"Prices for food in U.S. grocery stores jumped 6.6% last year - the biggest spike since 1980 - underscoring yet again that inflation is a much bigger problem than government officials, or most economists, say it will be.
Of all food categories, prices for cereal and baked goods hit U.S. consumers the hardest, zooming 11.7% in 2008 over 2007. Prices for meats, poultry, fish and eggs gained 5.1%. Fruits and vegetable rose 3.4%, while dairy products advanced 2.7%. It was the second straight year U.S. consumers were forced to pay a lot more for their groceries. In 2007, food prices at supermarkets rose 5.6%. Prices rose only 1.4% in 2006.
Consumers had to pay the price last year because food makers battled the largest spike in commodities they’ve ever faced, walloped by duel increases in key food ingredients and fuel, which all marched to historic highs in July, a month in which crude oil peaked at an all-time record of more than $147 a barrel.
This major escalation in food prices calls to question contentions that inflation is not a problem, a stance that - on the surface - appears to be supported by government statistics that appear to be fairly benign."
Read the full article: "Big Jump in Food Prices the Latest Suggestion That Inflation is Much Higher Than the Government Says". This supports Greenspan's recent dismal prediction that "the current global recession will "surely be the longest and deepest" since the 1930s". This is a unique and fascinating time to observe the innovative pricing strategies that businesses put into play to survive the current crunch in consumer credit and expendable income, and to witness first hand how powerful a role pricing plays in global economics.
Although these times are presenting incredible challenges, this presents an excellent environment for new pricers to learn solid principles to bolster their future careers, and for experienced pricers to apply pricing theories in new ways to their pricing operations. Do our readers agree? Warmly, EM
No comments:
Post a Comment