WP: Inflation Eroding Buying Power: Prices Increase as Wages Decline

Inflation Eroding Buying Power
Prices Increased Last Month as Wages Declined
By Nell Henderson
Washington Post Staff Writer
Thursday, June 15, 2006; Page D01

Consumer prices rose briskly again in May, led by rising costs for gasoline and housing, the Labor Department reported yesterday, boosting the likelihood that the Federal Reserve will keep raising rates to restrain inflation.

With many motorists paying more than $3 a gallon for gasoline, landlords hiking rents and businesses passing on more of their rising energy and materials costs to shoppers, the department's consumer price index rose 0.4 percent last month after a 0.6 percent increase the month before.

Inflation is eroding consumers' purchasing power, as prices rise faster than most workers' wages, the department said in another report. After adjusting for inflation, average weekly earnings declined 0.7 percent last month and bought 0.2 percent less than in May last year.

"Inflation is definitely on the rise . . . and it will be troubling for many consumers, particularly those at the lower end of the income scale," said Richard Yamarone, director of research for Argus Research Corp., a financial analysis firm. Even so, he added, "inflation is not at a level that is going to cripple the economy, and it appears the Fed is on top of things and will indeed combat these mounting pressures."...

http://www.washingtonpost.com/wp-dyn/content/article/2006/06/14/AR2006061400516.html

speed....and gathering snow as it rolls...an avalanch is coming and sadly the many people don't see it coming..

there are many indicators that despite the rosey picture the * cabal paints....it's not good...people are having problems filling their tanks to get to their jobs....

When for so many of their dreams of prosperity are diminishing right before their eyes because of his economic policies.

A good indicator of a failing economy is the increase in the crime rates. Locally, almost all of our gas stations have switched to pay before you pump because of all the fill-ups and drive offs, without paying.

remember the '70s?

Since most of them are so overpaid, It will sink us a long time before it touches them.

On the other hand, just thinking of a hyperinflation spiral with Howie Kurtz hauling a wheelbarrow full of dollars to a store to get a pint of milk...}(

When yellow squash was 1.99 a pound, and they were saying that we had no inflation, I knew they were lieing.