How are retirees on fixed incomes coping with the surge in food and energy prices? (Vancouver, beach)
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The Inflation Rate has been steady around 3% to 4% since 1983. Through several different Administrations and throughout differing levels of Money Printing.
The data does not support your premise - inflation averaged 2.6% between 1983 and 2020. Under the last admin, inflation averaged under 2%, during the current administration, it has averaged well over 6%, with a 8.5% increase since the last COVID relief bill - inflation is up significantly in the last year at a much higher rate than the last 40 years preceding. 1981, under Carter, was the last time inflation was anywhere near this high.
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Originally Posted by FiveLoaves
When the News tells you that Gasoline Prices are the highest in 40 years -- Simple Math should point you to the right year. It's not a secret.
As far as gas prices, in June 2008 gas was over $4, a price that only surpassed in the last few months - so no not "simple math" that it is due to time as you imply. From 2011 to 2014 gas hit about $4 several times again but was under $3 from Nov 2014 till April 2021 - gas was actually at a low in April 2020, at well under $2 - now gas is way over double the cost, at $5 in just the last year.
So unless you have a time machine, the gas prices are not close to a linear increase. The data doesn't lie - here is the data from the US government on gas prices at eia.gov - https://www.eia.gov/dnav/pet/hist/Le...te_nus_dpg&f=m
Inflation is real and is hurting everybody, especially those that are not able to change income with the price increases - trying to play it off as if it is not a big deal is not right or close to accurate.
Interesting. I remember the flap over the foot-long...
'You may recall the lawsuit against Subway Restaurants for selling "12 inch" and "footlong" sandwiches that were allegedly less than 12 inches long. The case attracted lots of media attention and consumer s******s because of Subway's ubiquity (and the endless possibilities for double entendres). However, the lawsuit's denouement turned out to be far less titillating. Subway agreed to settle the case for about a half-million dollars--almost all of which goes to the plaintiffs' lawyers--plus some minor changes in Subway's practices, such as additional disclosures to consumers. See the settlement website." -- Forbes article
I hadn't heard this about the bread. We very rarely go to Subway, but we recently visited the just-opened Eataly not too far from us in San Jose. I think there are about eight in America now. The first one we went to is in Chicago. Very cool deal, but not for anyone looking for cheap Italian foods! That's for sure. They have just about any Italian food or drink you might be looking for however. Three floors of stuff with restaurant and outside patio area. Very nicely done. Even to just walk through.
Ah, you have Eataly out there? Such a great place. First one in NYC opened around 2007/8 in the Flatiron district, and then another opened downtown at the World Trade Center.
This is the worst inflation I've seen in 40 years...How are members in here coping with these spikes in the COL?
You are right. This
has definitely impacted our travel plans. Shorter trips instead of cross country excursions. Diesel is up 50% in one year so you know what you can do with your massaged low inflation numbers.
Definitely impacted our travel plans. Shorter trips instead of cross country excursions. Diesel is up 50% in one year so you know what you can do with your massaged low inflation numbers.
Or semi. Have seen a "Vehicle Dweller" take a Semi and add a complete house on the rear of it. Yes, it was VERY high dollar build, but some people invest well and reap the benefits
One industry is not indicative of a widespread issue. But even the industry you picked seems to be not quite an issue as you think - they are not likely to settle because no proof and the charges of price fixing were well before the current inflationary period - so not related to recent price increases. The charges were in a civil suit that was dismissed against these firms in 2020 because of no evidence.
Also according to Tyson's annual report - even with meat prices rising, demand continues to outpace supply. They report that labor costs have risen 20%, grain is up 29% and cattle costs up 22%, while freight costs are up 32%. With demand outpacing supply, along with higher input costs, labor shortages and capacity constraints - this has led to higher prices. That is expected - demand increasing faster than supply will cause an increase in prices - basic economics of supply / demand.
BTW - The digital.com survey is pretty much junk - it is based on opinions not data collected.
We are the victims of having to depend on a very few meat and produce processors, something they have been taking advantage of for years. This is the first time I've seen anyone do anything about it. And Tyson doesn't pay for grain that's BS the rancher does and according to everything I've read Ranchers are getting the same thing for a cow that they got 3 years ago.
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Late last month, Tyson Foods Poultry division agreed to pay $221.5 million to settle several private lawsuits brought by poultry buyers who accused the corporation of colluding with competitors to raise chicken prices. Tyson joins other dominant poultry and pork corporations in settling private price-fixing suits after Pilgrim’s Pride pled guilty to similar charges brought by the Justice Department this fall. https://www.thefencepost.com/news/ty...-fixing-suits/
And the biggest driver of inflation is energy prices, not chicken wings, and it causes inflation to increase on everything that has to be transported by truck or air. The war in Ukraine caused much of that but the deal that Trump made with OPEC in 2020 to get them to reduce the supply of gas the US gets so that prices would increase rewarding US energy companies. https://www.reuters.com/article/us-g...-idUSKBN22C1V4
Not sure who is arguing what here, but clearly the cost of energy affects the cost of just about everything, because it takes energy to get everything to market. The cost of transportation goes up, that cost gets passed along to the consumer, and then the consumer decides what to continue paying for or what to go without.
What you've just described is a change in relative prices based on how much energy is used to make & get products to market. But that is not a change in the general price level of all goods and services (inflation.)
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Originally Posted by FiveLoaves
But I keep hearing about 'the Printing Press' and the 'Democrats' from various corners. The Inflation Rate has been steady around 3% to 4% since 1983. Through several different Administrations and throughout differing levels of Money Printing.
There are at least 3 general ways to finance the fiscal stimulus
Raise tax revenue to finance stimulus payments (kind of counter-productive)
Print money to finance the stimulus payments (this is effectively the same thing as borrow the money, for the purposes of this discussion) <== this is what we did
Displace other government spending, redirecting money to stimulus payments (also a bit counter-productive)
At the time the Pandemic hit, it was pretty much "Ready, Fire, Aim." Only later could it become "Ready, Aim, Fire."
... we recently visited the just-opened Eataly not too far from us in San Jose. I think there are about eight in America now. The first one we went to is in Chicago. Very cool deal, but not for anyone looking for cheap Italian foods! That's for sure. They have just about any Italian food or drink you might be looking for however. Three floors of stuff with restaurant and outside patio area. Very nicely done. Even to just walk through.
The underlying cause of our current inflation is no mystery. Starting in March 2020, the US government created about $3 trillion of new bank reserves (an equivalent to cash) and sent checks to people and businesses. The Treasury then borrowed another $2 trillion or so and sent even more checks. The total stimulus comes to about 25% of GDP, and to around 30% of the original federal debt. While much of the money went to help people and businesses severely hurt by the pandemic, much of it was also sent regardless of need, intended as stimulus (or “accommodation”) to stoke demand. The goal was to induce people to spend, and that is what what people have been doing.
Other purported factors – including "energy prices," “supply shocks,” “bottlenecks,” “demand shifts,” and corporate “greed” – are not relevant to the overall price level. The ports would not be clogged if people were not trying to buy lots of goods. If people wanted more TVs and fewer restaurant meals, the price of TVs would go up and the price of restaurant meals would go down. Greed did not suddenly break out last year.
By contrast, inflation -- when all prices and wages rise together -- comes from the balance of overall supply and demand. The US economy’s capacity to produce goods and services turns out to be lower than economists expected. Here, the labor shortage – the “Great Resignation” – is a key underlying fact. Employers can’t find people to work because many people remain on the sidelines, not even looking for jobs.
The US Federal Reserve was completely surprised by the surge of inflation, and through most of last year insisted it would be “transitory,” and go away on its own. That turned out to be a major institutional failure. It is the Fed’s main job to understand the economy’s supply capacity and fill – but not overfill – the cup of demand.
Why did this fiscal stimulus produce inflation when previous stimulus efforts from 2008 to 2020 fizzled? There are several obvious possibilities. First, this stimulus was much bigger. Former US Secretary of the Treasury Lawrence H. Summers correctly prophesied inflation in May 2021 by simply looking at the immense size of the spending packages, relative to any reasonable estimate of the GDP shortfall. (https://www.washingtonpost.com/opini...-risk-is-real/)
Second, officials misunderstood the COVID recession. GDP and employment did not fall because there was a lack of “demand.” In a pandemic, you can send people all the money in the world and they still won’t go out to dinner or book a flight, especially if those services are suspended by government fiat. To the economy, a pandemic is like a blizzard. If you send people a lot of money when the snow is falling, you do not get activity in the snowdrifts, but you will get inflation once the snow has cleared.
Third, unlike in previous crises, the government created money and sent checks directly to businesses and households, rather than borrowing, spending, and waiting for the effect to spread to incomes.
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