A Possible Explanation

Just as many others living in the real world, I have often wondered how Ben Bernanke and his colleagues can fail to detect price inflation in the present economy. Then this story came along as a possible explanation. I can’t speak to the veracity of the tale, but it would explain a lot. It probably makes as much sense as most of the other hypotheses. Anyway here it is:

This guy wanted to know why Ben sees no threat of inflation in this country. So one Saturday morning he hung out outside of Ben’s house and followed him around on his day off, hoping to be able to ask him about inflation. Ben’s first stop was at the local full service station where they filled his car with ten gallons of 28.9 cent regular followed by a stop at the drugstore next door for a refreshing 25 cent chocolate malt. After that Ben was off to the grocery store with his wife’s shopping list. He couldn’t make out one of the items, and he didn’t have his cell phone. Luckily the store had a pay phone. So he fished a nickel out of his pocket and called his wife and found out that the illegible item was a loaf of bread. He grabbed a cart and started down the aisles filling his cart and whistling a happy tune. Being a trained economist and remembering that he had only a little under seven bucks left from the ten spot he had left home with, he kept track of the prices as he went along.

“Let’s see,” he muttered to himself. “Loaf of bread 15 cents. A dozen eggs 35 cents. Two T-bone steaks a buck twenty. A pound of hamburger 25 cents. Five pound of potatoes 15 cents. A Hershey bar for me 5 cents. A six pack of beer 59 cents. A can of Campbell’s soup 10 cents. A pound of saltine crackers also 10 cents. A cut up chicken 45 cents. A gallon of whole milk 55 cents. A three liter diet Coke 29 cents. Two cans of pork and beans 15 cents. A box of Velveeta 65 cents.

“That does it,” he said smiling. “And I’ll have just enough left to pick up the dry cleaning next door.”

And that is just what he did. The guy following old Ben never got a chance to speak to him, but he was happy anyway. Not only had the question been answered, but the guy had found the right neighborhood to do his shopping.