A Valid and Reliable Measure of the Economy

Often the most valid and reliable measure of the economy is in one’s own wallet. An example is a loaf of bread.

There is a national grocery chain in the neighbourhood. The grocery store has local fame for making wonderful whole wheat bread. The loaves are made in the store and made in limited quantities. The supply usually is gone in a few hours. The bread is not sliced and, if one hurries, the bread arrives home still warm to the touch. It is really a comfort food.

In January of this year, a loaf of this bread was eight nine cents ($.89). Today, in mid-April, it was selling for a dollar thirty nine ($1.39). A fifty cent ($.50) increase is a fifty six per cent (56%) spike in the price. This is not really a luxury item. The other bread on the shelves costs more.

It is doubtful that many of the consumers had a fifty six per cent increase in salary from January to April, 2008. Food bills are soaring. Once prices escalate, it would be remarkable that the prices would drop back down. And in the news, the politicians use phrases like “a rough patch in the economy”. Perhaps these political leaders need to go buy some groceries, as an economic indicator. Citizens on fixed incomes are in trouble.

Catherine Forsythe
Director of Operations
FlyingHamster: http://flyinghamster.com/

Tags: economy, indicators, bread, price, politicians