Image © pepsico.com

If you are a consumer that enjoys Mountain Dew, Pepsi, Lipton Tea, Aquafina Water, or the AMP line of energy drinks; Be prepared to pay 3 to 5% more for your products.

These price increases are directly linked to inflation.

In a memo sent to retailers dated June 29th, 2012, PepsiCo Foodservice’s Senior Vice President Timothy F. Trant stated the following:

Commodity inflation has been very high over the past several years and will continue in the coming year, so internal productivity must be supplemented with price actions in order to continue to deliver the high quality products and services you have come to expect from us.
With that in mind, we are announcing price adjustments that will increase the cost of our products +3-5 percent depending on the brand and package, PBC will honor existing pricing as published through 7/28/12, and these changes will take effect on 7/29/12.

Beginning on July 29th – the day of the Brickyard 400 NASCAR race in Indianapolis – the retail price of your PepsiCo products will be rising.

Which commodities are feeling the inflation?  Could it be corn?  Most of PepsiCo’s products do contain High Fructose Corn Syrup, after all.  Is it the plastics?  Is it the aluminum?

Mr. Trant had not returned our phone call for comment at the time of publishing.  The post will be updated accordingly should we receive comment from Mr. Trant, or another PepsiCo representative.

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The following chart shows a comparison of prices of certain commodities from January, 2009 when Obama took office to the prices of the same commodities in January, 2011.

            Sourcing is footnoted.

            Leftist should take a lot of tranquilizers before reading this chart.

Just take this last item: In the last two years we have accumulated national debt at a rate more than 27 times as fast as during the rest of our entire nation’s history.  Over 27 times as fast. Metaphorically speaking, if you are driving in the right lane doing 65 MPH and a car rockets past you in the left lane.   27 times faster, it would be doing 1,755 MPH!

Sources:
(1) U.S. Energy Information Administration; (2) Wall Street Journal; (3) Bureau of Labor Statistics; (4) Census Bureau; (5) USDA; (6) U.S. Dept. Of Labor;
(7) FHFA; (8) Standard & Poor’s/Case-Shiller; (9) RealtyTrac; (10) Heritage Foundation and WSJ; (11) The Conference Board; (12) FDIC;
(13) Federal Reserve; (14) U.S. Treasury 

September wheat dropped twenty two and a half cents per bushel to $6.57 and corn dropped 0.17 to $6.86 a bushel. Oats and soybeans also took significant drops as the entire set of major grain futures took a nosedive.

Beef and pork futures also slid lower, but why?

Petroleum products dear friend – that’s why. Across the board Oil, Natural Gas, gasoline, all of them dropped. Usually when commodities sink it’s due to a strengthening dollar. Not this time.

If all commodities futures were falling, a weakening greenback might be to blame, but gold is having no trouble reaching new highs. Closing at 1760+ on Monday, gold is showing all the strength of a temporary safe refuge for money that investors can’t put elsewhere.

Food, grain, oil and fuel are falling because the speculators have seen the same reports the rest of the universe has – the second recession is here. Upon expected dwindling demand, prices will fall.

Gold is NOT seeing anything close to a slowing demand curve. It is precisely where many are moving their money in anticipation of what will almost certainly come next – another round of money printing.

While food may drop short-term, Americans are in for more quantitative easing (a.k.a. federal reserve printing money) which will further devalue the dollar and require more greenbacks to purchase the very goods that are currently on a downward price trajectory.

This is a temporary descending blip. Food and energy will become more expensive as the dollar becomes diluted by further irresponsible printing and that’s what all those gold buyers already seem to know.