If you have been reading Smart Investing Daily, you know that food trends, demand and subsequent food inflation have been on our radar (and trade ideas) for some time, including my Thanksgiving notes as well as my concerns here in early October.

Consumer Price Index and Inflation

When I first started in the business and was learning how the “stock market” interprets data, I was told that when market players are evaluating inflationary pressures, they pay close attention to something called the “Core CPI”; I’ll get to that in a moment, but let’s talk consumer price index first.

Consumer price index (CPI), which measures monthly prices for the goods and services we consume. It measures everything from the price of canned fish and bread to laundry detergent, fuel, electricity and even the water and sewer costs of your home; even average rent rates are measured.

The goal here is to record and monitor the costs of living in America. If we pay 5% more for the same “stuff” (on average) this year than we did last year, one could make the assumption (generally) that prices have inflated about 5%, or that our dollar may be worth 5% less (on a very basic level).

Over the past year, the consumer price index increased 1.5% and the year prior the index saw a Read more