The government reported CPI went up 5% in May.
Source: WaPo
Though Biden and his team of free-spenders are sanguine, ordinary folks are starting to notice.
Let’s look at a couple of benchmarks…
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Gasoline
Key consumer benchmark: gasoline prices … they’re up a whopping 47% in the past year.
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Housing
Zillow says that the price of a typical mid-tier existing home is up 13.2% over the past year … and is projected to go up another 14% this year … for a combined impact of almost 30%.
The price of new homes is skyrocketing … in part, because of the almost quadrupling of lumber prices.
According to CNBC the surge in lumber prices in the past year has added $35,872 to the price of an average new single-family home … which translates to about $15 per square foot … just for lumber!
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Food
The measured CPI for food rose “only” 2.2% in the government calculation.
Many (most?) consumers scoff at the 2.2% number … and benchmark their high volume staples (e.g milk, diapers) or personal favorites.
For example, a Homa family benchmark is the price of an Arby roast beef sandwich.
Not that long ago, Arby would regularly promote the sandwiches at 5 for $5.
Earlier this year, Arby’s went to 5 for $10.
Now, my price scouts report that an Arby’s roast beef sandwich regularly costs $4 …and the special is 2 for $6 … at $3 a sandwich, that’s up 50% from earlier this year, and triple the price from the good old days.
Ouch.
This inflation thing is getting personal….
The Homa Files 
June 14, 2021 at 10:53 am |
In fairness, to be more precise, it’s Arby’s beef and cheddar sandwiches that are typically $4.59 and currently “on special” of 2 for $6 (not the original roast beef). The CPI numbers are BS because of the way housing is treated (33% of the index and shown as a rental equivalent of 2% instead of >12% for the underlying asset, as you point out), as well as falling prices for consumer electronics, which has always been the case throughout time; when I was a teenager, the first flat screen TVs sold for $10,000… now you can get a 55+ inch HD TV for under $500. CPI also includes obsolete goods like calculators and IMO understates the cost of rising tuition, which for many people is a debt load they carry for a decade or more. Any way you slice it, it’s a big problem and there’s no solution given budget deficits and national debt. Can’t just raise interest rates anymore to combat inflation – you’d need to tax all income > 100% to dig out of this hole. Next step is for USD to lose reserve currency status. Check out today’s remarks from Paul Tudor Jones on what that ultimately means.