Era of cheap & plenty ending?

Investment Analysis Clubs Macro Economic Trends and Risks
1

https://www.nytimes.com/2022/05/03/business/economy/pandemic…

**The Era of Cheap and Plenty May Be Ending**

**Supplies of goods are coming up short in the pandemic, and prices have jumped. Some economists warn that the changes could linger.**
**By Jeanna Smialek and Ana Swanson, The New York Times, May 3, 2022**

**...**
**Economists are debating whether recent supply chain turmoil and geopolitical conflicts will result in a reversal or reconfiguration of global production, in which factories that were sent offshore move back to the United States and other countries that pose less of a political risk.**

**If that happens, a decades-long decline in the prices of many goods could come to an end or even begin to go in the other direction, potentially boosting overall inflation. ...**

**Shipping costs have soared by a factor of 10 in just two years, erasing the cost savings of making some products overseas....reduce carbon emissions by bringing production closer to customers...population aging, leading to higher labor costs...securing supply chains by "friendshoring"...** [end quote]

There’s a lot of disagreement about all these factors. Also, manufacturing is a smaller part of the economy than services.

Wendy

6 Likes
2

The Era of Cheap and Plenty May Be Ending

Cover of an issue of Newsweek, from the fall of 73. Uncle Sam looking into an empty cornucopia, with the headline “running out of everything”.

https://www.flickr.com/photos/bob_roddis/5665427476

More of the media hysteria parade.

Steve

5 Likes
3

More likely is a change in what is “cheap and plenty” in the new world economy. What those will be? Good question.

4

Most of the items at Dollar Tree are now $1.25 each. That applies to even the items produced and packaged locally e.g. canned food or snacks. For some stores, even the shelf signs say $1.25, to distinguish them from shelves with merchandise cheaper than $1.25 (a fairly rare sight)

Rather than “ending”, I would say “ended”

1 Like
5

Wendy,

There is a lot of these news stories. They are an impetus for building American factories.

I would not call it propaganda. The articles are a necessary education for American citizens tuning in late or not believing things unless it is reiterated several times.

1 Like