One of the great mysteries of the whole easing era — the past five years of unprecedented intervention and activism orchestrated by Fed Chairman Ben Bernanke — is that it hasn’t led to rampant inflation…at least not yet.
While economists routinely strip out food and fuel when they look at pricing data to derive what they call a “core” figure, even the all-in figure has been eerily benign lately. The March consumer price index, or CPI, just released this morning, showed a 0.2% drop. But within the data, food prices remained flat, while the prior report showed a 1.6% increase in the food index over the past 12 months.
This “paltry” increase in food prices got Nick Colas, chief market strategist at ConvergEx Group, thinking. What if the items in the government’s basket were different than what real consumers actually buy?
As Colas explains in the attached video, so-called “shopping cart inflation” is anything but benign.
“The things that people most commonly shop for are increasing in price much more quickly than that CPI basket inflation number we’re used to seeing,” says Colas, singling out the spike in staples such as lettuce (+24%) and apples (+11%) in a recent note to clients.
You can see the full “Breakout” segment below:
Whole Foods Market, Inc.(NASDAQ:WFM)