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PracticalDad Price Index – December 2014:  Egging on Inflation

The December 2014 data for the PracticalDad Price Index was collected and tabulated and while the Total Index of the 47 item marketbasket was static from November’s 111.15 to 111.18 (November 2010 = 100), the 37 item Food-Only Sub-Index rose to a new high of 115.13 (November 2010 = 100).  This surpasses the previous Sub-Index high of 114.73 reached in September 2014.

Of the 47 items in the marketbasket – 37 foodstuff and 10 non-foodstuff – there were actually more items that decreased in price than increased, 10 decreases to 7 increases with the remainder unchanged.  But these were smaller decreases that were offset by a major increase of approximately 37% in the retail price of a dozen large eggs; the average November 1 price of a dozen large eggs was $1.89 to December’s $2.62 per dozen.  Why the rise?  First, the data from the past four years of the PracticalDad Index demonstrates a Fall/Winter spike in egg prices that subsequently drops back and it’s likely that this is another example of those same spikes.  Second however, the wholesale price of eggs across the country rose signficantly in the past several months because of increased foreign demand for American eggs.  Just as there’s been increased foreign demand for American dairy products because the New Zealand dairy suppliers are also affected by a drought that impacts their own production, Mexico has seen a major decrease in production because of the forced destruction of poultry flocks affected by an outbreak of Avian Influenza.  This poultry virus is highly contagious and the only real measure to combat it is to destroy any flock – healthy birds included – in which it’s been detected.  It’s the possibility that this can mutate and be passed on to humans that keeps epidemiologists awake at night.  Any significant outbreak will accordingly affect supply and Mexico has consequently met its egg demand by importing more from the US.

Will eggs again drop in price in future months?  I suspect so, but not to previous levels as before.

There is one other curious observation from the past several months of price surveillance.  In two of the three supermarkets – each of which is wholly unrelated to the others – I’ve been seeing empty sections on the shelves.  These spaces aren’t just because the product hasn’t yet been restocked, but on several occasions there have been small signs stating that the items are discontinued.  When I return a different time, that shelf space is filled with another item.  I haven’t collected any data but am working purely on observation.  It does however, make me wonder whether all of the dislocation that we’re seeing in this slow motion real-economy train wreck is starting to have an effect on the supply chain and if so, to what extent it will spread.

And now for the past six months of results. 

PracticalDad Price Index – December 2014
Month Total Index Food-Only Index Spread
7/14 110.20 113.22 3.02
8/14 110.14 113.71 3.57
9/14 111.07 114.73 3.66
10/14 111.11 114.45 3.34
11/14 111.15 113.87 2.72
12/14 111.18 115.13 3.95
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Cancelling Christmas?  Yeah, I’m Down With That…

Now that the first third of the major painting project is finished – and that’s fodder for another article on practical economics and kids – it’s time to get back to writing and what should appear but mild uproar over a parental decision to “cancel” Christmas.  Is this going too far?

Let’s set the stage here.  The parents live in the western US and have three sons ranging from five to eleven years of age.  Upset at the ongoing disrespect and ingratitude for a period of months, the two reached a point at which they pulled the plug on Christmas, at least the material Santa-aspect of it.  There will still be a tree and the kids will be allowed to receive their gifts from their grandparents and other family members, but the usual Santa-aspect fol-de-rol will be gone this year.  In its stead will be activities that foster what should be a greater appreciation for the season – adopting less-fortunate families, adopting elderly neighbors as “grandparents” and inviting them to meals and sending care packages to a weather-devastated village.  It isn’t simply refusing to even acknowledge the season, but a purposeful refocusing on the meaning of the season to teach a lesson in gratitude and respect for others.

But is it going too far?  From my standpoint as a parent of three kids, it’s frankly not too far at all and given the ages of the boys, probably not a moment too soon.  If you’re going to discipline your children, you need to start at a very early age so that you aren’t forced to fight battles with recalcitrant and hormonally addled teens, some of whom might actually be bigger than you are.

First, understand that raising kids to be appreciative, respectful and grateful is difficult in present American society.  The consumerism runs amok and with the plethora of kid-centric programming – Nick Jr., Nick, Cartoon Network, etc. – there’s an ongoing push to have whatever is coming down the pike.  This can be coupled with programming that also shows frankly disrespectful behavior to parents and other elders and yes, it is corrosive.  At an evening meal this past Thanksgiving break, Eldest and Middle – now in college and high school respectively – rode Youngest for getting Cartoon Network’s Fairly Oddparents banned from the household eight years ago when he responded to me with a character’s phrase, blah blah blah.  Even if the family controls the household electronic media, the kids will likely be spending time in school with more than a few peers in which the programming and media isn’t controlled; the upshot is that the kids will still be exposed and influenced via their classmates.  We’re raising our kids to take their place in the world and the unfortunate reality is that the attitudes and behaviors of other kids will bleed over into our own households and will require ongoing monitoring and conversation.

Second, the mother states in a paragraph that there seems to be a fair number of parents who aren’t enforcing discipline upon their kids.  There are parents who will threaten consequences that on one hand seem thoroughly unenforceable, such as the several parents that I’ve overheard at airports threaten their misbehaving children with leaving them behind instead of taking them along to Florida.  Really?  You’re not going to take them along?  At some point, the smarter kid realizes that there’s no way this is going to happen and the parent loses stature in the kid’s eyes and the belief is born that what’s coming from the ‘rents mouths really is blah blah blah.  If discipline is going to be effective, it has to first be enforceable; you can’t in the spur of the moment make a threat that can actually be met. Kid, if you don’t pull yourself together and stop that behavior now, when we get to Florida, you’ll be sitting on the beach towel for the first half hour instead of going in the water.  The next part of the deal is to actually enforce the discipline, however unpleasant that might be in the moment.  In the case of traveling to Florida, it’s actually best if you already have a track record of enforcing the discipline so that the child complies in the public airport instead of melting down into a massive tantrum.  So if you promise
in the household to remove a bedroom door for three days should certain misbehavior continue, then you had better follow through when that moment occurs again.  When the child realizes that you are actually serious and willing to follow through, then good behavior will generally occur later without the need for public histrionics.

The third point is that our economy is changing before our eyes.  In the past several years, the typical family has seen falling income and declining assets, coupled with the need to take on greater responsibility for medical bills and health insurance than before.  This is the kiss of death for the consumption model with which we ourselves were raised, when benefits were routinely provided by employers and Grandpa had a pension that provided at least a semblance of some security in his old age.  Our own kids need to start seeing a change in the Christmas behaviors and practices so that they can themselves adapt and work within the economic constraints within which they are likely to find themselves.

So yeah, I’m good with the notion of cancelling Christmas if the parents think that that’s what is necessary to restore some order in the household. It’s not just a simple ban but is being reinforced with more positive behavior that models the better aspects of the season and yes, it is something that the boys will remember, especially when Mom and Dad are telling them something when they’re man-children instead of boys.  If my own wife and I haven’t had to cancel Christmas, it’s only because we’ve already removed bedroom doors and cleaned out bedrooms of all toys for a week at a shot so that the kids understand that we’re serious when we say something.