Sorry, Gas and Food Inflation Has Already Eaten Your Rebate Check

Wal-Mart (WMT) said its strong comparable-store sales yesterday benefited from the government’s stimulus checks. Wal-Mart’s gain, however isn’t really shared by consumers, who lost more than the value of the rebate checks to inflation:

Let’s look at an average family of four as described by the US Department of Agriculture (couple 30-50 with young kids). Their prescribed “liberal” food bill in June of 2007 was $897 per month. It now stands at $975 (compounding the latest figures for 4/08). That’s an annual increase of $936 per family.

The average adult uses 500 gallons of gasoline per year. The cost of unleaded gas in June 2007 stood at $3.13 per gallon. One year later it has risen to $3.93 per gallon. That’s an annual increase of $400 per person or $800 per couple.

If both parents work, the family will receive ($600 + $600 + $300 + $300) = $1,800

While the cost of their non–CPI living has consumed most of it ($936 + $800) = $1,736

How poetic – the answer is: $64!


See Also:

Wal-Mart (WMT) Feasts on Tax Rebate Checks: Same-Store Sales Beat Consensus (WMT)

Tax Rebate Checks Won’t Save Retailers–And They’re Already In the Stocks (XRT, WMT)

Business Insider Emails & Alerts

Site highlights each day to your inbox.

Follow Business Insider Australia on Facebook, Twitter, LinkedIn, and Instagram.

Tagged In