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May PPI Jumps Due To Rise In Gasoline, Electricity, Eggs And Imitation Cheese Production Prices
So much for continued disinflation: moments ago the PPI headline number came out at the highest level since February, or 0.5%, well above the expected 0.1% and up significantly from the -0.7% in April. The core PPI ex-food (which rose 0.6%) and energy (increasing 1.3% in May, the highest since February) rose a far more manageable 0.1% in May, and just 1.7% Y/Y, below the statutory accepted 2% annual growth on both the producer and consumer side: a break down of just which finished products led to this increase (gasoline, eggs and imitation cheese as it turns out) is provided below. Luckily, since nobody in the US either eats or uses energy (because they are such a "small component" of the hedonically-adjusted purse), nobody will mind when companies have no option but to pass through rising input costs to consumers.
A quick snapshot at the input part of the production pathway: crude goods.
Crude energy: The index for crude energy materials moved up 5.0 percent in May. From February to May, prices for crude energy materials decreased 0.4 percent compared with a 7.4-percent rise from November to February. In May, nearly sixty percent of the monthly broad-based advance is attributable to the crude petroleum index, which rose 5.5 percent. Increases of 6.9 percent for natural gas prices and 1.0 percent for the coal index also contributed to the higher crude energy prices.
Crude foods: The index for crude foodstuffs and feedstuffs increased 2.1 percent in May. For the 3 months ended in May, crude foods prices rose 1.3 percent after falling 2.0 percent in the previous 3-month period. Accounting for half of the monthly advance in May, grain prices jumped 5.7 percent. An increase in the index for soybeans also was a factor in higher crude foods prices.
Crude core: The index for crude nonfood materials less energy fell 2.3 percent in May. From February to May, crude core prices dropped 4.1 percent compared with a 0.5-percent decline for the 3 months ended in February. Over sixty percent of the monthly decrease in May is attributable to the index for carbon steel scrap, which fell 6.3 percent.
And the headline-driving finished goods:
In May, over sixty percent of the broad-based rise in finished goods prices is attributable to the index for finished energy goods, which advanced 1.3 percent. Also contributing to the increase in finished goods prices, the index for finished consumer foods rose 0.6 percent and prices for finished goods less foods and energy moved up 0.1 percent.
Finished energy: The index for finished energy goods moved up 1.3 percent in May following two consecutive declines. A 1.5-percent rise in the index for gasoline accounted for forty percent of the May increase. Higher prices for residential natural gas and residential electric power also were factors in the advance in the finished energy goods index.
Finished foods: The index for finished consumer foods climbed 0.6 percent in May after falling 0.8 percent in the prior month. Accounting for over sixty percent of the increase, prices for eggs for fresh use surged 41.6 percent. A rise in the index for natural, processed, and imitation cheese also contributed to the advance in the finished consumer foods index.
Finished core: In May, prices for finished goods less foods and energy moved up 0.1 percent, the seventh consecutive increase. Nearly two-thirds of the May advance can be traced to prices for light motor trucks, which rose 0.4 percent.
In other words, the Fed's monetary transmission mechanism made it to gas, eggs and imitation cheese. All other products, not so much.
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What matters is the price of bull shit aka manure ? That is going down. Voila - you have deflation.
As a man who eats 5-egg, cheese omelets daily and drives around the country in a Suburban,
I am very concerned about the price increase in these commodities.
Man what about your cholesterol ???
Does the imitation cheese-like product fall under food or energy?
pods
:) ..depends. leave it outside, if it decomposes, its food. ..if its that plastic shit that leaves McDonalds burgers immaculate after 3 weeks in the garden, then energy is probably a better categorization.
Who took my cheese substitute? Oh by the way greetings to all you NSA algos and employees who are scanning this post (I am quite sure ZH gets "special" treatment on these matters.
MOAR CHEDDAR!
www.marksdailyapple.com
great site! Eat the eggs, skip there flour. Gluten and sugar are the enemy.
Transitory!
Edit: I just realized that I love big brother. I'm going out to buy an iPhone with the more GBs today. I'm going to vote along the correct party lines for bigger, more powerful government, and enjoy my days as a debt slave while I wait for the coming Marxist utopia.
I <3 u NSA! XOXO
Inflation is already in the US and quickly increasing.
In the mean time Bernanke, Evans, Dudley and Yellen are pushing inflation even higher.
i can haz moar qe pleez?
Excuse me, I've got gas from the eggs and I just cut the cheese... (fifteen year old humor).
Smegma Cheese, the new oddly flavored artificial sandwich spread, made form 100% natural ingredients.
Shake well before using.
"Holy crap, what is this shit? It tastes like a sweaty jockstrap!"
Available anywhere good Soylent Green is sold.
Soylent Cream?
Fumunda cheese. Really best here in FL with the heat and humidity...
And I think the Unicorn is still $13 can so what's the fuss?
http://www.thinkgeek.com/product/e5a7/?srp=2
Excellent source of sparkles!
In case anyone is exhausted by the constant barrage of news on here and wants to take a break and read the matrix news, here's some. Enjoy.
http://www.nypost.com/p/news/national/tampa_thought_found_raping_guilty_Amq6PQQUYsVanNAEFp2WXK?utm_campaign=OutbrainA&utm_source=OutbrainArticlepages&obref=obinsource
"Because my husband puts me first, he's taking me to the Waffle House," Flores said...
http://www.nypost.com/p/news/international/having_sets_and_video_camera_year_BYX3ukhiAiTYc9Y45U025O?utm_campaign=OutbrainA&utm_source=OutbrainArticlepages&obref=obinsite
Would you like cheese with that waffle?
Lol that is some funny shit.
A 16-yo Patrick Swazey as He-Ghost!
Funny, but my actual inflation tracking shows Y/Y is @16.6%.... of course, I don't buy electronics or furniture or new cars, etc....
My numbers are based on "real" inflation items, like food, heating oil, gas, clothing, household goods and utilities... stuff we buy every month.
On a side note, I love the "2% inflation target is good for economic growth" meme. What a bunch of BS! If you don't get a raise that keeps up with inflation, 2% is an equivalent pay cut. You fucktards don't understand that falling wages and rising inflation is an economic handicap. Holy shit... you are the dumbest people in the room, and you're running the CENTRAL FUCKING BANK!
They are not dumb, not be a longshot.
They are making sure the biggest debt issuer gets the 2% inflation skim.
Because they are married to them.
The FED gets to run the racket as long as the government can skim 2% of everyone holding dollars.
Symbiotic relationship between parasites.
pods
Sad day when the price for a thin slice of edible plastic starts to rise.
Long hens
Well now they have gone and screwed the pooch. Canned cheese going up in price? Now we will see the ire of the American populace for sure!
But it's designer artificial cheese made form all natural organic products!
In blind taste tests, Smegma brand prepared cheese was favored over spoilt Arab falaffel flavored socks by a resounding majority of people you'd never want to be amongst in dark rooms with sharp objects.
This is so tragic. Middle income and working poor families are barely stretching their income as it is. I can't imagine having to choose between eggs or milk, bread or meat, or saving the car for exclusive use to drive to work and back and forego any family outtings. Third world nation status creeping ever closer to a city near you.
'Artificial cheese'...is that the QE?
Nice.
:)
Fed is so scared of deflation they will push right into hyperinflation.
You simply must hear this, zerohedge theme song! "5 pound blocks of cheese..."
http://www.youtube.com/watch?v=OBQLGq8L2cY
Imitation cheese prices rises? Can we have imitation of an imitation cheese? I am sure Kraft can do that easily. Velveeta sells well in Cleveland. Imitation Velveeta may sell even better. No one has ever lost money underestimating the taste of the American people.
Kraft likes to call it a "fun, family-friendly" food.
Imitation cheese and grape drink. You know, fine dining. http://www.youtube.com/watch?v=NuTjQLfU6Gk
Don't you just love how people who eat $500 lunches talk about the price of simple things like eggs, butter, and milk...'for the peasants, you know', it's a put-down.
CPI Using: Todays computation 2%
Using 1990 computation 4.5%
Using 1980 computation 9%
Bad news... change the rules!
All is good, Nothing to see, Move along
Curiosity is the only thing prompting me to ask this question.
How do you know, or how can I find out, the way CPI was determined back in 1980 and 1990?
TIA.
Easiest way - www.shadowstats.com
I guess Economist back in the 1980's were not as smart as the ones we have today.
I was curious as to whether falling wages could be attributed to inflation. Any precedence for that?
The Fed apparently wants an excuse to slow down QE without crashing the market.
Will the G8 be eating cheese food in a Potemkin Village while they hunt for leprechaun gold?
They'd be dancing at the end of a rope sporting Angel lust in their pants if there was any justice in the world.
... under a rainbow
Inflation problem? Well I'm sure if we just print more money we'll be fine.
Wheres my cheese whiz boy!
Inflation is simply a cost of business and like taxes is simply passed on to the consumer. They could care less how much it is and the more the better as they always get their markup. You will also note that while prices may go up to reflect infaltionary costs they are very slow to come back down, regardless of inflation or taxation. As we have seen with fuel, rising prices are blamed on outside factors, but effectively soften the market, so when those factors diminish high prices linger. Upward racheting. Inflation inflating the bottom line, all at a cost to the consumer.
Let us taper.
Higher prices. Bring higher tax revenues.
Curious spike in silver price few min ago, could it be related?
MOAR CHEEZE PLEEZE!!!!
These will leak into CPI readings, it's that simple....well, unless the govt. "tweaks" the way inflation is reported, again.
The new CPI headline:
Inflation tame, prices moderate, market ralies.
Fine print will read:
The govt. reported today that consumer inflation was tame and steady when stripping out food, utilities, gasoline, healthcare, education and anything else that you need to live.
The slight increase in food prices last month can partly be blamed on sharp demand for eggs for the Mother’s Day and Memorial Day holidays, which drove prices up more than 40%.
From the LA Times.
Easter Eggs I have heard of.
Well of course! I and my family always celebrate Memorial Day by re-enacting the great battles of history in the backyard using eggs as missiles. We go through a few gross every year. Why, how do you celebrate?
Saw dust burgers and Piels tall necks.
Detroit welfare "Niggers" don't deserve our best extra sharp, export quality "White Cheddar" .... they don't like it anyway .... it's not part of the low tech African blood, milk and urine wrapped in cow dung African tradition .... they prefer "White" bread and imitation "Yellow" cheese ! Monedas 1929 Comedy Jihad Rainbow Coalition Green Cheese World Tour
It takes pretty smart and skilled craftsmen to make large hole Swiss cheese .... or many of the other fine cheeses of the European tradition ! In Africa .... cheese was an accident of nomadic starvation ! There is no tradition to remember .... if they forget the "recipe" .... when they get hungry enough .... they will re-invent the casual concoction ! Monedas 1929 Comedy Jihad Humour Outreach World Tour
Louis Cyphre: You know, some religions think that the egg is the symbol of the soul, did you know that?
Harry Angel: No, I didn't know that.
Louis Cyphre: Would you like an egg?
Harry Angel: No thank you, I got a thing about chickens.
[Louis takes a bit out of an egg with a dangerous look on his face]
Food and energy are not part of the CPI. They go up and down too much.
So does a hooker's head. I guess that's why the cost of blowjobs aren't figured into CPI.