Came across this article today and had to just laugh, I have been noticing and talking about this for months and months and months yet it continues to go ignored. This article points out what is going on with food prices, I mean if you didn't notice food prices soaring you are a complete fool, and if you believe what Bubble ben bernanke is saying, that there is no need to worry about inflation, then your even a bigger fool!!!! Besides that all I keep hearing is that commodity prices are going to rise even further, who knows when the commodity surge breaks but when it does its going to be quite a collapse. No Inflation? That's Not What Food Prices Are Saying Published: Monday, 28 Feb 2011 | 1:18 PM ET Text Size By: Jeff Cox CNBC.com Staff Writer CNBC.com With all the talk about $4 a gallon gas and the crisis in the Middle East, the specter of surging food prices has gotten pushed to the background. Thatâs a mistake, considering that the struggle to put food on the table is what generated the riots in the first place. In the US we focus so much on gas because of the way higher transportation costs infect every sector of the economy, but rising grocery costs are a major threat as well. Of course, we live in the land of no inflation. Core cost of living is cruising along in the 1 to 2 percent range, according to government calculations, indicating that we have nothing to worry about when it comes to inflation concerns. One can only imagine that the economists who project these assertions donât have to eat. By any measure imaginable, food prices are climbing and climbing fast and itâs not only in developing countries where income canât keep up with the rise in the cost of goods. Here in the US, food is putting a big bite on household budgets. More than 12 percent of after-tax income is now being spent on fuel and food, with more than half that number on the latter. Commodity prices, as measured through the Standard & Poorâs GSCI, are up about 7 percent this year alone.. Still, the see-no-inflation hear-no-inflation speak-no-inflation deflation monkeys insist that these rising commodity prices will have no pass-through effects onto grocery store shelves. Of course, we all know theyâre wrong. Consumers have been getting hammered for the past year, even if it doesnât show up in the heavily massaged consumer price and producer price indexes. So rather than relying on these purely academic measures of the cost of living, letâs take a more direct route. The Bureau of Labor Statistics compiles the prices of various foodstuffs on a site that, frankly, isnât always the most helpful. Some of the data is out of date and simply unavailable in some cases. But I did a rundown on some basic food products to see where prices are heading, and as you might have guessed the news is not pretty, unless of course you consider wine one of the four basic food groups. I checked the prices of the following goods to see where we stood month over month (December to January) and year over year. Monthly figures are first, annualized are second. Read it and weep: * Ground beef up 6.8 percent month over month, and 11.1 pct year over year. * Butter, up 3.2 percent monthly and a stunning 27 percent over the past year. * Coffee, up 6.5 percent and 16 percent. * Potatoes, up 3.6 percent and 7.1 percent. * Lettuce actually fell 5 percent monthly after a spike higher in December, but is up 5 percent over the past year. * Bread up 1 percent and 3 percent. * Chicken up 0.8 percent. and 4.3 percent . * Egg prices have been fairly steady. * Milk, down slightly month over month, but up 2 percent year over year. That doesnât sound like the 1.6 percent inflation rate the government is feeding us, now does it? The only good news is in orange juice, which rose marginally on a monthly basis and was down 1.6 percent year over year. And the biggie was wine, which fell 27.6 percent in the one-month period after its usual spike higher for the holiday season, and is down 6.9 percent for the 12-month period. Indeed, Iâve been enjoying the $8.99 Smoking Loon at the liquor store on Route 519 in Belvidere, N.J. In vino veritas! Then thereâs gas. Prices at the pump have surged so far in February and are up 23 percent over the past year. Economists are debating how sustainable the rise in energy prices might beânothing cures high prices like high prices, they reasonâbut at least one has interjected the âSâ wordâstagflationâinto the debate. If youâve been reading the past week, youâll know Iâm a big old worrywart when it comes to stagflation. Thatâs what happens when unemployment stays high and while prices rise. Smart people with impressive pedigrees say weâre a good ways away from there now, but opinions are changing. âWith the 2008 (oil) level of US $147 not that far away, the market inevitably tries to compare the two episodes. Although a firm conclusion still evades the market, the 2008 peak was likely the result of a runaway global economy, on the verge of a bubble in hindsight, fueled by some speculation/hedging demand for inflation,â Bin Gao, rates strategist at Bank of America Merrill Lynch, wrote in a research note. âThis time it feels different and with stronger similarities to the 1970s in terms of the supply shock element. In an economy which continues to struggle for a solid recovery, the high oil price raises concerns of stagflation.â Those concerns appear muted for now, but should government economists start going to the grocery store, that could change rather quickly.