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The Truth About 2007 to 2010 Inflation NumbersKal Gronvall Consumer Price Index (CPI) – the big lie Two things are certain about our government. They continually deceive us through their mouthpiece the media, and all of their government numbers or statistics are lies. For example, the Consumer Price Index (CPI), which supposedly measures inflation, is figured without including food, fuel, or housing. Now if you leave out those three categories you remove about 95 cents out of every dollar Americans spend. So why do they cook the numbers like that? First, they want to keep the public dumbed down, sedated, and confused so no one thinks about revolting, rioting, or uprising. Secondly, and probably the biggest reason is that they don’t want to give those living on Social Security a cost of living increase. Why? It would cost them too much to do something good, and that’s not in their genes. They have better places for that money than to waste it on regular retired people trying to survive. Why not funnel those tens or hundreds of billions of dollars to lavish on themselves via banker bonuses and expanding their spoils-of-war, military-industrial-complex coffers? That’s a much better place for the funds. No cost of living increase for last two years For the last two years the government has determined, through their cooked and crooked numbers, that there hasn’t been any inflation. And, consequently, based on that big lie, they have not given those living on Social Security a cost of living increase. In the mean time the Congress has voted themselves between a $3,500 and $4,500 per year increase in each of their salaries. Nice. Speaking of inflation and a cost of living increase, I just completed a chart on real inflation numbers. The numbers in the chart below tell the story much better than I can in words. I will simply make a few observations about the main points of the numbers charts. I took the commodity and stock market numbers from September, 2007, to September, 2010, from the International Futures Charts, and the metals numbers from Kitco.com. First, I looked at eight different commodities which impact the cost of goods, products, or services in the all the big three, food, fuel, and housing, the ones left out of the government’s CPI number. Then I took numbers for the main four metals, gold, silver, platinum, and palladium. Then I isolated gold and silver as monetary metals. Then I looked at the four major stock market numbers to see what they have done over the three year period. Chart observations I will let the numbers from these charts do the talking, but some things are obviously evident. First, the government is lying to us again as usual. Inflation on the eight commodities has been an overall 55.63% three year increase, and an 18.54% per year increase over the last three years. All one has to do is go the grocery store every week to face that reality. It has always been said that the metals respond to inflation, and, if you will notice, there in an uncanny relationship between the two as we look at the four metals’ numbers, with an overall 56.25% three year increase and an 18.7% per year increase for the last three years. Gold and silver shine Then I compared gold and silver together, the two monetary metals. The reason platinum and palladium have not risen at the same rate as gold and silver is because they are industrial metals, and industry has suffered immensely in the world wide depression that we have been in for the past three years. The reason that gold and silver have risen so rapidly is that the world is fleeing into gold and silver as a safe haven in these chaotic economic and financial times. Gold and silver together have risen in value by 73.5% in three years with a 24.45% increase per year. Not only have gold and silver responded to actual inflation, but they have outpaced it by 6% each year. Stock market – a disaster Now for the good news for those in the stock markets. It doesn’t take too long by looking at the stock market numbers to see that they have been a disaster for the last three years. Notice that they have all decreased by 24.8% over three years for an average of 8.25% per year drop. If you add the three year rise of 73.5% for gold and silver and the 25.8% drop in the stock markets we see a total spread of 98.3% for the past three years, for a 32.6% spread each year. No need to say any more - - the numbers speak for themselves. Where would you rather be with your money? The “carry trade” gravy train I have one more interesting observation to make about the stock market, commodities and the bankers. Remember the too-big-to-fail banks received over one trillion dollars of taxpayer bailout money about two years ago? They didn’t loan that money to the public or small businesses to stimulate the economy as the government said they would. They just sat on it as their reserves in their Fed accounts, collecting interest on it in the name of having enough cash cushion for a future financial disaster. What they are really doing with the bailout money is buying each other’s stocks and doing the “carry trade.” The carry trade is buying commodities, like the ones I have listed in the chart. And, judging by the 18.54% increase in commodities each year for the past three years you can see at a glance that they are making tons of money on your money. Not bad for a hard day’s work, especially when they are doing “God’s work” in the process.
Commodity and stock market numbers taken from the International Futures Charts. Metals numbers taken from Kitco. ### Kal Gronvall 321gold Ltd |
