LESS FOR MORE

REF: "Americans are Getting a lot Less but it's Costing Them More" by Richard Benson, July 27, 2010 www. 321gold.com

It has been going on for awhile now, most have noticed it, some just sub-conciously. Amounts in packages have been decreasing. Some packages are getting smaller, and maybe quality is not quite what it used to be. The reason: Price Inflation--Less for More.

Those who use statistics and numbers instead of their common sense , eyes and ears may not be aware of the inflationary trend. If you rely on the bureau of Labor Statistics or CNBC news for your information, you will soon be overwhelmed by the change in reality. As the Russian living under communism said: "my eyes don't agree with what I keep hearing".

Mr.Benson writes: "Inflation is defined as the rate at which the general level of prices for goods and services is rising, and, subsequently, the purchasing power is falling. I’ve always thought of inflation in terms of what we get and what we pay, but quality and service are as important as quantity, for the price. . .

Cereal boxes are only half full; yogurt has shrunk to six ounces from eight; tuna cans are now five ounces from six; candy bars are half their size, and newspapers are shrinking and may totally disappear. (Reporters are expensive, so picking up and printing government and corporate news releases is now considered serious reporting.) A meal at a local restaurant tasted like yesterday’s leftovers and the portion size dwindled, but the price was higher.

Also, if you can afford to go on vacation, you’ll become an unpaid travel agent working for the airlines, car-rental companies, and hotel. That’s right. I recently had to spend my valuable time on the internet doing the research then booking and paying for a trip. Then, to top it off, I had to use my computer, printer, and paper at my own expense. When I got to the airport, I was strip-searched and forced to pay extra for an exit row, to check a bag, get a pillow, blanket, and a meal. Then, I had to waste an hour of my life in a long line while being forced to take off my shoes in honor of the shoe bomber and pay my respects to the TSA, who added a fee to my airline ticket. When I picked up the rental car, airport fees and taxes pushed the cost up by a third for an older car that wasn’t well-maintained. (The major rental companies are hanging on to their cars until they are close to breaking down.) When I finally arrived at the hotel, I was hit with a resort fee, internet fee, and daily telephone charge each time I looked at the receiver. I was careful, too, when approaching the mini-bar in the room because the motion detectors inside would bill me for food and beverage items that were examined and put back but not consumed (a bottle of coke was $5). The taxes were horrendous and I wonder if the maid service and extra towels or pillows were bundled in the final bill.

Every time I turn around, it seems like we’re getting less but paying more. Believe me, none of this “less for more” is appearing in the Consumer Price Index. I even heard the other day that postage was going up another two cents for a First Class letter, and Saturday delivery may be eliminated altogether. If you’re dealing with the government, there is no such thing as First Class. State and local governments have closed parks, cut back on trash collection, road repairs, library hours, and laid off teachers. Meanwhile, taxes are going up and property values are going down. In New York City, they announced a major cut in bus and subway service along with a fair increase. When it comes to public services, the collapse in services – especially in cities - will be monumental and nowhere is it reflected as a major price increase for services actually rendered.

When examining my recent cable bill, I thought back to the old days when TV was free before you had to pump your own gas and wash your own windshield. The electric bill was up again, too. (In Florida, we get a special assessment to help pay for new solar plants and the summer has had record heat.) Lastly, my health insurance will go up the usual 20% next year yet I’m told by our elected officials to have a nice summer on our beautiful beaches that are threatened by the oil spill."

Benson goes on to complain about the hedonic adjustments made in the CPI where if the product is better, faster or more serviceable, that counts for a lower price in the index.

Dream on beautiful dreamer. You are in for the ride of a lifetime-- there is much more of this to come Mordeci.

With Love and Kindness,

THE HATMAN