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drmike

Nov 8, 2008, 8:08 AM

Post #1 of 3 (714 views)

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Cost of Food Rising

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Okay, I am not an economist, so perhaps I simply don't understand real world economics but I have a question.

Did not the Mexican Government put a price freeze on 150 "staples" food products several months back? I seem to remember a list of foods whose prices had been frozen to prevent more problems for the Mexican citizen during the global meltdown.

If so, why are the prices in the grocery stores continuing to rise week by week?

I remember back in the 1970's Prez. Nixon put wage and price controls on the US citizens and prices did not rise, for a while. Here in Mexico the prices continue a spiral upward, even after the govt. announced a price freeze on food staples.

Is it because the peso is weakening against the dollar? Or are the retailers (and wholesalers) ignoring the price freeze?
Dr. Mike

http://www.smarthealthchoices.blogspot.com

There are hundreds of paths up the mountain,
all leading in the same direction,
so it doesn't matter which path you take.
The only one wasting time is the one
who runs around and around the mountain,
telling everyone that his or her path is wrong.

Hindu teaching

esperanza / Moderator

Nov 8, 2008, 8:42 AM

Post #2 of 3 (704 views)

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Re: [drmike] Cost of Food Rising

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About four months ago, the Mexican government announced a price freeze on a number of items from the Canasta Básica (basic market basket), but the freeze never took effect.

This past week, Agustín Carstens, the head of Hacienda (analogous to the IRS in the USA) announced that it was futile to try to freeze prices, as a price freeze only ended up with a scarcity of food items on grocer's shelves.

http://www.mexicocooks.typepad.com

drmike

Nov 8, 2008, 12:02 PM

Post #3 of 3 (668 views)

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Re: [esperanza] Cost of Food Rising

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Thanks, Esperanza, for the clarification. That explains the constant price rises.
Dr. Mike

http://www.smarthealthchoices.blogspot.com

There are hundreds of paths up the mountain,
all leading in the same direction,
so it doesn't matter which path you take.
The only one wasting time is the one
who runs around and around the mountain,
telling everyone that his or her path is wrong.

Hindu teaching