I have read that much of the QE that we have had has resulted in asset inflation instead of monetary inflation. Does this mean if asset prices crashed (such as stocks) that we would suddenly see a surplus of dollars and thus hyper inflation?
Just from regularly going grocery shopping as a cheap bastard, I believe that's false. I get sticker shock just from looking at a bag of potatoes anymore. Ramen, soda, water (both water exclusively and bottled water), cheese, celery, everything else - everything's ~2-4x more than what I remember as a kid.... and I'm 22. Why... I remember back in my day when you could buy eight microwave burritos for a buck, gas was under $1/gal (I actually only have one memory of this, and the station was having some kind of celebration), Ramen was 10/$1, and in-season corn was 20/$1. Now it's 2/$1, $3.50/gal, 4/$1, 8/$1.
You can take a look @ gov't BLS food data... pretty much everything shot up ~20-75% from 2010 to 2012. Meanwhile, BLS CPI-U (for everything -- I don't think they post food-only numbers) is right around 2.5% annually since around the time I was born. 1.025^22=172.1572%, which would accurate enough for 2010-2012, but certainly not be accurate for 1991-2013. By my guesstimates based on memory of old prices, the annual average increase for food alone is >5%, probably closer to 8-9% since I'm unsure "when" I started keeping mental notes on prices, which is much more in-line with SGS data, which would make the data much closer to "real" inflation from QE and "normal" inflation.
Anyway -- all that to suggest I don't think inflation wasn't factored into consumer prices, it's just I think the official numbers are either misleading or flat-out wrong... but my memory's notoriously bad.
