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The true costs of inflation in small-town Texas

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Re: The true costs of inflation in small-town Texas

#131

Post by spaceman_2020 »

chomp wrote: post #66
nostromo wrote: post #51

I’ve seen some people showing actual price increases they’ve seen in their local communities. For a lot of folks it’s much higher than is being reported. Here’s one from a person in Seattle: https://preview.redd.it/max54wqv9kb91.png?width=1112&format=...

I'm super skeptical of posts like this because they seem cherry picked, or at best, have local price increases that aren't reflected elsewhere in the country. Half of those are restaurants, who have had challenges for the past 2 years outside of inflation. Gas has its own challenges, a head of lettuce at my local grocer is $1.52 which is cheaper than that person's 2021 price. Notably not included in that post is thin…

> My point isn't that inflation doesn't exist

Heads of lettuce are really poor markers for inflation. What percentage of your take home do you spend on lettuce anyway?

You're much better off looking at median rent and median home price. Which can be quantified and clearly shows a big uptick. And you're likely spend anywhere from 25-50% of your pay on them.

Re: The true costs of inflation in small-town Texas

#132

Post by ponco »

compumike wrote: post #59

The article presses only a single hypothesis (food input costs going up), but I don't think the article addresses the other side of balancing the books: it may just be a substantial drop in customer traffic to restaurants, even before price changes. It does seem that publicly-traded restaurants are being impacted far more than meat suppliers: https://totalrealreturns.com/s/TSN,CMG,MCD,QSR,DRI,BLMN I think the "Total…

Half the article discusses other factors? 1. staff shortages 2. very elastic customers 3. climate change.

Re: The true costs of inflation in small-town Texas

#133

Post by mellavora »

SoftTalker wrote: post #87
nostromo wrote: post #51

I’ve seen some people showing actual price increases they’ve seen in their local communities. For a lot of folks it’s much higher than is being reported. Here’s one from a person in Seattle: https://preview.redd.it/max54wqv9kb91.png?width=1112&format=...

Last year I could buy a whole chicken for roasting for about $10. Now they are $17 or so. 70% increase. Beef the same. Pork hasn't jumped as much for some reason. Ground turkey is about the most affordable meat I can find right now, but when you cook it you can see that it has a lot of water in it.

Avian flu resulted in mass culls.

Feed prices also higher due to Ukraine/grain shortages increasing demand for grain.

The very real price increases you are seeing are driven in part by very specific and focused economic shocks which exceed the baseline macro-level shock (officially measured at circa 10%, with all the caveats around that measure)

Re: The true costs of inflation in small-town Texas

#134

Post by Nick87633 »

konschubert wrote: post #117
once_inc wrote: post #114

Earlier quoted context omitted.

The term "Inflation" is used in two forms interchangeably by most people, and this leads to miscommunication. Inflation is used for: (a) price inflation: increasing prices for individual goods. (b) monetary inflation: an increase in the amount of money used. Both types of inflation means you get less goods for the same amount of (in this instance) Dollars. Monetary inflation (b) is mostly created by central banks and…

Inflation is when the ratio of / grows. This can happen by the numerator growing (your (a)) or the denominator shrinking (your (b)).

Seems like correlation more than causation. There could be plenty of money available but fearful people do not want to spend it.

Re: The true costs of inflation in small-town Texas

#136

Post by godmode2019 »

nostromo wrote: post #51

I’ve seen some people showing actual price increases they’ve seen in their local communities. For a lot of folks it’s much higher than is being reported. Here’s one from a person in Seattle: https://preview.redd.it/max54wqv9kb91.png?width=1112&format=...

In Australia you would need to double those prices, to be on the low end of prices.

Maybe we earn more money?

Re: The true costs of inflation in small-town Texas

#137

Post by somewhereoutth »

once_inc wrote: post #114
chomp wrote: post #66

Earlier quoted context omitted.

I'm super skeptical of posts like this because they seem cherry picked, or at best, have local price increases that aren't reflected elsewhere in the country. Half of those are restaurants, who have had challenges for the past 2 years outside of inflation. Gas has its own challenges, a head of lettuce at my local grocer is $1.52 which is cheaper than that person's 2021 price. Notably not included in that post is thin…

The term "Inflation" is used in two forms interchangeably by most people, and this leads to miscommunication. Inflation is used for: (a) price inflation: increasing prices for individual goods. (b) monetary inflation: an increase in the amount of money used. Both types of inflation means you get less goods for the same amount of (in this instance) Dollars. Monetary inflation (b) is mostly created by central banks and…

My understanding is that economists use the term inflation for the rise in prices - strictly the fall in value or purchasing power of a currency.

The increase in money is termed 'expansion of the money supply'. There are a number of measures of money supply, going from narrow, cash only, to broad to include cash like instruments.

There is a strong relationship between money supply and inflation, different schools of economic thought understand it differently, but in general when you increase the money supply, its purchasing power falls.

Ballooning asset valuations have largely/entirely been caused by QE and ultra low interest rates, other prices are going to be affected by this too. Supply side shocks of course play their part, but current inflation is probably primarily driven by this loose monetary policy.

Re: The true costs of inflation in small-town Texas

#138

Post by hgomersall »

konschubert wrote: post #117
once_inc wrote: post #114

Earlier quoted context omitted.

The term "Inflation" is used in two forms interchangeably by most people, and this leads to miscommunication. Inflation is used for: (a) price inflation: increasing prices for individual goods. (b) monetary inflation: an increase in the amount of money used. Both types of inflation means you get less goods for the same amount of (in this instance) Dollars. Monetary inflation (b) is mostly created by central banks and…

Inflation is when the ratio of / grows. This can happen by the numerator growing (your (a)) or the denominator shrinking (your (b)).

A moment's consideration would show that's too simplistic. Money available has been growing for years without any notable inflation. It's not like we all rush out to spend every bit of income we have, a fair amount gets saved which effectively neutralises it.

Re: The true costs of inflation in small-town Texas

#139

Post by Aeolun »

chomp wrote: post #66
nostromo wrote: post #51

I’ve seen some people showing actual price increases they’ve seen in their local communities. For a lot of folks it’s much higher than is being reported. Here’s one from a person in Seattle: https://preview.redd.it/max54wqv9kb91.png?width=1112&format=...

I'm super skeptical of posts like this because they seem cherry picked, or at best, have local price increases that aren't reflected elsewhere in the country. Half of those are restaurants, who have had challenges for the past 2 years outside of inflation. Gas has its own challenges, a head of lettuce at my local grocer is $1.52 which is cheaper than that person's 2021 price. Notably not included in that post is thin…

Hmm, I’m not in the US (Japan), but all prices have been rising. On top of that the yen went from 110 per $ to 140 per $, so that by itself inflates half of my recurring costs by 30%

Re: The true costs of inflation in small-town Texas

#140

Post by avidphantasm »

bee_rider wrote: post #4

> This year, Tyson Foods, the country’s largest meat processor, saw its first-quarter profits nearly double. Meanwhile, all over Texas, barbecue places have shut their doors: Two Sawers BBQ, in Floresville; 1836 BBQ, in New Braunfels; Brisket Bar-BQ, in Bellaire. Kinda curious what the long term plan is here for Tyson -- just sell directly to customers after all the restaurants have closed, I guess?

They should plan on being broken up. Way too much consolidation in meat processing has been allowed over the past few decades. According to Matt Stoller, cattle prices haven’t increased, though retail prices have: “But since 2015, the ‘meat margin’, or the spread between the prices ranchers get for their cows and the prices consumers pay at the supermarket, has widened dramatically. Despite high consumer prices, independent ranchers are losing money, and going out of business.“[1]

[1] https://mattstoller.substack.com/p/economists-to-cattle-ranc...

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