This article was originally published by Michael Snyder at The Economic Collapse Blog.
Did you know that the price of corn has risen 142 percent in the last 12 months? Of course, corn is used in hundreds of different products we buy at the grocery store, and so everyone is going to feel the pain of this price increase. But it isn’t just the price of corn that is going crazy.
We are seeing food prices shoot up dramatically all across the industry, and experts are warning that this is just the very beginning. So if you think that food prices are bad now, just wait, because they are going to get a whole lot worse.
Typically, Americans spend approximately 10 percent of their disposable personal incomes on food. The following comes directly from the USDA website…
In 2019, Americans spent an average of 9.5 percent of their disposable personal incomes on food—divided between food at home (4.9 percent) and food away from home (4.6 percent). Between 1960 and 1998, the average share of disposable personal income spent on total food by Americans, on average, fell from 17.0 to 10.1 percent, driven by a declining share of income spent on food at home.
Needless to say, the poorest Americans spend more of their incomes on food than the richest Americans.
According to the USDA, the poorest households spent an average of 36 percent of their disposable personal incomes on food in 2019…
As their incomes rise, households spend more money on food, but it represents a smaller overall budget share. In 2019, households in the lowest income quintile spent an average of $4,400 on food (representing 36.0 percent of income), while households in the highest income quintile spent an average of $13,987 on food (representing 8.0 percent of income).
Needless to say, the final numbers for 2020 will be quite a bit higher, and many believe that eventually the percentage of disposable personal income that the average U.S. household spends on food will reach 40 percent.
That would mean that many poor households would end up spending well over 50 percent of their personal disposable incomes just on food.
At one time that would have been unimaginable, but now everything is changing. As I noted above, the price of corn his increased 142 percent since this time last year…
Corn prices have jumped roughly 142% over the past year to $7.56 per bushel, the highest price seen in eight years for the crop.
A drought in Brazil and increased demand in China have put pressure on global suppliers.
In other areas we are seeing more moderate inflation, but overall we just witnessed the largest increase in food inflation “in almost nine years”…
The average prices in March of 2021 for pork chops and chicken breasts are both up more than 10% compared to March of 2020. Eggs and cheddar cheese are both up 6%.
Looking at all consumer goods as a whole, the latest inflation data in the Consumer Price Index from the U.S. Bureau of Labor Statistics shows the largest month-to-month increase in almost nine years.
Meanwhile, the price of lumber just continues to shoot even higher.
In New Jersey, one man says that the total cost of lumber used in building his new home will reach $70,000…
Tom McCarthy can’t finish building a home in Bergen County, New Jersey because of the lumber shortage.
“There are pieces of wood that we can’t find,” said McCarthy, a real estate broker with the Chen Agency who also builds homes with his father on the side.
McCarthy estimates the cost of lumber for the home will hit $70,000, nearly double the cost of building the exact same home in a nearby town just eight months ago.
Isn’t that nuts?
Instead of building a new home, you could try buying an existing one instead, but real estate prices in many areas have gotten completely insane.
In northern California, one house recently sold for more than a million dollars over listing price…
When a house in Berkeley sold for more than $1 million over its list price in late March 2021, it was covered in media outlets across the Bay Area, including this one.
While the Berkeley sale was particularly sensational — it sold for double its list price and received 29 offers — these individual stories are becoming more common in today’s real estate market, according to recent data and anecdotes from real estate professionals.
I never imagined that I would see such a thing happen.
But one real estate agent says that such wild bidding wars are becoming increasingly common…
And that’s especially true in the East Bay. “People are not surprised when a home goes $1 million over,” said Josh Dickinson, the founder of real estate agency Zip Code East Bay. “When my clients see a house for $1.9 million they’re almost conditioned to think it’ll go over $3 million in Piedmont or North Berkeley.”
This is what the beginning stages of hyperinflation look like, but Federal Reserve officials insist that we have nothing to be concerned about.
In fact, Eric Rosengren just told the press that the crazy inflation we are seeing now “is likely to prove temporary”…
Boston Federal Reserve President Eric Rosengren in an interview with MarketWatch on Wednesday dismissed talk of scaling back asset purchases as premature, and said temporary factors pushing up inflation this spring won’t last.
“My view is that this acceleration in the rate of price increases is likely to prove temporary,” Rosengren said Wednesday.
Do you believe him?
As Simon Black has pointed out, the federal government is just going to continue to borrow and spend trillions upon trillions of dollars…
This is the big one. The US federal government is hoping to spend a whopping $11 TRILLION this year, between the regular budget, COVID stimulus already passed, and all the new legislation they’re proposing.
And it’s only May.
Obviously Uncle Sam doesn’t have the money. So they have to borrow it.
Almost everybody loved it when the federal government started sending out big, fat stimulus checks.
But you aren’t going to love it when a cart of food costs you $400 at the grocery store.
Whenever the government hands out “free money”, someone has got to pay for it, and one way we are paying for it is through higher prices.
If you do not believe that this is a major national crisis yet, you will soon, because it won’t be too long before most of the country is loudly complaining about how nightmarish inflation has become.
***Michael’s new book entitled “Lost Prophecies Of The Future Of America” is now available in paperback and for the Kindle on Amazon.***
About the Author: My name is Michael Snyder and my brand new book entitled “Lost Prophecies Of The Future Of America” is now available on Amazon.com. In addition to my new book, I have written four others that are available on Amazon.com including The Beginning Of The End, Get Prepared Now, and Living A Life That Really Matters. (#CommissionsEarned) By purchasing the books you help to support the work that my wife and I are doing, and by giving it to others you help to multiply the impact that we are having on people all over the globe. I have published thousands of articles on The Economic Collapse Blog, End Of The American Dream, and The Most Important News, and the articles that I publish on those sites are republished on dozens of other prominent websites all over the globe. I always freely and happily allow others to republish my articles on their own websites, but I also ask that they include this “About the Author” section with each article. The material contained in this article is for general information purposes only, and readers should consult licensed professionals before making any legal, business, financial, or health decisions. I encourage you to follow me on social media on Facebook, Twitter, and Parler, and anyway that you can share these articles with others is a great help. During these very challenging times, people will need hope more than ever before, and it is our goal to share the gospel of Jesus Christ with as many people as we possibly can.
What Will You Do When Inflation Forces U.S. Households To Spend 40 Percent Of Their Incomes On Food?
We become a poverty stricken third world nation with no middle/working class, as planned by our government.
I’m not on FB anymore for obvious reasons…but I do keep up with your articles on ZH and SHTFplan and on your sites. Amazing times we’re living in, eh?! Have lots of news from down here in AR…things seem fairly calm for the time being. That pipeline hack was about twice as bad as was reported in the media. Enough for the FBI to become involved in it. Lots of things happening over in Israel right now, and the Euphrates being drained is straight out of the book of Daniel. What worries me is this covid “vaccine”….and I put that in quotes for a reason. I do not believe it is a “vaccine”; it is a bioweapon. It changes your genetic makeup and allows you to be susceptible to programming from outside sources. If a person has the vaccine, they become “transhuman.”
We keep our children….all 5 of them….at home, full time. When we need to go for groceries or necessities, we run a UV light source over everything before our children get near it. We have chickens for eggs, goats in case of famine, and we are packing away as much dry goods and non-perishable food items as we can. Our garden is going well this year, but we expect to put up a greenhouse within the next 12 months. Being self reliant is key to surviving this.
I can not fathom why people are so willing to get vaccinated. It makes me sad, for the future generations, to know that the people who lead them and teach them now are nothing more than billion year old carbon….stardust.
All of our children are homeschooled. More than that, we teach our kids about Christ and about what is to come. While we know that we are to work hard and keep on keeping on, throughout all of this, we recognize that the Books of Revelations….Ezekiel Chapter 38….Isiaiah 17…Revelation 16……Mark 13: 33…..are all happening around us.
We pray for the suffering that is going on in the world, particularly for the children…the innocent…the disabled and the weary. Looking toward what is coming….it is awesome…uncomprehensible….and it gives me a sense of peace.
Easy. You won’t spend anywhere near that amount with a garden, even a potted garden, go fishing, eat the many eatable weeds, eat eggs, they are cheap for the protein, and drink bagged tea, not soda, and quit going out to eat and getting that Starbucks coffee, brew your own at home and buy it on Ebay for half the price. Nothing wrong with P&J sandwiches. I may be poor, but rich in food resources.
I’m no authority, but one doesn’t have to be an expert to know if you keep dumping trillions of dollars (backed by absolutely nothing) into the economy without an accompanying increase in goods and services and real growth there will be inflation. Gov’t and Fed. policies create inflation because it is in their interests to do so, and only they can stop (but won’t).
The truth is, only the ongoing dumping of trillions of dollars is staving off a depression, THIS IS A FACT. But even continuous dumping will have to be curtailed sooner or later. Then a choice will be presented, ruinous inflation or a depression. There is a technical difference in definition, but the effect on the American people is the same.
Just as there are inviolable physical laws there are inviolable economic and financial laws. I’m not talking about legal code, it’s how systems must function and interact. The economy, the market, financial systems, etc. have been so manipulated, is so out of balance, and milked dry for the benefit of a few so thoroughly, it can no longer function normally. It all must and will manifest breakdown and major non-functioning. High inflation is but a signal all this has occurred and must be corrected. Stand by, you are going to see some really interesting times.
Hmm, maybe I’ll be able to loose some weight that way, slim down some more. Back to my good looking skinny look of 50 plus yrs ago ( chuckle, snicker, yeah right ( day dreaming old fart )).
Why wait. The vast majority of adults could eat just one meal a day and be fine. I eat one meal a day and lost 30 lbs and have kept if off for 1.5 years. I look great at age 58 but could lose another 30 lb. The only way to do that is with extended fasting 2-3 days at a time drinking only water. I swear I could survive on air and water at my age and still not lose weight. The amount of food a person needs to live a healthy life is much, much less than most people think in America realize.
“most of the country is loudly complaining about how nightmarish inflation has become.”
Most of the country does not belong in any formal career role, consuming useful resources.
I hear woodchuck tastes a lot like chicken!
Squirrel…chicken of the tree
We are looking into some land so my Wife can have a large Garden she always wanted and have Chickens for eggs and meat. I hunt and fish and were looking into raising Bees also . My Wife also knows how to can what we would grow so were pretty well set as far as food goes.