The Inflation Rate Is Only 1.2%? Say What?

"The inflation rate right now is 1.2% for all goods and services."

-Federal Reserve Chairman, Ben Bernacke, in testimony before the U.S. House Financial Services Committee, March 2, 2011.

According to a recent article on CNNMoney.com, the Fed is currently projecting inflation of less than +2% for each of the next 3 years. Really?

The bar chart above shows the change in the price of several commodities from 2000 to 2010. The majority, if not all of which would be considered by many American's to be "staple" items.

For the group as a whole, the average price increase was more than +100% for the 10-year period, which was an annual increase of about +6.5% per year, more than twice the annual inflation increase the U.S. government has been reporting for the same period!

Has the government been under reporting the inflation figures for the past 10 years? Do you believe that inflation is really running under +2%? The government couldn't be misleading us, could they?