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Milk around here varies depending upon sales etc. our state has a law that you cannot sell below cost (loss leader), other states do not have such laws. It also depends upon the store overhead and other factors so your question needs more specific parameters for me to answer.
Then you responded to the wrong person.
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Your second sentence is a little hard to follow but um....common inflationary indexes like Paasches and Laspreyes both would use bundles of goods and services to measure inflation.
Such as milk and oil, I assume?
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What's interesting is that let's say there is inflation in fuel and other costs. It might be that the milk (or other) producers have unequal negotiating power with the sellers. It may not even show up to the consumer as it may just come out of the profits of the supplier etc. Then we could get into the whole short-term vs long-term thing.
So why would you subscribe to the idea of cost of milk indicating that we're in inflationary cycle? Or, do you not?
So why would you subscribe to the idea of cost of milk indicating that we're in inflationary cycle? Or, do you not?
It would depend on how rigorous the economic and financial analysis was and whether the major covariant factors could be identified and adjusted for.
In general, it's just easier to use a LARGE basket of goods and services and then make the (reasonable) assumption that the various non-inflationary price impacts (random noise) would cancel each other out.
ie) A freeze driving up strawberry prices is countered by a bumper crop of peaches.
As a single dad, I'm one of the few guys that actually buys a lot of groceries, cooks and is aware of prices. Unquestionably there has been inflation at the grocery store but in many ways they have adjusted for it by offering smaller sizes rather than increasing prices. There have been a lot of articles about this phenomenon and it jives with my personal anecdotal experience.
I've dealt with some of the increase via substitution though, as I'm sure many others have as well.
It would depend on how rigorous the economic and financial analysis was and whether the major covariant factors could be identified and adjusted for.
In general, it's just easier to use a LARGE basket of goods and services and then make the (reasonable) assumption that the various non-inflationary price impacts (random noise) would cancel each other out.
ie) A freeze driving up strawberry prices is countered by a bumper crop of peaches.
As a single dad, I'm one of the few guys that actually buys a lot of groceries, cooks and is aware of prices. Unquestionably there has been inflation at the grocery store but in many ways they have adjusted for it by offering smaller sizes rather than increasing prices. There have been a lot of articles about this phenomenon and it jives with my personal anecdotal experience.
I've dealt with some of the increase via substitution though, as I'm sure many others have as well.
Milk and oil are pretty basic staples in almost every household worldwide.
The government excludes food/energy from inflation like eating and using oil is optional ?
Pretty much though you cannot substitute for milk or oil.
As prices increase these staples are still purchased and cuts are made in other areas.
The inelasticity of gasoline changes at somewhere around $4/gallon. That's about the rate where consumers pull their heads of their backsides and start using it more wisely.
The inelasticity of gasoline changes at somewhere around $4/gallon. That's about the rate where consumers pull their heads of their backsides and start using it more wisely.
Yup. When I was working and gas spiked I started working from home 1 day a week to save on gas. Also changed my shopping habits to do it all in one day and in a logical loop so I wasn't going back and forth wasting gas.
Lots of coworkers did the same. Once gas came down though it went back to BAU for many.
Location: Just transplanted to FL from the N GA mountains
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Originally Posted by noexcuseforignorance
The inelasticity of gasoline changes at somewhere around $4/gallon. That's about the rate where consumers pull their heads of their backsides and start using it more wisely.
I do not doubt what you say, but my question is.... how do they use it more wisely? By taking public transportation? What if that's not available? If taking public, are they not just substituting one usage for another?
Yes , the term " use it more wisely " doesn't have much meaning . Public transportation is only feasible in some of the largest cities . I think it's funny when fashion models and actors are featured in ads telling us to ride the bus while they run their 8 cylinder limousines up and down the streets .
the Obama administration has repeatedly announced their intention to raise fuel prices to a minimum of $6.00 per gallon to " encourage people to conserve " . The only problem with this is that it only affects blue collar workers and the poor . It also can be very destructive for our economy and many people don't have an available alternative option .
Yup. When I was working and gas spiked I started working from home 1 day a week to save on gas. Also changed my shopping habits to do it all in one day and in a logical loop so I wasn't going back and forth wasting gas.
Lots of coworkers did the same. Once gas came down though it went back to BAU for many.
Why would anyone want to commute an extra day if they don't have to ?
Also , most people already combine trips . Why would anyone want to take an extra trip if it wasn't necessary ?
It would depend on how rigorous the economic and financial analysis was and whether the major covariant factors could be identified and adjusted for.
In general, it's just easier to use a LARGE basket of goods and services and then make the (reasonable) assumption that the various non-inflationary price impacts (random noise) would cancel each other out.
ie) A freeze driving up strawberry prices is countered by a bumper crop of peaches.
As a single dad, I'm one of the few guys that actually buys a lot of groceries, cooks and is aware of prices. Unquestionably there has been inflation at the grocery store but in many ways they have adjusted for it by offering smaller sizes rather than increasing prices. There have been a lot of articles about this phenomenon and it jives with my personal anecdotal experience.
I've dealt with some of the increase via substitution though, as I'm sure many others have as well.
For years, lower prices were achieved via importing from cheap markets, just as corporate profitability and "stock holder interests" have been held high by laying off people. There comes a point when you can't go further, because people aren't in a position to pay more (the fact that incomes for what makes the consumers declined following the peak in 2000), leads to next logical step: reduced size. Although, that doesn't really apply to milk, because a gallon then is a gallon now. If you're using it as a measure of inflation, and claiming that we're in unprecedented inflationary times (whereas, a depression would actually reverse that) should be reflected in the prices. The question is: Is it?
I think in current dollars, the price of a gallon of milk is pretty much where it has been for last 10 years, if not more. I recall paying a little over $2/gallon in late 90s when I moved to Texas. It is about that, today.
The argument, perhaps, should be that using current price of something like milk and gasoline to make a point on inflation is being out of touch with how things work. I doubt $4.12/gallon for gas prices in June-Aug 2008 was reflection of a period under super inflation.
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