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US inflation means families are spending $709 more per month than two years ago

cnn.com

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Re: US inflation means families are spending $709 more per month than two years ago

#291

Post by Auracle »

brnaftr361 wrote: post #156
Auracle wrote: post #66

Earlier quoted context omitted.

On the whole? No. People that were making near minimum wage before absolutely have though, and I think that's been a huge driver of the inflation. Pre-pandemic, the Walmart in our area had a starting wage of $10 or $11 an hour. It's now $18.

Can you verify the position, hours, benefits, and expectations of those offers? 'Cause I can offer (up to!) $18.50 and then negotiate down. I can also give somebody 10 hours a week and duly provide no benefits. When I worked there they took me on PT no benies, and only after proving myself did they extend an offer for FT employment. PT can be highly flexible as to the definition. Whether it's a permanent or temporary…

I can. I do high school senior photography and I asked the kids last year where they worked, and how much they made doing it. Oddly, that doesn't seem rude to ask 17 year olds.

The ones working at Walmart absolutely made $17 an hour (then). It's Walmart. They aren't playing games with stuff like that. I'm sure they're mostly doing under 32 hours a week where possible with their employees as usual.

Re: US inflation means families are spending $709 more per month than two years ago

#292

Post by dualityoftapirs »

mahogany wrote: post #238
dualityoftapirs wrote: post #225

Earlier quoted context omitted.

It's more the bigger investments that drive a lot of the economy that are the concern - think real estate and stocks. Why buy a $1 million home today if you'll be able to buy it from $980k next year, and maybe $965k the year after that? More importantly, why continue paying the mortgage on your million dollar home when it's likely never to be worth a million again? Why buy 10,000 shares of a company now, when in a fe…

That's fair - but that is assuming indefinite long-term deflation. What about intermittent modest deflation as a tool to bring prices down? It seems that just the idea of deflation is immediately rejected in any conversation about monetary policy. Also, I think in the real world today, a home would still sell in a deflationary environment, given serious supply shortages. Especially for those buyers which are looking…

The fear with trying for temporary deflation is it will become an out of control feedback loop, because there aren't as many "reasonable" monetary tools to combat it as there are with inflation.

Re: US inflation means families are spending $709 more per month than two years ago

#294

Post by twoodfin »

xyzzy123 wrote: post #272
twoodfin wrote: post #213

Earlier quoted context omitted.

One reason is that in aggregate it doesn’t matter all that much: The differences between US means and medians for household financial stats are substantial but not overwhelming—and more importantly in this context, largely trend together. https://fred.stlouisfed.org/graph/?g=17Pem https://fred.stlouisfed.org/graph/?g=17Ped

If I am reading these graphs correctly, don't they support hikingsimulator's point? The mean has gone up but the median has gone down.

Oops: The mean one is in current (nominal) dollars. Here’s the inflation-adjusted version:

https://fred.stlouisfed.org/graph/?g=17PWA

Re: US inflation means families are spending $709 more per month than two years ago

#295

Post by CalRobert »

qbasic_forever wrote: post #16
candiddevmike wrote: post #4

As a parent with kids, I really don't know how folks are getting by with the prices of everything. I know folks who keep eating out, buying new vehicles, and even building new houses and I'm left scratching my head wondering how they afford all of this. I'm not saving nearly as much as I was years ago and I think my "lifestyle" has decreased post COVID (few vacations, eating out is a treat, gifts are for birthdays/ho…

There is a _LOT_ of debt being added, household debt is up to something like 17 trillion dollars from like under 10 trillion pre pandemic. IMHO vehicles are huge drivers of debt. There are almost no cars under $30k now, and the average sale price of new cars is pushing up near $50k. This is for bog standard stuff like Hondas and Fords, not luxury cars. Used cars are incredibly expensive too. People are financing cars…

Just moved to the Netherlands and being car-free covers something like half the rent alone. Nevermind that I don't have to deal with taking it to the shop, to get smogged, paperwork for reg and tax and insurance, etc. etc.

Re: US inflation means families are spending $709 more per month than two years ago

#296

Post by bluGill »

gruez wrote: post #264
bluGill wrote: post #153

Earlier quoted context omitted.

The existence of one car under that price doesn't dispove anything. Almost no cars are under 30k.

>The existence of one car under that price doesn't dispove anything The corolla isn't some niche car. It's the 12th best selling car in america with 222k units sold per year. https://www.caranddriver.com/news/g39628015/best-selling-car...

But there are models above the base.

Re: US inflation means families are spending $709 more per month than two years ago

#297

Post by prepend »

candiddevmike wrote: post #4

As a parent with kids, I really don't know how folks are getting by with the prices of everything. I know folks who keep eating out, buying new vehicles, and even building new houses and I'm left scratching my head wondering how they afford all of this. I'm not saving nearly as much as I was years ago and I think my "lifestyle" has decreased post COVID (few vacations, eating out is a treat, gifts are for birthdays/ho…

I switched from regular grocery stores to aldi/lidl/walmart. And from eating out 2-4 times a month to eating out 1-2 times.

I also switched to more staple foods like lentils and beans and rice and canned vegetables instead of fresh vegetables. And to buying ground beef on sale and freezing.

It seems kind of crazy that prices keep going up and even simple “luxuries” like a coffee while networking went from $3.5 for a small latte at my local coffee shop in 2019 is now $5.5.

I think for some people it doesn’t seem to affect them and they just pay the higher prices but base costs seem to have really gone up a lot for my family. Fortunately some big expenses are fixed (mortgage and transport) but if they had to change it would be extra rough.

Re: US inflation means families are spending $709 more per month than two years ago

#298

Post by prepend »

JumpCrisscross wrote: post #100
qbasic_forever wrote: post #16

Earlier quoted context omitted.

There is a _LOT_ of debt being added, household debt is up to something like 17 trillion dollars from like under 10 trillion pre pandemic. IMHO vehicles are huge drivers of debt. There are almost no cars under $30k now, and the average sale price of new cars is pushing up near $50k. This is for bog standard stuff like Hondas and Fords, not luxury cars. Used cars are incredibly expensive too. People are financing cars…

> is a _LOT_ of debt being added, household debt is up to something like 17 trillion dollars Household debt to GDP is around at a multi-decade low [1]. Payments as a fraction of disposable income, similarly low [2]. Total debt is rising [3]. But non-housing debt rose 5.8% from Q2 2022 to the same quarter '23; that's about inflation. [1] https://fred.stlouisfed.org/series/HDTGPDUSQ163N [2] https://fred.stlouisfed.org/…

I think the issue that this metric doesn’t measure is that there are households with debt. And there are many that don’t even keep credit card debt.

So the metric to measure “working class burden” (or whatever) is the percent increase in consumer, non-housing debt for people who had debt.

Well off people who went from $0 credit card debt to $0 while having their networth double since 2020 (high gdp) are not very useful to predict bankruptcy or political upheaval like people who went from $5k to $40k in credit card debt, are renting so didn’t see their networth go up and had their wages increase 5-10%. Those people are having a really rough time. And are worse off now day to day, and have increased exposure to risky negative events.

Re: US inflation means families are spending $709 more per month than two years ago

#299

Post by the_only_law »

Auracle wrote: post #86
ModernMech wrote: post #14

Every year for the past 5 years I’ve gotten a “merit raise” which hasn’t met inflation, so I’m effectively making less than I was when I started at my job despite having 5 years more experience. My organization puts a negative value on experience, and the only way I can get an actual raise is to jump ship. The story of my generation. Meanwhile they complain about a hiring and retention problem. Gee, I wonder why?

I get a kick out of our local A&W that's had the usual "please be patient we don't have enough workers" sign up for at least a year, with another sign under it saying they're hiring starting at $10 an hour. I wonder why they don't have enough workers when almost every other retail business around pays 50% or more than that, and it's not like their employees would have to go through a grueling tech hiring process to j…

Reminds me of when I was visiting a couple years ago, seeing commercials being run by companies desperate for skilled labor, while paying less than the local McDonald’s…

Re: US inflation means families are spending $709 more per month than two years ago

#300

Post by Perceval »

mahogany wrote: post #97
tmountain wrote: post #46

Earlier quoted context omitted.

Governments are afraid of deflation (prices going down) because consumers can go into a holding pattern (stopping spending while waiting for prices to continue to decrease) which can cause the economy to stall out.

Is there any evidence that modest deflation actually causes this "holding pattern" in the overall economy? I see this theory stated a lot for the reason that deflation is bad, and it definitely checks out on a basic logical level. But economics is complex right? So I'm curious what the evidence is in the real world. I can imagine this happening with large deflation (10%, say), but what about 2% or 1%? It's not obviou…

There was a 20-year period of mild deflation during the Victorian Era: https://en.wikipedia.org/wiki/The_Great_Deflation

Broadly it was a time of sustained growth in both the United States and United Kingdom, despite the deflation which was driven by industrialization and productivity gains. However, certain industries did suffer as a result of the deflation, so it was neither an unvarnished good or bad economic period.

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