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I've noticed over the past few weeks or months that a lot of prices have been going down. Gasoline is way down. Local gas prices were above $4 in August and are now below $3. The price of milk at my local Sams Club is down to $3.05 per gallon, after having been closer to $4 and erratically going down for a while. The price of cooking oil at Walmart Supercenter is down to $2.24 per 48oz, after having been above $3. Real estate isn't selling as fast as it was a few months ago, and buyers are getting better deals.
How will we know when it's the start of massive deflation implying that stocks might keep going down for a long time?
Ahhhhh, don't think so. Ag commodity prices are down which would influence the price of milk. Less corn going to produce ethanol with the increase in oil production. There's a huge movement to shy away from GMO (genetically modified organisms) products which would also influence the price of corn oil. For health reasons, there has been a paradigm shift in food and drink consumption.
The 10 year treasury might be a better indicator of deflation.
Prices going down? Sorta funny as the seniors in the retirement forum are complaining about prices going up and the paltry SS COLA increase.bibam not saying one way or the other but it seems like they might be charging seniors more when they come to the register.
Prices going down? Sorta funny as the seniors in the retirement forum are complaining about prices going up and the paltry SS COLA increase.bibam not saying one way or the other but it seems like they might be charging seniors more when they come to the register.
HaHaHaHa...Prices go up whenever they swipe their medicare card.
I remember when gas was 15 cents/gallon and had a glove compartment full of S&H Green Stamps.
I wouldn't say so, gasoline is down here too, but only by a matter of $0.25 or so over last month, maybe $0.50 since the summer. Milk is about the same as last month and probably up $0.20/gallon since summer. We don't have price fixing laws here though, so most big grocers sell milk at cost to get you in the door, haven't seen it over $2 gallon ever as far as I can recall. I buy cooking oil so infrequently that I couldn't even tell you what it goes for.
I paid $2.85 for gas in Las Cruces last week. That was a welcome change, but as one author pointed out it does indicate a global slow down in demand. Whether that signals something more ominous or not isn't something we'll know until it's happened already. Borrowing trouble just gets you more to worry about than those few things you can control
There are 2 forms of deflation and it's important to distinguish IMO:
a) monetary - shrinking money supply that creates a deflationary depression, last seen in full force 1930 and before that to my knowledge after 1836. We got a short whiff in 2008/9. These are very devastating and fortunately better controlled now with monetary and fiscal policy.
b) commodity - steep falls in commodity prices can cause a fall in the general price level but for the US as a net consumer of commodities this is a welcome event (ok not so much Texas and North Dakota of course - but for the rest of us - yeah!).
I think prices are going down because we have more efficient production due to better technology. For example now we produce more oil then Arabia or Russia and again that is because better technology who give us more efficient way of production. In future trucks (who deliver food) will be all electric. (some of them are already all electric). So more efficient transport will mean cheaper foods. Solar panels on some buildings or SafeWay/WholeFoods will mean again efficiency and that will lead to prices go down.
There are tons of examples like this. We are becoming one really efficient nation. We just have to keep doing it because we are going in right way. This will probably lead to stronger dollar, high real estate prices, very very cheap gold/silver and other commodities and also much cheaper food then today.
Prices going down? Sorta funny as the seniors in the retirement forum are complaining about prices going up and the paltry SS COLA increase.bibam not saying one way or the other but it seems like they might be charging seniors more when they come to the register.
Problem is that the items that seniors purchase most are going up, while items that they don't purchase as much are the ones going down. That's why seniors are seeing more inflation. Gas is one item that is not purchased near as much as when they were working. Milk is something that isn't purchased as much as families with children. But looking at the big picture, the price of groceries has gone up, especially anything to do with produce. For example, I think that a buck or more for a single orange is ridiculous, yet that is about the going rate around here, even on sale. And the price of orange juice is up probably 20% even when on sale. Used to be that I could get Tropicana on sale 2 for $5. Now it's a minimum 2 for $6 and at one of my nearby stores it's 2 for $7 on sale. And that's just one item. I often see $1.50 for a single green pepper. Expand that over all produce and produce based items and you can see why their price complaints are legitimate. Beef prices are through the roof. Luckily chicken hasn't done that yet, but most people like to have a variety of foods in their diets. And remember this is all happening for people who are probably living on less than 80% of their previous income.
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