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How’s Inflation Really Doing? Ask a Cheeseburger

Most traditional indicators show inflation in the U.S. to be well under control, but bacon cheeseburger eaters know better. Compared with last year the cost of eating that most American of staples is up 5.8 percent, according to the Bacon Cheeseburger Index—an only partially tongue-in-cheek measure that brokerage firm ConvergEx uses to gauge consumer price pressures.

The surging index likely won't faze policy makers at the Federal Reserve who focus on indicators like the Personal Consumption Expenditures reading or the Consumer Price Index. Both show little inflation, with Monday's PCE reading a tame 1.5 percent on an annualized basis. Those types of readings, though, often fail to reflect conditions on the ground. The latest Bureau of Labor Statistics data show drought conditions pushing some food prices to disturbingly lofty heights. Ground beef, for instance, is up 16.2 percent from 2013 levels. Bacon prices have jumped 8 percent, and American cheese has surged 8.4 percent. Bread is the only thing that's fallen in our chosen delicacy, declining a modest 0.9 percent.

Consumer Prices Rise Sharply 0:46

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-- Jeff Cox, CNBC