Hacker News Board Hacker News, browsed like a classic message board
Live data from Hacker News

The problem isn't inflation. It's prices. What goes up may not come down

vox.com

Post reply on HN
Print view View original

81–88 of 88 posts

Re: The problem isn't inflation. It's prices. What goes up may not come down

#81

Post by iteratethis »

Isn't it weird how roughly speaking, things you do not strictly require tend to get cheaper over time whilst things you absolutely need get ever more expensive or at least not cheaper?

It seems the true needs of survival need to be sufficiently expensive otherwise you can't boss people around.

Re: The problem isn't inflation. It's prices. What goes up may not come down

#82

Post by senectus1 »

cpr wrote: post #69

The problem is utterly simple. If you print dollars (created out of nothing), the value of each dollar goes down, since nothing of value has been created or destroyed. You have more dollars chasing the same value. But of course the official narrative has to shield the Fed from criticism, so they can run the dollar machine with impunity.

this lever on inflation is delayed though.

like they print a billion today, we dont see the inflation effect for a couple of years.

there are other effects that trigger inflation as well.

Re: The problem isn't inflation. It's prices. What goes up may not come down

#83

Post by _heimdall »

hiddencost wrote: post #14
_heimdall wrote: post #8

Earlier quoted context omitted.

That's the point though, the Fed main lever to lower inflation is causing pain in the market. When they say soft landing they really just mean they believe they can break things just enough to cool down the economy and get back to the magic number of 2-3% inflation.

The article frames it as "the number is too high because people don't understand inflation on an emotional level", which seems condescending and wrong, to me.

Totally agree with you there, I also think that framing is just flat wrong.

Re: The problem isn't inflation. It's prices. What goes up may not come down

#84

Post by tjansen »

I think an underrated aspect of inflation is the need (or opportunity) of corporations to increase margins. Interest rates are going up, so the stock market expects corporations to increase earnings per share and dividends as well. Also, a lot of corporations are in debt, especially after the covid years, and need higher margins to pay it off, or at least pay higher interest rates. The craziest price increases I have seen in German supermarkets were Pepsi Corp products, Mars and Coke. They are all way higher than no-name alternatives (like 1.5l Coke bottles for 1.79, while no-name brands are 0.59 EUR; and yes, I know that's still cheap compared to many other countries). The prices of a lot of store-branded products have actually come down, but the prices of international brands keep rising.

Re: The problem isn't inflation. It's prices. What goes up may not come down

#85

Post by jmopp »

charcircuit wrote: post #41
erellsworth wrote: post #22

Earlier quoted context omitted.

In a perfectly competitive market, yes, profits go to zero. https://www.investopedia.com/ask/answers/031815/why-are-ther... But there's no such thing as a perfectly competitive market.

Why would someone bother selling something if there was no profit to be made?

"Oh, what am I to do with all this wheat that grew on my field?"

Re: The problem isn't inflation. It's prices. What goes up may not come down

#87

Post by pjmorris »

charcircuit wrote: post #41
erellsworth wrote: post #22

Earlier quoted context omitted.

In a perfectly competitive market, yes, profits go to zero. https://www.investopedia.com/ask/answers/031815/why-are-ther... But there's no such thing as a perfectly competitive market.

Why would someone bother selling something if there was no profit to be made?

One example: A farmer might choose to sell his produce at cost so it won't rot, so he can pay his bills and so the surrounding population can eat.

A profit would be nice, but there's more to it than profit, e.g. paying the bills and social stability.

Post reply on HN