Food inflation - US Government says 9.5%...My Budget says 22%!
Food Budget.
So I did the budget today, and our food budget, on a 12 month moving average, year-over-year, has gone up 22.3%. The government says it only went up 9.5%.
We don't waste any food and we usually buy the same stuff. We make a lot of our food, so we buy a lot of raw materials, not much “ready-made” food.
Why does the Government get it so wrong?
How does the Government measure food inflation?
The BEA and BLS (Bureau of Economic Analysis and Bureau of Labor Statistics) uses the Personal Consumption Expenditures Price Index to measure food inflation. It takes a basket of goods bought by US consumers:
- Cereals and bakery products
- Meat poultry fish and eggs
- Dairy and related products
- Fruits and vegetables
- Non-alcoholic Beverages and beverage materials
- Other food at home
“BLS representatives visit (online or in person) or call various stores across the country and record what different items cost. During each trip, the data collector records the prices of the same goods….” Prices in most major cities are collected every month.
Tax brackets, plus state and local taxes, are used to offset some of the inflation. Substitutions of similar items are also calculated in…like in April apples are less expensive than peaches in certain locations, and then in May peaches are more expensive than apples…and people buy the less expensive fruit.
Each location has an average food budget that consumers spend, and then all locations in the US are averaged together, and those averages are compared month-over-month and year-over-year, to create inflation statistics.
All that said…
Food inflation in the US is 9.5%, in our state, it is 13%, and in our city, 8.5%...but the fact that our budget is at 22%, shows a significant spread from the official averages.
Whether this is on purpose, or just borderline incompetence, government at all levels need to do a much better job at computing inflation for the people that ACTUALLY buy the damn food.
Stay frosty people.
35% allocated to ph-fund.
Greetings @fijimermaid thank you for sharing this type of statistical analysis of how the inflationary process moves based on food, it allows us to anticipate the consumption process of society.
Greetings
Thanks for reading :)
i believe that that is one of the reasons why making decisions based on average and mean would lead to a lot of miscalculations. If any statistical approach is to be used, lean six sigma should be considered in order to make accurate decisions.
Never thought about that, using lean Six Sigma. Yeah, all costs are pretty much local. You should trust your own budget, rather than a bunch of bureaucrats a 1000 miles away.
most stats don't apply. thanks for sharing
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Thank you @alokkumar121.
Yes it is always a game of persepctive on these inflation numbers! The problem is that the basket is being changed the whole time and the items are sometimes questionable!
I fear that the numbers could even go higher with the Ukraine war still happening due to the reason that Ukraine and Russia are some of the world's biggest food exporteurs.
Yeah, the war doesn't help :(
Hello friend, I know that the situation there is not easy at all, really in the world everything is more complicated and inflammation is rising every day. It is unfortunate. I think the governments don't care, they will always be better off than the people. Greetings.
Thank you @franyeligonzalez :)
I hope inflation is down to around 2% by next year...hopefully without a recession.