Inflation at the wholesale level in the United States shows no sign of slowing down, according to the latest producer price index numbers released Tuesday by the Labor Department, which showed an 8.6% jump in wholesale prices in October compared to October 2020.
The producer price index measures inflation before the costs are passed off to consumers at the gas pump, the grocery store and any other place where goods are purchased. According to Labor Department statistics, a 6.7% jump in wholesale gasoline has caused prices to spike.
The Associated Press notes that a “scramble to meet unexpectedly strong demand has created shortages of labor, raw materials and goods and snarled traffic at ports and freight yards.” All of this has caused prices to surge and it’s expected to continue into 2022.
On Wednesday, the Labor Department will release last month’s consumer price index which will show a rise in prices to match the increases associated with the wholesale price increases.
The 8.6% wholesale price increase year-over-year ties the highest annual increase on record which has been tracked for the last 11 years.
While you’re paying more at the pump and for goods and services, there are bright spots for Americans who’ve watched their house prices skyrocket and, according to indexes tracked by CNBC’s Carl Quintanilla, household net worth jump to record levels, the “misery” index is hovering near 10%.
The misery index measures economic distress felt by citizens by adding the unemployment rate to the inflation rate.
1. Record-high stock markets/home prices
2. Record-high corporate balance sheets
3. Record-high household net worth
4. “Misery index” near 10 👀
— Carl Quintanilla (@carlquintanilla) November 9, 2021
On Monday’s edition of “Special Report,” Fox News senior political analyst Brit Hume argued that the Biden administration is “perfectly prepared” to let Americans suffer from inflation as part of their agenda.
“It looks to me as if this is an administration that was willing to sacrifice a lot on the altar of moving away from carbon-based fuels. And, you know, gasoline, obviously oil, coal, natural gas, all those in the interest of trying to save the planet,” Hume said.
“And they seem perfectly prepared to let consumers pay higher prices, perhaps ever-higher prices toward that end. And the consequence of that, I think, is, politically, even if inflation in other areas of the economy subsides, if people are still paying these sky-high, gasoline prices and other fuel prices, the feeling is going to be that this administration brought us inflation and it’s here to stay. Not good politically.”
Monday, the New York Times reported that “Winter Heating Bills Loom as the Next Inflation Threat.”
While finding sticker shock at the grocery store and every other place they shop, Americans are about to get a real dose of reality when their heating bills come due this winter, according to the newspaper.
“Natural gas, used to heat almost half of U.S. households, has almost doubled in price since this time last year. The price of crude oil — which deeply affects the 10 percent of households that rely on heating oil and propane during the winter — has soared by similarly eye-popping levels,” Times reporter Talmon Joseph Smith wrote.
“And those costs are being quickly passed through to consumers, who have become accustomed to cheaper energy prices in recent years and now find themselves with growing concerns about inflation this year.”
Are we having fun yet?