ECONOGAL

It is time to look at a new market basket. The inflation check challenge focused primarily on food with a few other items thrown in. The United States government excludes food and energy costs from their price index because these items are so volatile. But food and other everyday items are key in the minds of consumers. If food costs go up, more of the household budget flows to this essential. Other items take a back seat.

However, tariff driven price increases will impact a variety of items. Food does come into play. And so, we will keep food goods in the market basket. But other goods come to mind.

One of the problems in tracking goods is that many items manufactured in the United States use parts from overseas. Thus, the goods will be impacted by a trade war. We will look at some goods made in the United States primarily with imported parts.

Finally, we will include non-edible direct imports. For example, I use a Samsung laptop for my work. Other items would be tougher to track due to multiple variables. Think of gemstones or furniture or even light fixtures. For a market basket to work you need comparisons that are exact.

When I first looked at inflation, supply chain shocks due to disruption from Covid was the culprit. The items were mostly food based with a few outliers. I revisited this market basket recently and the prices jumped quite a bit in the intervening years. I have included a table for those of you who participated in the Inflation Check Challenge.

I am keeping quite a few items from the old market basket while adding a few new ones.

Among the additions are eggs, whole milk, Samsung laptop, Aluminum Foil, Hamilton Beach 4-slice Toaster and a G.E. Microwave. It will be interesting to see what if any impact occurs. Between the New Market Basket and the Misery Index we will get a feel for which direction the economy is headed.