Inflation rates are up in double-digit territory in some parts of the world, inciting riots. But here in the U.S. we see benign rates of 2.7 percent. Don't you feel safe, secure -- even smug?

Well, don't, because that "core" number, which removes food and energy prices from the equation, is a fairy tale.

Once upon a time, weather- and OPEC-induced supply shocks caused gyrations in food and energy prices, so a core inflation number was introduced to remove the wild price swings from the inflation equation. Today, even though global trading lessens the intensity of these supply shocks, we're stuck with a number that grossly underestimates the true rate of inflation in this country.

Inflation sensation

1. Not benign after all 2. The 'quiet' risk 3. COLA not right either 4. Guarantees with a price

Meanwhile, U.S. consumers are getting slapped by inflation reality every time they check out at the grocery store or pay at the gas pump. I don't know about you, but my standard refrain in both venues over the past several months has been, "Holy macroeconomics!" (That's the sanitized version. It's actually more like, "Holy crap!")

Not benign at all
Despite the pain of its effects in recent months, inflation generally creeps up unnoticed until you walk down memory lane. Get a load of how prices have escalated over the past several decades.

Movements of goods, wages, DJIA

The numbers fluctuate, of course. Since these numbers were published a few months ago, gas prices climbed, the Dow dropped and home values tumbled to $206,200. And if you prefer a specialty bread at the bakery rather than a standard loaf at the grocer, you'll pay double the price listed above for it.