Agora's 5-Minute Forecast quotes C Larry Pope, CEO of Smithfield Foods (reckoned to be the world's largest pork processor), as saying, "There's going to be real food inflation in this country," which is not news to me or anybody who eats; then he says, "I think we need to tell the American consumer that things are going up," like we consumers are a bunch of stupid halfwits who have not noticed that we are paying a lot more for everything, and have been paying more for a long, long time.
As part of my Assigned Mogambo Duties (AMD) here on planet Earth, I am to make disparaging noises when I think my Valuable Mogambo Time (VMT) is being wasted, so as to promote efficiency. So, per my mission parameters, I made a big, noisy farting noise, as virtually dictated under AMD, at my assessment
of his old "news", which I considered completely barren and worthless, and thus a complete waste of time.
But it turns out that when he blandly said that "things are going up" in price, he was just laying a trap for me! Too late I realized what was happening, and I revealed my ignorance of the extreme nature of the price rises, as he says, "We're seeing cost increases that we've never seen in our business."
I immediately latched onto that "never seen" phrase, as I still carry the psychic scars of my teenage years, when I invariably had to meet some girl's stupid parents, and then I invariably had to listen to some crap about how her stupid father had "never seen" such a loser as me, or had "never seen" such a worthless juvenile delinquent as me, or had "never seen" such a dangerous psychopathic lunatic as me and blah, blah, blah.
But price increases of such magnitude that they have never been seen before? And in the food business, which means that prices for food will rise faster (and probably higher) than at any time in history? Yikes! This is too, too, too freaking much!
The next thing I know, I am screaming out of the window: "Prices for food are going to go higher, and probably going to go higher than at any time in history, you laughable halfwits who keep voting for morons (except Ron Paul), to represent you in Congress, who then let the Federal Reserve create so excessively much money and credit that the rises in prices will destroy you, and I am going to laugh at you - hahaha! - as you crawl around in the filthy gutter in your misery, and I hope I am there to see your face when you realize that your stupid trust and laughable ignorance in letting the layers of fascist, socialistic, communistic governments literally become the American economy, and it cost you everything as the dollar went into the crapper and things exploded in price! Hahaha! Nice job of "democracy in action there, you lowlife morons!"
Addison and Ian of the Forecast obviously do not have any raving lunatics in their families and are obviously embarrassed about the "screaming out of the window" thing.
Their response is a little more calm: "Ahh ... inflation, the hidden tax, continuing in a grocery store near you."
And if you don't like those references, then check out the Pittsburgh Post-Gazette headline "Pittsburgh-area retail prices rise 3.4% in last half of '07", which is a lot of price increases in half a year!
The funny thing is that the article also remarked, "A market basket of goods and services that averaged $100 in the early 1980s would have cost Pittsburgh-area residents $203.30 in the second half of 2007." You will no doubt notice the smirk on my Stupid Mogambo Face (SMF), because this only comes to 2.8% annual, compounding inflation in prices over 25 years! Hahahaha!
Hell, Ben Bernanke of the Federal Reserve is on record as saying that he wants inflation to be about 2% a year! He calls it "inflation targeting"! Hahahaha! We're freaking doomed because this is crazy!
Okay, the point is well taken that hearing a crazy man talk about other people being crazy is probably not the best evidence, but inflation in prices is supposed to be zero or less! Not more! Inflation should be zero or less! And yet here is the foul Federal Reserve trying to cause inflation in prices!
I end the show with a heroic little scene, where I am alone on the stage, and I majestically raise one fist to the sky and proclaim, "Show me the economics textbook that says that inflation should not be zero! If not, then show me where gold and silver are sold, because, brother, that's the only thing that can save one's financial butt from certain ruination!"
The applause was not as thunderous as I had hoped, but the message is clear; "inflation targeting" means that we're freaking doomed!
Richard Daughty is general partner and COO for Smith Consultant Group, serving the financial and medical communities, and the editor of The Mogambo Guru economic newsletter - an avocational exercise to heap disrespect on those who desperately deserve it.
Republished with permission from The Daily Reckoning . Copyright 2008, The Daily Reckoning. |
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