Presenting The Fed's Slogan: "Making It Harder To Feed Your Family For 98 Years And Counting"

Tyler Durden's picture

One of the side effects of the overarching "price stability" mandate of the Fed, it turns out, is the fact that since its inception, food and pretty much all other commodity prices have, well, gone up non stop.

All of this, of course, is courtesy of the relentless loss of dollar purchasing power, shown below on a log scale. At this rate, the dollar will have negative purchasing power in under 10 years.

And, no, sorry exporting inflation to China (thank you 50 years of globalization and economic hitmen) to keep the price of everything in the core inflation bucket low ain't gonna cut it anymore. Other countries don't need US debt any more - they have enough of their own.

Chart courtesy of John Lohman

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mynhair's picture

No soup for you, bitchez!

Xibalba's picture

Why should they care?

redpill's picture

Exactly, when you drink blood, who cares what the price of bread and milk are?

BlackholeDivestment's picture


...BTFD Cup of Fornication, put on the Bernank Shnikies and wait for the comet to run, muuuh ha  haa haaa.

FEDbuster's picture

"On a long enough timeline the value of the dollar will fall to zero." Ben Bernanke?

Or as Dr. Marc Faber said, "It took the FED almost 100 years to devalue the dollar 97%.  The next 97% devaluation won't take as long."

Hook Line and Sphincter's picture

They drink blood while they make us drink cum. My lips are tearing at the seams, goddam that ceock is big.

akak's picture

My lips are tearing at the seams, goddam that ceock is big.

Clearly, you are not DSK's hotel maid.

bbq on whitehouse lawn's picture

Bread is 3.99 a loaf and milk is 1.09 a quart.

Blood i dont know but then i still produce my own blood. Not so with Bread and milk. 

serotonindumptruck's picture

Blood, milk, and honey. The stuff of life.

BTW, the price of honey is becoming very inflated. $8.99 for 32 oz. of the generic brand.

Of course, something is causing this new phenomena known as Colony Collapse Disorder, with potentially devastating effects on the human food chain, but that's definitely another issue entirely.

Thomas's picture

It's all expectations. If people would only buy core-inflation goods instead of that necessary crap, they wouldn't notice the price rising. Of course, as the Fed says, the masses always get it wrong so, if life looks like it really sucks, it must be peachy.

Manthong's picture

Hmmm.. This guy's got the right idea for beating the Fed, but iPads are higher in fiber and essential minerals.

rocker's picture

Robo says you will eat well if you buy some Polo Ralph Lauren or Abercrombie and Fitch. LOL

NoLongerABagHolder's picture

This data is so skewed with an agenda...... The amount of dollars we get per hour of work has also skyrocketed in that same amount of time.

An author I read said it best:

If I have to work 15 minutes to buy 1 gallon of gas at $4.00 a gallon compared to 10 years from now when the price of gas is $10 a gallon but I only need to work 10 minutes to buy it, did the price rise hurt me?

ZH again leaves out some very basic but important info to keep the bias of the collapse of America.

A little reality check for ZH:

Both charts are from this article:

"The real price of every thing, what every thing really costs to the man who wants to acquire it, is the toil and trouble of acquiring it... But though labour be the real measure of the exchangeable value of all commodities, it is not that by which their value is commonly estimated... Every commodity, besides, is more frequently exchanged for, and thereby compared with, other commodities than with labour." - Adam Smith, The Wealth of Nations, 1776

"What is a cynic? A man who knows the price of everything and the value of nothing." - Oscar Wilde, Lady Windermere's Fan, 1892.



EscapeKey's picture

Well, yes, because of oil and other energy sources, which the Fed has absolutely nothing to do with.

It's ok if I rob you, because your boss will pay you next Friday anyway.

macholatte's picture


The statistics are from a bygone era. The world is a different place since 2008 and we are traveling uncharted waters. The fundamentals are shifting. Here are some real, hard facts that trump all the numbers:

* There’s a Communist-Muslim in the White House.

* His puppet master is a Nazi.

* The Progressive Party controls the USA political parties.

* The Fed is engaging in behavior that has never been done before.

* 47 Million USA people on food stamps.

* $15T USA debt load @ 90% GDP.

* MSM has become a propaganda machine for the Progressives.

* PIIGS threaten the EU.

* Government Sachs runs the USA Treasury

* China & Russia have a non-aggression pact.

* USA police state growing

* Global agreements to control the internet and flow of information

* Middle East oil financing growing Islamic threat to the west

* War, War and more War


With luck, in 20 years we'll look back at the charts showing nothing more than a pimple for 2008-2015. With a lot of luck.

All men can see these tactics whereby I conquer, but what none can see is the strategy out of which victory is evolved.
Sun Tzu

Vuvuzela's picture

he is not muslim thats the hoax

he is of a ceratin race and culture, dig that you will be amased what you will find

morkov's picture

what about the value of a human that needs to spend time (life) on a necessary task? should it be priced in? governing included? or are we starting from scratch again? LOL

Thomas's picture

Oil is up tenfold in a dozen years; how's your salary over this period?

NoLongerABagHolder's picture

Sure if you want to data mine. ZH posted from 1929. Look at the % of disposable income from there. Shoudl I pull out the oil price drop from the 1970's high and determine the same thing in the opposite direction? Of course not.

Over time, salaries have more than compensated for the rise in prices or the loss of purchasing power. Commodities are more violent in price than wages. It will not be differnet this time. They will stay high for awhile as a % of income, and then we will have a cycle in which we will see them low from a historical basis as a % of income. If you are planning on forever high prices as a % of income and loading up on gold and commodites for life, you are a fool.


NoLongerABagHolder's picture

Real numbers have already been given fool......

or should I say cynic?

LawsofPhysics's picture

No, you have not fucknut.  Yeah, we are all going to be billionaires someday!  Silver and gold have the same buying power, but not paper.  You could be making 50K per year today and if you had a wife and one kid you would NOT be able to survive in any major city.  You would also be eligible for food stamps (and would need them).  Thank the fed for this "wealth effect" and keep drinking the kool-aid idiot.

FOC 1183's picture

"fucknut" is a keeper.  And the guy should pick a better example than gas:

Dental Floss Tycoon's picture

Real numbers.  In the late 40s I could buy two hotdogs and a 12 oz Pepsi for a quarter.  That same quarter with a melt value of $6.84 will still buy me the same.  I might even get a little change.

A quarter in 1964 would buy me about 0.83 gallons of gas.  The same silver quarter now would buy me twice as much.

Silver bitches.  No inflation.

scratch_and_sniff's picture

The relative share of GDP(what something was worth then compared to the economy now) for a quarter in 1964 is $5.52 in 2011, and $5.52 would buy you more gas today. If you had of held that quarter in your pocket for 47 years then yes you would have lost. If you had of held ANY currency in your pocket for that long it would have lost. That’s down to increasing money supply for a growing economy, wage increases and increasing and changing trade. But it does NOT mean you were wealthier then. You are much wealthier now through higher standards of life, working conditions, health care, housing, food... Moreover, if you had of held that quarter until 1957 and then invested it in the S&P with the compounded annualized growth rate of ~6.69% you would be worth $9.02.

The guy posting above is right, these charts are posted to generate clicks, ZH knows that the ignorance on this site is rife and the feeling towards the fed and government is bleak, so they are put there just to excite because they paint a certain picture. You're time spent here is a commodity to ZH, you're posts have a nominal value to them gained through advertising and donations. Its a business model.

FOC 1183's picture

Do you really believe the bullshit that is hedonics?

scratch_and_sniff's picture

It's nothing to do with happiness, or trying to gauge it. Its about tracking relative values over time - if you attach happiness to worth or want to believe there is some pseudoscience that can pinpoint it, then whatever floats your boat, but no, that’s not what im talking about, sorry.

FOC 1183's picture

then I apologize for misunderstanding.  but it sure sounds like you're trying to justify 'quality' improvements to inflation measurement (ie, hedonic adjustments).

My only point (and, though I disagree, very much enjoy open debate), is that, as pointed out below, much of what you refer to is the result of productivity enhancements.  The hedonic adjustments to the CPI are, although I don't disagree with them in 'theory', totally subjective.  As such, they, in the end, only distort the accurate measurement of price changes (and resulting loss of purchasing power).

scratch_and_sniff's picture

Ok man, it may be theory(if you can better it, a Nobel prize awaits), but in my book, theory comes before suspicion and wild assumption, and i would gladly use the tools in hand derived from the cumulative body of theory to deal with complex systems, than to blame someone for something that i myself cant ever hope to have pinpoint accuracy about(its like a guy running a shop for 50 years, never doing any stock taking then blaming his staff for steeling cause he feels he should be richer, somehow). Hence, if it is all totally subjective then that argument works two ways, you cant just turn around and say "i feel we should be richer today, I feel we should be getting more for less, someone must be stealing". etc etc Good guys vs bad guys is not economics, and they dont mix.

Calculated_Risk's picture

You are much wealthier now through higher standards of life, working conditions, health care, housing, food...



This is due to increased productivity. Not printing money.

scratch_and_sniff's picture

Oh right increased productivity, I see now. You know I forgot all about how much American goods should really be worth on the global market. Because if the fed had never tried to manage the American economy this last century you would be getting much more for you’re goods. And the rest of the world would gladly pay for your precious  labour and productivity. Get real. Any increased productivity was to supply increased demand, you benefited accordingly relative to what the market, in whatever era would pay. Your problem is that you want to brush with broad strokes with out learning how to hold a pencil.

FOC 1183's picture

What he is saying is econometrically correct.  This is how the Fed, Citi, Goldman, etc. all account for this change.  It's not random fluff.  It's quantified economics.

Again, not trying to be an ass - just debating.  This IS the way they model it.

scratch_and_sniff's picture

When you have just agreed in principal and in spirit with what i said, its a funny kind of debate. I am aware of the product of labour as a wealth creator, what is ignored in favour of the knee-jerk broad strokes however is how that labour finds its way on to the global market, and how its real value is arbitrated and managed throughout the decades(you know, with the "quantified economics"). Where are these qualified economics, i want to hear them? Lets go? It seems they are the only things that will free you, but 99% of people here dont have a fucking clue about them! Im confused.

As Americans, you work no longer, no harder, get better holidays and working conditions, health care, rights(man im not going into a spiel, but you know the rest), along with all the other benefits of living in an advanced society, i just don’t see how else you can measure the outcome of your wealth, or measure what you think you deserve for your labour on the global market(tell me?) when there are children working 80hr wks for rice...maybe you just want to moan, maybe this site is just somewhere to go for people who think its just not fair. Maybe its not, but atleast know what you are really moaning aobut.

NoLongerABagHolder's picture

Here is a little data mining reality for you:

n 1980, gold hit a peak of $850. In 1980, the minimum wage was $3.10 per hour. In order to afford one ounce of gold, a minimum wage worker would have to put in 274 hours of work ... just under seven weeks of labor to afford a shiny new coin.

How does that compare today with gold at $1510 per ounce? Well, with the minimum wage set at $7.25 per hour, the lowest paid worker would need to work only 209 hours.

24% less work for the minimum wage earner to buy an ounce of gold.

Back in 1980, a gallon of gas cost $1.40 at the peak. It would have taken the minimum wage worker 0.45 hours of labor to buy a gallon of gas so he could get to work. Today, at $3.50 per gallon, the minimum wage worker only needs to work 0.48 hours to get himself to the job. Bout the same even though gas prices are up more than 100%

akak's picture

Fuck you.

You have just destroyed whatever trace of credibility you had left here, by taking gold at its short-term price peak in 1980 and trying to use that spike price as indicative of its general price thirty-odd years ago. Utter disingenuous crap.

Go back to troll school --- you have a LOT to learn about intelligent and honest argument.

NoLongerABagHolder's picture

How you doin a cock?

I said it was data mining - but proves the point you can't just look at one small time and come to conclusions like you want to.

Get back to suckin that schlong you like to eat.

akak's picture

Uh oh, puerile personal attacks!

Didn't they tell you in troll school that you are supposed to avoid doing that?

Cass is going to have some sharp words with you about this.

tarsubil's picture

I'll have to start referring to you as Tim "CF" Ayles. Wow, say hi to tom cruise and john travolta for us.

LawsofPhysics's picture

You got to love it when a troll reveals himself.   

knowless's picture

yo, so just real quick

rent for a month 600, taxes 1/5th or more,

40h x 7.25 = 290

290x4 = 1160- 1/5(1160) = 928

928-600 = 328 FOR EVERYTHING ELSE BESIDES RENT for a month working full time.

how many fucking shiny coins you think most people at that wage level have? ill give you a hint, close to none unless you sell drugs on the side. how much debt would you reckon they have on top of all that?



Jean Valjean's picture

Actually you bring up a very valid point that should be fleshed out.  One thing I thing you are overlooking:

Innovation outpaces inflation and gives the illusion that "all's fair".  Let me use an example.  In 1963 you could buy a McDonalds hamburger for a dime.  In 1963 an average consumer earned 25 dimes an hour.  In 2011 a hamburger costs .80 and the average consumer earns 25 $.80 per hour.  All even right?  Not really because if the 1963 dime was saved it would be easily sold today for $2.70 or the equavalent of over 3 hamburgers.


Bicycle Repairman's picture

You have nailed it.  All of the value from innovation accrues to the bankers and not the people under the FED 'system'.

Bicycle Repairman's picture

You have nailed it.  All of the value from innovation accrues to the bankers and not the people under the FED 'system'.

Bicycle Repairman's picture

You have nailed it.  All of the value from innovation accrues to the bankers and not the people under the FED 'system'.

Bicycle Repairman's picture

You have nailed it.  All of the value from innovation accrues to the bankers and not the people under the FED 'system'.

Stuck on Zero's picture

Have salaries kept up with prices?  A $5/hr salary 40 years ago meant about $4.80 in your pocket to spend.  A $18 salary today means about $10 to spend.