Why Flyover America Is Sinking: The Four Horseman Of Inflation——-Food, Rent, Medical, Energy

Monday, May 23, 2016
By Paul Martin

DavidStockmansContraCorner.com
May 23, 2016

It may come as no surprise that in the aftermath of an epic single-family housing boom and subsequent bust, millions of more people have been renting — without much new multifamily housing supply until recently.

This situation has let to strong gains for apartment REITs and an astonishing ability for property owners to raise rents.

Now a research paper by Rob Arnott and Lillian Wu of Research Affiliates in Newport Beach, Calif. asks why the CPI doesn’t reflect the inflation that is apparent in places where people spend their money.

Arnott and Wu argue that the four biggest expenditures for most people — rent, food, energy, and health care — have been rising. Since 1995, rents have been rising at 2.7% clip, energy at a 3.9%, food at 2.6%, and health care at 3.6%. Notably, these four expenses account for 60% of the aggregate of people’s budgets, 80% of middle-class budgets, and 90% of the budgets of the working poor.

The Rest…HERE

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