Thu January 16, 2014
Expensive Bacon, Cheap TVs, And Other Price Trends From 2013
Inflation is very low: Prices rose 1.5 percent last year, according to the consumer price index report released this morning.
But when you dig into the numbers, you see some notable price swings. Here are a few that caught our eye for different reasons.
The price of bacon rose 9.6 percent.
Overall, food prices rose by just 1.1 percent last year. But drill down, and you see a lot of variation. The price of bacon, for example, rose by 9.6 percent last year. As it turns out, bacon prices have been rising for several years because people are really into bacon these days. As a result, Bloomberg News points out, "pork bellies, cured and sliced to make bacon, account for a record share of the value of a hog."
Gas prices fell by 1 percent.
The price of gas fell a little last year. This was partly due to the fact that the U.S. is producing more oil — a trend that's likely to continue this year, which could drive down gas prices even more.
The price of TVs fell by 13.9 percent.
The price of lots of consumer electronics fell last year, but the price of TVs fell especially sharply. Flat screen TVs are now commodities, subject to all the advances in technology and supply chain management that drive down prices year after year.
The price of medical care rose 2.5 percent.
The price of medical care rose last year — but it rose much more slowly than it had in previous years. If this slowdown continues, it will be a big deal for the U.S. economy. Rapidly rising medical prices are part of the reason health care has eaten up a bigger and bigger share of the economy. Rising health care spending was also projected to be the biggest driver of the deficit in the coming years. The big question now: Is the slower rise of health-care prices just part of the aftermath of the recession, or is it because of some long-lasting shift?
The price of college textbooks rose by 5.7 percent.
Because of course.