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The problem with the CPI food index is how it is weighted. It is not a pure reflection of cost. The indexed items change to reflect what the majority of consumers are purchasing within a given category. So, for example, if more people start buying hamburger and less buying steak, it indexes the price of hamburger. The price of hamburger may well have increased substantially. However, the prior calculation would have been based on steak, not hamburger. Thus the index remains little changed whereas the actual price the consumer sees has changed substantially. I do my own grocery shopping and have seen a substantial increase in cost. Even staples like ramen noodles have gone up by around 40% in the last year and milk and dairy products have also shot up substantially.
As for gold, I think it is over bought at this time. Yes, the dollar is being heavily devalued but I just don't see long term support for the price of gold remaining where it is unless we see total currency collapse. If I was going to speculate on precious metals right now I would buy silver. It is trading at a percentage of the price of gold that is a historical low at the moment and has the best potential for growth. Plus, it has high industrial demand that outstrips production by 20% per year so it is unlikely to crash.
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No green technology will ever make a substantive environmental impact until it is economically viable for most people to use it. This must be from a reduction in net cost of the new technology, not an increase in the cost of the old technology through taxation
(Note: the car sees 100% city driving and is EPA rated at 37 mpg city)
Last edited by Jim-Bob; 01-01-2011 at 02:49 PM..
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