A new problem for consumers: rising prices. From the farm to the grocery store to the gas station - think of it as a cost of living adjustment - the wrong way.Take a look at cotton prices - they've more than doubled in the past year to all-time highs. And that means the cost of clothing is sure to go up, after reaching record lows during the recession.U.S. apparel companies have warned they will start passing the price of cotton onto consumers in what some are predicting could be a 10% price hike. Corn prices are through the roof, doubling in just the past six months.You've seen some of it at the cash register at your grocery store-- adding eggs to your cart cost you more than 6% more in 2010 versus 2009. Paula Dean will be distraught to hear this—butter prices are up nearly 22%.Remember when hamburgers were a cheaper meat option at the store? Now prices are up 6.25%. But that’s still a smaller increase than the other white meat like pork, whose prices up more than 11%.And have you noticed your morning coffee is costing you more? Java prices up 2.5%.I don't mean to be the food scrooge here, but this problem is just going to get worse. That's because, for a while now, manufacturers have avoided raising prices because cash strapped consumers couldn't pay more. Better to take a hit to profits than to have no profits at all, was their thinking.But they can't do that forever—change is coming.According to The Wall Street Journal, stockpiles of basic food commodities are thin - virtually guaranteeing higher prices.In commodities markets, traders have already pushed corn futures up 92% this year. Soybeans are up 44% and cotton futures are up 162 %. That tells you the people with their eyes on the market see nothing but inflation.Rising prices tend to beget more rising prices - and interest rates could well head the same direction. All of which would make it more difficult for debtors to pay down their debt, because their costs only go up. Higher inflation could also become yet another hurdle to the housing market.In short, get ready—we could be headed into a period of big-time inflation and interest rates. If growth doesn't improve, we could get stagflation-- a nightmare scenario that helped push Jimmy Carter out of office.
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