Fat Americans In Pick-Ups Push PPI Up

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Inflation rose faster than expected last month, up 1% driven high by food prices and gasoline. Looking at the numbers year-over-year, the increase was over 7%. According to MarketWatch "This is the fastest pace since 1981." That is called inflation plain and simple. It can no longer be referred to as inflationary pressure or upward price trends.

To some extent, American habits play into the rise in costs for agriculture products and oil. In places like Japan most of the population does not spend their time in Dunkin’ Donuts and driving around in 10 MPG pick-ups that never haul anything more than the family dog.

Inflation, especially built on the current increase in commodities can be fixed, at least in part, by the government offering tax incentives to people who buy foods which are not processed. Or, the government could tax fried foods the way it does booze and coffin nails. The same holds true for cars. A tax break for a Prius and an extra tax for a Ford F-150.

Inflation is not a foregone trend, as long as consumers get a financial reason to make a modest change in habits. It would be a better way to spread money around than simply sending out tax rebate checks.

Douglas A. McIntyre