted context omitted.

> From a finance perspective there's no difference between a house and a share in a corporation. They're both productive assets that provide returns. In the case of a house, it provides shelter as a service, which can either be consumed by the owner (by living it it), or by selling it (renting it out). The only difference is that with a house, the relation to you is more direct, as opposed to a tiny fraction of a mul…

>From a finance perspective, theres no difference between food and a share in a corporation Clearly not. After you eat a bread, it's gone. After you live in a house it's still there. A better analogy would be something like a farm, which continuously provides sustenance as a service. >The primary purpose of a house is to, well, house people. Shelter is a necessity. People who are most vulnerable to inflation are the…

> Clearly not. After you eat a bread, it's gone. After you live in a house it's still there.

After you live in a house a long time it falls apart. Capital Expenditure restores the asset to its previous value. Bread just depreciates faster. but can still be traded, bought and sold. In Japan houses are often only ever used by one family, and the house is destroyed when the land is sold. I am taking your insistence on a cash flow perspective to its logical extreme to show that it is not always applicable.

Corn is an asset when it is bought and sold. It is food when it is consumed.

> Should farm (or food producing corporation shares) prices be factored into the CPI as well?

I clearly say at the end that if CPI is not measuring these price increases we should use a different measure. I'm not sure you understand what's going on in this conversation, but food is in the CPI.

> Also, your point about buying housing as some sort of protection against inflation doesn't tell the whole story.

Where on earth do I say this? I say that poor people are exposed to inflation the most, especially increases in housing prices. We should have measure for what working Americans are exposed to, and do not.

Re: Food Prices Are Soaring Faster Than Inflation and Incomes

#468

Post by CodeMage »

pnutjam wrote: post #447
CodeMage wrote: post #441

Earlier quoted context omitted.

You know you can be a "professional X" without X being a science, right? It simply means that X is your profession. Some examples of professions that are not sciences: racer, chef, journalist, writer, singer.

Yes, but those professions have agreed upon norms and standards that can be measured. Did you win, Does it taste good, is it accurate and easy to follow, etc... Economists are all over the place you an pick and choose different theories to support any Point of view.

I'm sorry, but no, they don't. Out of all of the examples I used, only one has agreed-upon norms and standards that can be measured: racing.

All the other examples I used -- chef, journalist, writer, singer -- can win awards and recognition: Michelin stars, Pulitzer, Hugo, Nebula, Grammy, and such. Those are good indicators of their accomplishments, but that's not the same as having a set of "agreed-upon norms and standards that can be measured".

And if you decide to relax your criteria and say that having those is acceptable, then guess what? There's a Nobel Memorial Prize in Economic Sciences, and a slew of other awards for economists.

Like it or not, studying economics is something that people can and do dedicate their lives to. Would it be better if we had more clarity, transparency, and consensus when it comes to what they do? Absolutely. But dismissing the whole profession out of hand is unhelpful.

Re: Food Prices Are Soaring Faster Than Inflation and Incomes

#469

Post by INGELRII »

whoisninja wrote: post #435
INGELRII wrote: post #423

Earlier quoted context omitted.

> Technology is deflationary, things should get cheaper because we go after producing them in creative ways one demand is high. And as a consequence the wages you earned by making tech year ago should have less value than the wage you earned today. You should expect small inflation. If you want deflationary money, wages should decline year by year. If you want to save, don't hold cash.

if i want to save, don't hold cash? hold what then? become investment manager in free time instead of my day job as software developer?

Low cost index funds for over 7 year investment horizon.

If you are in the US and just want to keep the value, Treasury Inflation-Protected Securities (TIPS) directly from the U.S. Treasury. https://www.treasurydirect.gov/indiv/research/indepth/tips/r...

Re: Food Prices Are Soaring Faster Than Inflation and Incomes

#470

Post by asdff »

whoisninja wrote: post #237

CPI is a joke, they do something called hedonic adjustments to things like tech products etc. It's completely subjective and BS. Technology is deflationary, things should get cheaper because we go after producing them in creative ways one demand is high. CPI is absurd, it only perpetuates consumerism and punishes savers. We product 2x the food society consumes - mostly wasted away, just with some supply chain efficie…

How do you quantify waste? If I peel a potato, is the skin factored into the waste? I think there are a lot of foods we waste simply because you can't get all the yield out of the given mass, so on paper maybe you do only use half the pumpkin after you peel it, remove the stem, take out the guts, and turn it into a pie.
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