What Is Inflation Made Of?

My, my. Take a look at the wisdom of an expert:

"Energy is a killer, but if you don't use it, you're not seeing a whole lot of inflation," said Joel Naroff, chief economist at Naroff Economic Advisors, a consulting firm in Holland, Pa.

Wow. Don't you feel better? Many of Econo-Girl's friends use no energy at all. Of course, they are dead, but that doesn't count, does it?

Econo-Girl does not believe that something as systemic as fuel costs for electricity and gasoline can be dismissed so easily when measuring inflation. Because once the fuel-cost increases, eventually the price of everything else will increase also. So the rising fuel costs are future indicators of inflation that is being sown into the economy. Somebody tell Bush.


The Lazy Iguana said...

I have a friend who drives a big truck for a living.

He demanded more money from his boss on Monday. He said, flat out, that he would stop driving unless he was paid more per haul.

So, he is getting more per haul. This will make everything in the containers he hauls cost more.

But do not bother telling Bush anything. His hands are covered in crude oil.

Econo-Girl said...

Of course! It makes so much sense that if it is more expensive to get goods to market, then the price of those goods will go up.