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National and Global, United States

Monday, February 28, 2011

A Very Bad Year for Your Wallet: This Year!



Bad weather and global instability are spurring price hikes for everything from cotton to oil.

The worrisome economic news just keeps on coming. Inflation is creeping higher, as prices rise for everything from corn to coffee. The government's Consumer Price Index — a standard measure of how much household goods and services cost — rose 0.4 percent in each of the last two months, the first back-to-back increases that big since the summer of 2008. Now, forecasters say global weather problems and instability in the Middle East could make crude oil, cotton, and other important commodities even more expensive. Here are four ways you may be affected:

Clothing
Clothing prices, after falling for a decade, are expected to rise about 10 percent this spring, according to the Associated Press. The price of cotton has already more than doubled over the past year. Your cotton underwear will definitely get tighter!

Fuel
Crude oil prices recently hit a two-year high, as unrest in the Middle East, particularly Libya, fed investor worry about oil production. Gas prices have risen 20 percent over the last year, and could go even higher. Even a Preus won't help the ache on this one. Try a walking-stick.

Food
The cost of staples such as wheat, corn, and sugar has jumped dramatically in recent months, largely because of droughts, floods, and rising demand. Now's the time to plant that Kale and Collards!

Household essentials
Rising fuel and ingredient costs will also translate to higher prices for items such as toothpaste, soap, and batteries. Shower once each week, don't brush your teeth everyday, and don't use anything with a battery.

And that's all the good news fit to print!

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