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Food Prices Are Soaring Faster Than Inflation and Incomes

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Re: Food Prices Are Soaring Faster Than Inflation and Incomes

#361

Post by throwawaygh »

dominotw wrote: post #356
throwawaygh wrote: post #346

Earlier quoted context omitted.

> Avg income in my neighborhood is ~49k but a 2 bed condo here are selling for 450K and getting outbid by 75k over the asking price. Its insane. Sure, and your point about housing prices mattering is a good one (see my other comment on this story). But, this describes maybe a few dozen housing markets. Probably only a couple dozen if you cut out resort/ski towns. It's a regional problem, not systemic problem with the…

> But, this describes maybe a few dozen housing markets. Its a national problem https://www.redfin.com/us-housing-market 'few dozen' is what like 3 dozens? Assuming its a problem only in 36 markets. Wouldn't that be a 'national problem' ? 36 markets should covers a majority of population in the country.

Because relatively few regional housing markets have non-luxury 2 bed condos going for $525,000 (75K over 450K, per your original post).

E.g., in the Midwest you'd have to be in a nice part of Chicago or choosing the most expensive city neighborhood of a mid-sized city to find a meaningful number of $525K 2 bed condos. And even then, spending that much on a condo is 100% an unnecessary luxury. 10 minutes in any direction prices will crater, and by the time you get to the suburbs starter homes are from the $200s and $525K is a mansion. For the entirety of the midwest and most parts of the south.

Even on the coasts $525K for a 2 bed condo is a Big City thing. E.g., $500-$700K is the going rate for 2 bed condos in most of Boston, but drive an hour away from Boston in any direction? Not so much. Hell, even Wakefield has a 2 bed condo below $300K and that's only a 25 minute drive. And that's one of the more expensive housing markets in the US.

Living 20 minutes from major city centers via public transit has become a luxury, sure. But it's just not accurate to say that $525K for a 2 bed condo is "normal" in the US. It's not. It's quite specific to a very high CoL markets.

Re: Food Prices Are Soaring Faster Than Inflation and Incomes

#362

Post by exhilaration »

mnw21cam wrote: post #140
Broken_Hippo wrote: post #81

Earlier quoted context omitted.

Food consumption changes: Pre-pandemic, a good amount of meals would be eaten out of the house. School lunches, breakfast on the way to work, lunch break at the work cafeteria or a fast food place (sure, some folks bring lunch, but many places don't offer a break room that is adequate). All of this - and things like toilet paper - shifts to consumer goods instead of bulk goods, which takes different equipment and pro…

In the UK, last year we had a terrible shortage of bread flour in the supermarkets. Actually, what we had was a sudden reduction in the amount of flour being used by bakeries, and an increase in the amount of flour being used at home. There wasn't a shortage of flour - there was a shortage of small bags to put it in for selling at a supermarket. The industry was all set up for selling a decent proportion of flour in…

We had flour shortages in the US as well. I wonder if that was the case across the Western world.

Re: Food Prices Are Soaring Faster Than Inflation and Incomes

#363

Post by pwm »

em500 wrote: post #336
fennecfoxen wrote: post #291

Earlier quoted context omitted.

> CPI is absurd, it only perpetuates consumerism and punishes savers. Okay okay back up. The consumer price index is a series of numbers designed to help people understand what dollar-denominated figures mean to ordinary people going about their lives, spending those dollars. If that's "consumerism," well yes, it's a portrait of consumerism. Many economists, mind you, believe CPI doesn't correct quite enough, and sus…

There's a ridiculous amount of misconception, FUD, and ignorance around inflation / CPI (it doesn't include housing, it overweights entertainent, it exclude food and energy, hedonic adjustments/basket substitutions make everything look artificially cheap) To professional economists, it can be infuriating to read (I imagine similar as medical professionals reading antivax blogs/comments, or radio engineers reading abo…

I'm not an economist.

My layman understanding of inflation is that it is the measure of change of purchasing power a unit of currency has over time. I think most laymen, including myself, questions how this rather theoretical concept is actually measured in real life. Eg. I think it is a sensible expectation that if inflation was said to be 2% for 20 years then I should be able to buy a house that cost $200K 20 years ago for ~$300K now. This expectation is worlds away from reality which then prompts people to question the way inflation is measured.

I know you wrote that you don't really have the inclination anymore to educate on the topic but I for one would be grateful for any pointers how to explain the above discrepancy?

Re: Food Prices Are Soaring Faster Than Inflation and Incomes

#364

Post by whoisninja »

gruez wrote: post #334
kache_ wrote: post #269

Earlier quoted context omitted.

Everyone knows CPI is not analogous to reality. Why would it be. Just look at house prices

Because houses are assets, which are closer to stocks than food or cars.

agreed because housing/RE is also used for speculation/investment and not just utility what portion of valuation is utility in what point in time is hard to tell

Re: Food Prices Are Soaring Faster Than Inflation and Incomes

#365

Post by dominotw »

throwawaygh wrote: post #361
dominotw wrote: post #356

Earlier quoted context omitted.

> But, this describes maybe a few dozen housing markets. Its a national problem https://www.redfin.com/us-housing-market 'few dozen' is what like 3 dozens? Assuming its a problem only in 36 markets. Wouldn't that be a 'national problem' ? 36 markets should covers a majority of population in the country.

Because relatively few regional housing markets have non-luxury 2 bed condos going for $525,000 (75K over 450K, per your original post). E.g., in the Midwest you'd have to be in a nice part of Chicago or choosing the most expensive city neighborhood of a mid-sized city to find a meaningful number of $525K 2 bed condos. And even then, spending that much on a condo is 100% an unnecessary luxury. 10 minutes in any direc…

Ah yea i see what you mean. that might be an exception to suburbs of altanta. It was just an example of insanity of housing market in USA. I was not implying that the going price of condo.

Re: Food Prices Are Soaring Faster Than Inflation and Incomes

#366

Post by derefr »

ErikAugust wrote: post #243
whoisninja wrote: post #237

CPI is a joke, they do something called hedonic adjustments to things like tech products etc. It's completely subjective and BS. Technology is deflationary, things should get cheaper because we go after producing them in creative ways one demand is high. CPI is absurd, it only perpetuates consumerism and punishes savers. We product 2x the food society consumes - mostly wasted away, just with some supply chain efficie…

Real question that nobody has yet answered: With what data CPI is even calculated? The data sources are all hidden. Related: https://news.ycombinator.com/item?id=26259279

The input to CPI is secret shoppers visiting a variety of retail outlets, and buying things (or write down the advertised prices for things) without telling the retail outlet what they’re doing.

Publishing the particular products looked at, or even the particular stores visited, would invite market manipulation of the CPI figure by re-pricing the included goods.

Re: Food Prices Are Soaring Faster Than Inflation and Incomes

#367

Post by pmlnr »

pietrovismara wrote: post #161
pmlnr wrote: post #100

Earlier quoted context omitted.

"The reason that the rich were so rich, Vimes reasoned, was because they managed to spend less money. Take boots, for example. He earned thirty-eight dollars a month plus allowances. A really good pair of leather boots cost fifty dollars. But an affordable pair of boots, which were sort of OK for a season or two and then leaked like hell when the cardboard gave out, cost about ten dollars. Those were the kind of boot…

> "The reason that the rich were so rich, Vimes reasoned, was because they managed to spend less money. > So in short: no. Everyone is wasting. The wealthiest 20% of the world's population consume 80% of resources, while the poorest 20% lack the basics to survive. It just takes 40 seconds of research to completely disprove your point.

Wasting is wasting; small or big wasn't the question.

Re: Food Prices Are Soaring Faster Than Inflation and Incomes

#368

Post by CyberRabbi »

fennecfoxen wrote: post #291
whoisninja wrote: post #237

CPI is a joke, they do something called hedonic adjustments to things like tech products etc. It's completely subjective and BS. Technology is deflationary, things should get cheaper because we go after producing them in creative ways one demand is high. CPI is absurd, it only perpetuates consumerism and punishes savers. We product 2x the food society consumes - mostly wasted away, just with some supply chain efficie…

> CPI is absurd, it only perpetuates consumerism and punishes savers. Okay okay back up. The consumer price index is a series of numbers designed to help people understand what dollar-denominated figures mean to ordinary people going about their lives, spending those dollars. If that's "consumerism," well yes, it's a portrait of consumerism. Many economists, mind you, believe CPI doesn't correct quite enough, and sus…

> But if someone's "punishing savers" and "perpetuating consumerism", it's not the index, and it's not the people compiling the index, and it's not the people trying to make the index more accurate by adjusting for quality.

I’ve seen this a lot around the net and I’m honestly and genuinely curious. What drives you to defend the CPI?

Re: Food Prices Are Soaring Faster Than Inflation and Incomes

#369

Post by fennecfoxen »

porknubbins wrote: post #234
Cthulhu_ wrote: post #157

Earlier quoted context omitted.

Common stock advice: if you hear about an investment opportunity, you've probably already missed out. Ex: Bitcoin stocks (yes they're stocks / investment products) are only really reported on when they're at an all-time high. They may go up a little more if you're reading something fresh off the press, but it's not going to go up as much as it already has. I mean if you bought a year ago you could have had a 10x retu…

If “hear about” means major media wrote a news story about it because it has gone up then yes. But I’ve learned about profitable investments from places like twitter, reddit etc if you are deeply plugged in to what is happening.

Or deeply plugged into the world of fantasies and pump-and-dump scams. It can be hard to tell.

Re: Food Prices Are Soaring Faster Than Inflation and Incomes

#370

Post by [deleted] »

em500 wrote: post #336
fennecfoxen wrote: post #291

Earlier quoted context omitted.

> CPI is absurd, it only perpetuates consumerism and punishes savers. Okay okay back up. The consumer price index is a series of numbers designed to help people understand what dollar-denominated figures mean to ordinary people going about their lives, spending those dollars. If that's "consumerism," well yes, it's a portrait of consumerism. Many economists, mind you, believe CPI doesn't correct quite enough, and sus…

There's a ridiculous amount of misconception, FUD, and ignorance around inflation / CPI (it doesn't include housing, it overweights entertainent, it exclude food and energy, hedonic adjustments/basket substitutions make everything look artificially cheap) To professional economists, it can be infuriating to read (I imagine similar as medical professionals reading antivax blogs/comments, or radio engineers reading abo…

[deleted]
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