Bankrupting the Common People

The Illuminati uses a variety of tools [one being 'physical']... The objective, as stated by one of their main spokesmen, Henry Kissinger, is to take control of food and oil. By controlling oil, they control the militaries of the nations of the world. By controlling food, they can control individuals ... The 'Global 2000 Report,' written by former Secretary of State Cyrus Vance, declares that the world needs to be depopulated"... by means of limited wars in the advanced countries and by means of starvation and disease in the Third World Countries, the death of three billion people (described as 'useless eaters') by the year 2000. - Liberty Lost, F. Gregory Anderson, Circa 1993

Inflation Up 2.3% from Last Year, Gasoline Prices Have Soared 41.1%

April 14, 2010

USInflationCalculator.com - Inflation remained tame in March, as U.S. consumer prices edged only slightly higher due mostly to higher fresh fruits and vegetables costs, the Labor Department reported Wednesday.

The Consumer Price Index, the government’s most closely watched reading for inflation at the consumer level, rose 0.1% in March. February’s CPI was flat and marked the first time prices had not advanced since March 2009.

"Inflation as a concern is relegated to the distant future," Guy Lebas, chief fixed income strategist at Janney Montgomery Scott LLC in Philadelphia, said on Bloomberg. "It gives the Fed the flexibility to keep rates low for a while."

Helping to keep prices contained in March were flat energy prices, as increased electricity costs were offset by lower gasoline and natural gas bills. For the past year, however, energy prices have soared 18.3%, with gasoline leading at 41.1%.

Those costs drove inflation up 2.3% over the past 12 months compared to a 2.1% increase the Labor Department reported during the 12 months ending in February.

Core consumer prices, which strip out volatile food and energy prices, were unchanged during the month of March. While core inflation was still up 1.1% from a year earlier, it was the smallest gain since 2004. Month prior respective increases were 0.1% and 1.3%.

"The rate of inflation was very low this month and still somewhat below the historical average," Andres Carbacho-Burgos, an economist for Moody’s Economy.com, was cited on CNNMoney.com. Adding that the annual rate has historically been between 2.4% to 2.5% and core inflation rate between 1.7% to 1.8%.

The 12-month core inflation rate is right within the Federal Reserve’s comfort range of 1%-2%.

Inflation Adjusted Gasoline Prices

December 11, 2009

InflationData.com - Back in 1980 - 81 we were shocked as gas prices rose above $1.00 for the first time. This was especially shocking because just four years earlier in 1976 gas was $0.60 per gallon and in 1969 it was only $0.35 a gallon. But by 1981 only 12 years later it was a full dollar higher at $1.35. That is an increase of 286% in 12 years!

In 1981 that $1.35 would be the equivalent of $3.21 in inflation adjusted terms for 2009 dollars.

Compare that to the price increase from 1998 where the average price was $1.02 and by July 2008 it had increased to $4.02 and you have a 294% increase in 10 years. But that is to the monthly peak price. Amazingly the average price for all of 2008 was $3.23. Almost identical to the price in 1981 when adjusted for inflation.

Interestingly, the average price of a gallon of gas from 1918 to the present is $2.37 in inflation adjusted dollars.

If we look at the average annual Inflation adjusted gasoline prices for each of the following years (1958, 1968, 1978, 1988, 1998, and 2008) we see the following:

Inflation Adjusted Gasoline Prices:

Year & Price

1958

$2.24

1968

$2.11

1978

$2.16

1988

$1.75

1998

$1.35

2008

$3.23

2009

$2.28

So if the long term average price is $2.37, then in 1988 gas was very cheap and in 1978 it was only slightly below average; but in 1981 and in 2008 it was extremely expensive on a historical basis.

In 1998 gas had gotten really cheap by historical standards allowing people to buy gas guzzlers like SUV's and Hummers. But that reversed in 2008 as prices rose above the long term average.

As of this writing, the monthly average price of gasoline in November of 2009 was $2.61 just slightly above the long term average price of $2.37, with the Annual Average for 2009 at $2.28 being extremely close to the long term average.

Remember that these are average annual prices and individual months had much higher averages and on a weekly or daily basis prices could (and did) spike much higher.

According to the US Energy Information Administration, the average price of a gallon of gasoline in March 2008 cost $3.21 ... although I know in many places like California people would have been glad to find gasoline for $3.21 a gallon so in addition to averaging over time it is also averaging over the whole country.

I spent several weeks driving around California in March 2008 and often saw gas closer to $4.00 a gallon and then actually saw $5.00 a gallon in May in Alaska. Granted that was more of a supply/demand issue (it was the only station for a hundred miles and all the gas actually came from a refinery thousands of miles away). The irony of the matter was across the highway within site of the pump, was the Trans-Alaska pipeline, transporting crude on the beginning of its thousands of miles trip.


The chart above right shows the Average annual Gas prices in nominal terms (what you actually pay) and in inflation adjusted terms (red line) ...

Income Falls 3.2% During Obama's Term

April 13, 2010

Washington Times - Real personal income for Americans -- excluding government payouts such as Social Security -- has fallen by 3.2 percent since President Obama took office in January 2009, according to the Commerce Department's Bureau of Economic Analysis.

For comparison, real personal income during the first 15 months in office for President George W. Bush, who inherited a milder recession from his predecessor, dropped 0.4 percent. Income excluding government payouts increased 12.7 percent during Mr. Bush's eight years in office.

"This is hardly surprising," said Douglas Holtz-Eakin, an economist and former director of the nonpartisan Congressional Budget Office. "Under President Obama, only federal spending is going up; jobs, business startups, and incomes are all down. It is proof that the government can't spend its way to prosperity."

According to the bureau's statistics, per capita income dropped during 2009 in 47 states, with only modest gains in the other states, West Virginia, Maine and Maryland. But most of those increases were attributed to rising income from the government, such as Medicare and unemployment benefits.

Two of the most populous states in the country reported dramatic declines: Per capita income in California dropped 3.5 percent to $42,325; in New York, the drop was 3.8 percent to $46,957.

"The evidence from New York and California reinforces a basic lesson: Where government gets too large, prosperity suffers. Let's hope that the Congress learns this lesson before it is too late for the country as a whole," said Mr. Holtz-Eakin, who also served as chief economic policy adviser to Sen. John McCain's 2008 presidential campaign.

On the campaign trail, Mr. Obama often derided Mr. Bush for what he said were dramatically falling incomes for workers.

"American families, since George Bush has been in office, have seen average family incomes go down $2,000," Mr. Obama said in a September 2008 speech on the economy in Green Bay, Wis.

The bureau, which doesn't compile statistics on "family" income, reported that per capita income rose during Mr. Bush's two terms, from $29,159 to $32,632 (using 2005 dollar values as a base). During Mr. Obama's 15 months in office, per capita income has dropped nearly 1 percent to $32,343.

Economists agree that Mr. Obama inherited a severe recession, although some dispute that it is the "worst since the Great Depression," as Mr. Obama often asserts. Still, the dropping numbers show that the $862 billion stimulus package has not turned the tide on dropping incomes.

"All in all I think the [bureau's] data are just another confirmation of what we all know -- the recession has been just brutal, and while we may in the past couple of months have stopped the downward slide in jobs and incomes, we'll be digging out of a big hole for a long time," said Josh Bivens of the Economic Policy Institute.

Carol Moylan, chief of national income and wealth division at the Bureau of Economic Analysis, said comparing real personal incomes while excluding government payments is a good barometer.

"A lot of people like that number," she said.

The White House did not respond to requests for comments on the numbers.

Personal income with government "transfers" -- which include such federal money as Social Security, unemployment insurance, Medicare and food stamps -- has grown during Mr. Obama's time in office, up 1.2 percent from January 2009 to February 2010. During that period, government unemployment insurance benefits rose from $88 billion to $143 billion.

Despite a near doubling in unemployment payouts, Mr. Obama in February announced a multitrillion-dollar spending plan that boosted the federal deficit to a record-breaking $1.56 trillion.

"While the market income of Americans has fallen since early 2008, government assistance has offset this somewhat through greater transfer spending such as unemployment benefits and new tax credits such as the 'making work pay credit,' albeit at the expense of higher deficits," said Gerald Prante, a senior economist at the Tax Foundation organization.

Mr. Obama, who just finished pushing a $1 trillion health care reform bill through Congress, is falling behind on his predictions.

In a September speech, he said: "All in all, many middle-class families will see their incomes go up by about $3,000 because of the Recovery Act."

Other numbers show dramatic differences between the state of the economy in the opening months of Mr. Bush's first term versus that of Mr. Obama. While disposal income during Mr. Obama's term has risen $2.5 billion, extra cash for Americans rose $113 billion over Mr. Bush's first 15 months in office.

Meanwhile, the findings of a new survey of leading economists by the Associated Press found widespread pessimism over a quick recovery. The finding included ominous news:

The unemployment rate will stay high for the next two years and still be at 8.4 percent by the end of 2011.

Home prices will remain almost flat for the next two years, even after dropping an average 32 percent nationwide since peaking in 2006.

The economy will grow about 3 percent this year, less than usual during the early phase of a recovery, but few jobs will be added.