Many “experts” think that single mothers on food stamps are buying too many diapers and too much baby formula. They lived “too high on the hog” during the pandemic.
intercst
3 Likes
Prices are still high because they don’t go down unless you have deflation. You definitely don’t want to deal with deflation.
DB2
5 Likes
Apartment rents, gasoline prices and grocery prices have been going up and down as long as I’ve been alive. What’s different in the past 40 years or so is that lack of antitrust regulation.
When I was living in Houston in the 1980’s and 1990’s no grocer had more than 15% of the local market. You had Safeway, Albertsons, Kroger, and large Texas chains HEB and Randalls all fighting for market share.Houston had the lowest grocery prices in the nation – no doubt it caused the obesity epidemic.
Over time, all these players were allowed to merge with one another and the consumer paid for it in higher prices.
intercst
9 Likes
If that is true how do you explain lumber?
There is a reason the invisible hand doesn’t work.
And there never has been.
5 Likes
It was interesting that Alan Greenspan believed that nonsense all the way up to the 2008 Financial Crisis.
“I thought capitalism was self-correcting”
Well-regulated capitalism, where competitive markets are maintained – perhaps. American-style, crony capitalism – no way.
https://www.pbs.org/wgbh/pages/frontline/warning/themes/greenspan.html
intercst
7 Likes
Like with some commodities (like oil), supply and demand is mostly a greater effect than inflation
Mike
4 Likes
Bachelor Chow is on sale at Meijer this week: $2. Same price as five, or more, years ago.
Steve
Exactly Mike so deflation is not a bad thing as long as it isn’t a deflation in Wages. Now lumber has come way down even with the tariffs imposed on Canada.
2 Likes
I’ve been throttling my donut consumption by only buying them when they’re on sale. Regular price is $10/dozen at Safeway, about once a month they’re included in the $5 Friday promotion for half that, plus I had a $2-off coupon so I got them for $3/dozen. That’s probably as cheap as I’ve bought a dozen donuts in ten years. But I’d never pay full price for anything at Safeway. Most of the stuff is al least 50% higher than I can get it elsewhere.
intercst
Commodities such as lumber, oil, gold go up and down. That is different than the general rate of inflation. One of the biggies, of course, is the cost of labor which feeds into the cost of services and manufactured goods. Over the last 20 years the cost of labor is up 74%. The CPI over the same period is up 66%.
DB2
1 Like
Here is the thing Bob, most people do not understand supply and demand. They expect prices to go lower even when they compete with everyone else for more of the product. You know how you drive deflation? Start putting tariffs on everything to where no one will buy anything. Then when the prices start dropping, people keep waiting for the next lower price and Voila, you have a spiraling deflation. The great thing about it is nobody makes money and everyone becomes poor.
1 Like
Well, you don’t really want deflation, but the best thing to do is to increase productivity.
DB2
2 Likes
We’ve been doing that for 40 years, but very little of the benefit went to labor or the middle-class. Crony capitalism and rent-seeking behavior on the part of Private Equity captured most of the gains.
That’s why economics and politics favors early retirement and leisure over earning wage & salary income. As long as we can keep people ignorant of the arithmetic, the grift can continue unabated.
intercst
9 Likes