OPINION – There sure are a lot of sober faces today. Some people are acting like the end times have arrived. What is the source of this doom and gloom?
For some it might be the fact that the television series Breaking Bad ended its five-season run last night. Fans will no longer have Sunday nights to look forward to or a show to discuss on Monday mornings. For others, it may be the impeding “government shutdown” we are being incessantly told to fear.
But one of the most truly sobering things going on around us hasn’t yet registered on most peoples’ radar. It’s the steadily rising effect of inflation driving up the cost of everything we purchase. But the reality of these rising costs is sometimes carefully disguised.
For starters, the Consumer Price Index deliberately excludes things like food and fuel when measuring rising costs of goods and services. The official explanation is that these items are considered more volatile. But this doesn’t change the fact that they are among the most essential items we purchase regularly and they are clearly being affected by inflation.
Food prices can fluctuate from season to season, but careful shoppers are catching on to the fact that even where prices have remained steady, quantities have decreased. Cereal boxes have shrunk; as have ice cream containers, candy bars, etc. Cans of tuna that used to be 7 ounces are instead being sold in 5 ounce cans. Next time you purchase a bag potato chips pay attention of how much of the bag is actually filled with air.
Marketing experts know that consumers are more sensitive to price changes than they are to quantity changes. So they quietly reduce the amount of food or the size of the packaging in the hope that we aren’t reading the labels too closely.
But the reality remains; we’re ending up with less food for more money.
Eric Peters states it perfectly:
“But it’s happening across the board – as anyone who shops for basic staples, food and so on, already knows. The bag of groceries that cost $50 five years ago now costs $70 – and there’s less in the bag, too. Gas costs twice what it did just five years ago. We’ve just gotten used to $3.40 as the New Normal.”
How does the public become so susceptible to having their perceptions manipulated? Part of the reason is that we no longer call things by their actual names.
Quantitative easing is a term used by the Federal Reserve as verbal camouflage for the purpose hiding inflation from the public. The money masters refer to it as injecting “liquidity” into the economy to make more money available. In reality, it amounts to the printing and pouring of tens of billions of manufactured dollars into the economy each month. All that unbacked funny money, in turn, waters down the purchasing power of every dollar.
Historically, such actions cannot be sustained indefinitely without destroying the money supply through hyperinflation.
Once the money supply begins to grow at an exponential rate, we will experience the kind of economic upheaval the Weimar Republic did in the 1920s.
Simon Black offers a powerful illustration of how an inflationary crisis can take so many people by surprise. He starts by asking us to suppose we were at a party where a pipe bursts at 11pm sending a small leak of water into the room. Few people would feel threatened by a steady trickle and would likely continue partying.
But when that leak becomes exponential, the situation changes drastically.
As Black explains:
“At first, there’s just one drop of water. But each minute, the rate doubles. So by 11:01pm, there’s 2 drops. By 11:02, 4 drops. And so forth.
By 11:27pm, there’s only six inches of standing water. Yet by 11:31pm, just four minutes later, the entire room is under nearly 8 feet of water. And the party’s over.
For nearly half an hour, it all seemed safe and manageable. People had all the time in the world to leave, right up until the bitter end. 11:27, 11:28, 11:29. Then it all went from benign to deadly in a matter of minutes.”
Those rising prices and shrinking quantities of the food in our grocery carts are serving as our canary in the coalmine.
Now would be a good time to become better informed and to formulate a personal game plan for protecting your assets and keeping food on your table.
Bryan Hyde is a news commentator and co-host of the Perspectives talk show on Fox News 1450 AM 93.1 FM. The opinions stated in this article are his and not representative of St. George News.
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