Key Points
- As shoppers await price cuts, retailers like Home Depot say their prices have stabilized and some national consumer brands have paused price increases or announced more modest ones.
- Yet some industry watchers predict deflation for food at home later this year.
- Falling prices could bring new challenges for retailers, such as pressure to drive more volume or look for ways to cover fixed costs, such as higher employee wages.
Inflation is a funny word for “price gouging.”
Right?
Like… It’s not some great mystery. We see inflation at 5% and prices go up 8, 10…15%…and the companies say it’s because inflation.
I am a private music teacher, and while most private teachers will go through a school to do lessons, I’ve just gone freelance and do it all myself. I get to set prices and recruit or not and I have so much freedom, but one thing I found was that in setting prices, people will pay what you say. If they can’t I’ll chat a bit to see what the situation is and see where I can make discounts of course, but wealthy families are willing to do $100 an hour easy. I know I could bump it to $150 for some.
Basically all I’m saying is inflation is BS for companies making up higher prices.
That’s the weirdest comparison you could make. Private teaching isn’t a necessity, even more so music. People aren’t picking between store brand music lessons and locally sourced organic free range lessons of higher quality because budget constraints.
Add to it. People don’t haggle. If you state a price and they’re fine with it? Then you priced it within their expectations.
No we are tired of price gouging by corporations. They’re fucking price fixing.
Yeah it really seemed like the crypto rush is what set all this off, but that can’t be right can it?
No. It was the pandemic and price gouging during the pandemic. The only thing crypto affected was video cards.
Correct. That can’t be right.
This article makes me want to vomit. All these companies and CEOs talking about inflation like it’s this intangible phantom that nobody can get a grasp on.
“If one looks at inflation over time, we very rarely get into periods of sustained deflation. That’s just not a consumer effect,” Coke CEO James Quincey said Feb. 13."
It’s the companies and CEOs price gouging. Call a spade a spade for Christ’s sake.
They’re incapable of sincerity.
Pay board members less. There you go, you now have more money to pay employees.
I’m sorry, I don’t understand.
Perhaps you could try again, in english?
/Executive
The people that represent the shareholders. You know? The fickle group that changes its mind or gives conflicting directions week to week?
Ohhh i know who you’re talking about. No can do buddy. They’ll fire me if I even suggest it. No way I lose this sweet gig.
/CEO
Question for the economists in this thread. Everyone seems to be saying that a lack of at least some inflation is bad but also that wages going up to meet it is bad. Isn’t this a system automatically doomed to fail? Eventually in such a setup no one can afford anything and the economy collapses.
Inflation is fine as long as wages rise with it.
The issue is our economy is entirely built around low interest rates and low inflation. It’s been that way for a generation. This benefit asset-holders like home owners and the wealthy. Hence why they are doing everything possible to avoid wage-growth. They don’t care about inflation, what they are terrified of is wage growth and higher interest rates.
If wages rise together with inflation you get hyper inflation.
No, that’s nonsense. Wages going up are not going to cause 1,000% inflation per year.
I hate to agree with the other guy, but we just saw massive inflation during pandemic because corps refuse to eat ANY loss in profit. It’s all fucking greed.
A big part of that was greed, but not due to rising wages as the poster suggests. Real wages (which means inflation adjusted) did rise sharply in the immediate time after the pandemic recession, but stabilized by 2022.
There were legitimate bottleneck issues that caused some prices to rise. Companies then saw that they had a once in a century opportunity to raise them even more and blame bottlenecks. Despite what a lot of people think, companies can’t raise prices arbitrarily in most circumstances. They’ll just lose customers. This particular situation, though, meant that everyone could do it at once and customers would just have to bear it.
But it will and there’s plenty of precedent, like Weimar Republic.
No, that was because of high volumes of money printing to pay debts.
Yeah, debts to workers.
Are you just making up “facts” as the contradictions flow? Or did someone else make up these “facts” and you just parrot them?
Debts to other countries. Apparently, you don’t know the first thing about how that happened.
That’s not how that works. That’s not at all how that works.
Right… Well, enlighten us all! Maybe you’ll get a prize or something for disproving economists!
Waving your hands around and saying “Wiemar Germany inflation” is the economic equivalent of “Rome fell because feminisim/immigration/too many homosexuals/not enough homosexuals/Christianity/didn’t use Heron’s steam engine/lack of Starbucks”. It’s brought out by people with an agenda and a willingness to twist any historical fact to make things fit that agenda.
Not an economist per se, but what my econ prof in college put on the test is, more or less, that workers’ penury will eventually force them to take action to raise wages. This includes everything from strike actions to workers in general simply refusing to take the lowest-paid jobs anymore. The fact that employers will delay this process as long as possible and keep the raises as small as possible and workers will have to fight like hell to get even pitiful raises is also part of the theory. It’s a story of gIvE aNd tAKe that ignores the government took massive action last year to prevent the labor market from responding to the new market conditions and routinely acts to prevent wages from rising “too fast.” The price of everything can inflate to hell, but if the price of labor goes up in direct response just like every other commodity, whoa now, stop the presses, that’s an economic problem.
Some inflation is necessary to prevent wealth hoarding. It’s one reason we moved away from the gold standard.
Minimum wage needs to be tied to it though because we’re still seeing a huge amount of wealth disparity which is exactly what inflation is meant to solve.
Inflation doesn’t prevent wealth hoarding. In fact it benefits non-cash assets which the rich hoard plenty.
That’s an issue with non-cash assets (like cash was when we moved away from the gold standard). And why Bernie suggested they be taxed heavily.
But the intention of inflation, was to prevent the hoarding caused by the gold standard.
How does reducing the value of cash prevent hoarding of gold (which would be worth more cash then)?
It’s not to prevent hoarding gold, it’s to prevent hoarding money. When tied to the gold standard when gold is worth more, money is worth more, and vice versa. By not selling my gold (or using my money), the gold (and cash) in circulation becomes artificially worth more, as the law of supply and demand dictates. This encourages the hoarding of cash because your money becomes more valuable the less money is in circulation.
The paper standard solves this through yearly inflation and decommodifying money. Commodities are subject to the law of supply and demand. Paper money isn’t and shouldn’t be. When both currency and the things we buy with currency are subject to the law of supply and demand, the system breaks down, essentially.
So, we no longer tie money to commodities. A lesson we learned the hard way, unfortunately.
But then they just hoard real estate.
You’re right, and it’s basically a loophole in the system. It should be fixed.
Inflation is easier to handle and not as bad for the economy as deflation, so that’s where we are always at.
2% inflation and 2.5%-3% wage gains where the difference is made up by productivity gains would be the ideal.
The thing people are scared of is a wage-price spiral where inflation is 10% so wages have to rise 10% which increases employer costs so they raise prices 10% so wages have to rise 10% etc. High inflation that becomes self-perpetuating.
Wages rising faster than inflation is good, but the risk of a wage-price spiral is what people are afraid of with rising wages.
The problem is credit. People and government buying things not with money but credit. Basically IOUs from a parent to a child. In this metaphor it’s like our shitty fucking parents paying home security bills amd groceries with credit cards and using cash for the casinos.
I honestly don’t get it. Why do prices have to go up even if wages don’t? It seems like some people say that some kind of inflation is absolutely necessary no matter what.
Because profit.
They don’t HAVE to go up, but inflation is helpful to the economy and deflation is harmful. With deflation everyone stops spending because their dollar will buy more tomorrow, and that lack of activity hurts the economy.
With a little bit of steady inflation it encourages spending, but wages tend to keep up so it doesn’t actually hurt people.
Also those times when inflation outpaces wage growth are theoretically helpful (in a market that doesn’t have other failures) because if wage growth has stalled that means the value of that labor to the employer has decreased, and inflation helps reset that value calculation without making it a normal thing for companies to reduce your wage at an annual review, think of how hard that would be to budget for.
I really want to know where people got the idea that people would stop spending because their money is supposedly worth 2% more after a year. The only examples I see given are things like economic downturns (i.e. credit freezes and layoffs), where there is deflation because people are spending less for reasons other than deflation. To give an example of deflation not being harmful, just look at technology. Technology gets better and cheaper all the time, but it’s not like nobody is buying technology, quite the opposite in fact.
I’ve read that it’s a debt problem more than anything else. The world runs on credit, and inflation decreases the debt burden. When dollar value goes down thanks to the inflation, the value of the debt also goes down so it becomes easier to pay off (at least for those who do get inflation raises…). So essentially the rich get richer thanks to inflation.
That’s factored into the interest rate of loans. Inflation only decreases the debt burden when inflation increases higher than the average rate AND the one who needs to pay is actually getting more money. What’s the difference between a loan with a 6% interest rate when there’s 2% inflation and a loan with a 2% interest rate when there’s 2% deflation?
It’s nearly impossible for us to maintain the value of money. More is printed every day, much is destroyed at a rate that can’t be tracked, and the economy is fucking complex. Because of all that it will either be in an inflationary or deflationary state at any given moment
Generally speaking inflation is better overall than deflation, so we try to keep a low inflation rate going so it’s not out of control and doesn’t enter deflation
Not an economist at all. I can’t say anything about refusing to raise wages, I don’t know for sure that wages increasing to match inflation is bad for anyone except the capitalist class.
Inflation being more desirable than deflation is simple enough though. If prices are constantly, slowly, going up, it means that your purchasing power with an amount of money is always highest right now as opposed to in the future. This encourages spending - why wait to buy this thing in going to buy anyway, if it’ll be 3% more expensive next year? The one thing we absolutely don’t want is people just hoarding money, sitting on it because prices will go DOWN tomorrow. This leads to a stagnant economy, where there’s no money moving, and that’s bad for everyone.
And yet we have a whole class of people who hoard the most money.
I’ve heard this argument in economics videos, but if you think critically, you can’t wait to buy necessities no matter what way the dollar is moving. And even in an inflationary environment things that you can wait for will go down in price over time. They’ll age, newer versions will come out, a used market starts up for it, etc. So waiting for prices to come down doesn’t seem to be related to inflation at all.
And to give a more concrete example, think of the speed of inflation (assuming 2%/year). Well if we had a year of deflation at 2%, why would I wait an entire year for my $1000 product to be $980. The savings is a pittance.
Most of economics assumes perfectly rational actors capable of making these delayed purchases. It’s a bit reductive for sure, and hard to say how much the real world maps to the theory, but the logic works assuming those caveats.
New challenges for retailers such as:
Not hitting record profits year after year. Reducing their CEO from a five yacht household to a four yacht household. Finding ways to hardline lobby to reduce taxes to zero.
Hah. Like the CEOs will bear any brunt of this burden.
more like, this year the CEO can’t upgrade to a 7-yacht household like planned and will have to be happy with merely upgrading to six yachts, a plane, and two Mazeratis
They tighten their belts, we tighten our belts, everybody loses. All because they got to have all the money and never leave anything on the table for the working class.
Yall made your nut with pandemic price hikes, now eat your fuckin crow.
They won’t. They will continue to cut costs by skipping health and safety requirements and laying off employees. There must always be profit.
There must always be as much profit as possible no matter who suffers*
When’s the last time the US saw significant deflation? The 30’s? Can’t say I blame them for their fear. But they’ll see no sympathy from me! We’ve seen two whole generations born, raised, and passing away in the age of “Number always go up!” business. At least the greatest generation grew up hearing stories of difficult times when it was the unions and collectives that brought them through the darkness. I’m sure current business leadership has no clue how to face this. It’s passed out of living memory.
You can see the massive deflation happening in China right now as youth unemployment hits 25%.
No thanks. We don’t want that over here. Inflation is (and always will be) better than mass unemployment. If you want lower prices, open up our trade with others (IE: Import China’s goods since they’re suffering from deflation: we can benefit from those lower prices).
What are the root causes of that deflation though? I would posit the over extension of the Chinese economy in an effort to mimic “Number go up” results without the required fundamentals (see evergrande).
I see “inflation is good” parroted a lot, without much analysis as to why. I understand how continual inflation is a major driver of modern western economies, and those steering those economies require it to support current polocies and the general status quo. However, that being said, I fail to see how that makes it required for things to be “OK”.
The price of a raspberry “inflates” in the winter, and “deflates” when in season. The price of commodity consumer electronics is in a continual state of deflation, as new teohnology emerges. At the microcosm prices move in both directions frequently, and are just deemed adjustments. Why then, at the macro scale is a continual increase in pricing considered a sign of economic health?
“Inflation is good” from the perspective of Government fiscal policy.
Paying out interest on a AAA-rated loan (e.g. US bonds) is quite cheap, often below the national inflation rate. It allows (in theory) Governments to make large investments - like infrastructure - that work to increase their national GDP, which in turn can lead to increases in their tax-base, making it easier/cheaper to service their loans in the future.
So if the US issues a $1b bond, payable at 10yrs - with inflation at ~3%, the “value” (purchasing power) of that money would have decreased by over 25%.
No thank you, we do not need China dumping their goods in our markets. Just look at the EV dumping going on in the EU.
Decoupling is why you see massive deflation and unemployment in China and part of the reason why you don’t see it in the USA. Opening our markets to them would doom many of our industries and drive up unemployment for our youth.
I thought the US loved free trade? Oh, only when it benefits the corporate masters, I see.
No, the US does not love free trade. The current global economic environment where anyone can trade anywhere was established during the twilight of WW2 during a meeting at Bretton Woods.
Historically Imperial powers would occupy the vanquished, dismantle their adversaries economic systems and make them vassal states. They would then close their systems to outside trade and reap the rewards.
There were two problems with that for the US, first it would take a large military to do this (and we did not want to field those armies long term), second it meant we would probably have to fight the Russians directly as they would want to become an imperial occupying force (which they did) and would probably try to compete with us (which they did).
Instead we decided to bribe the Europeans into fighting the Russians for us. Hence the current global order where anyone, can trade anywhere for anything. We backstopped freedom of the seas with our fleet. Opened our markets to trade and provide financial assistance to help rebuild Europe. In exchange the European powers subjected their foreign policy to us and agreed to fight the Russians.
Europe, Japan and the rest of the Western world embraced this new economic system and it became foundational to their economies. To the US this was just a security deal, yeah we opened our economy but we never fully invested our economy in it. Which is why you don’t see many regional free trade deals passed beyond NAFTA after the end of the Cold War. We prefer to negotiate bilaterally with individual nations. We rarely ever open our markets without major concessions from the other side. We are also becoming more and more insular and are slowly pulling away from the global order we created because for us it was always just a security pact and we really don’t need it in a post Russian/USSR world. There is no popular support for NATO or any of the other institutions we created. Trump is a brainless Russian meat puppet but he knows how to read a room and the US electorate aren’t enthusiastic about staying connected to the rest of the world and subsidizing the costs maintained the current order.
Profits must always go up.
Guillotine’s can also go up.
I like it best when they come down.
The spice must flow
Blood for the blood god!
Fuck retailers. Have less shareholder profit and get over it. They want profit to be fixed or increasing. They view it in an accounting sense as something they cannot have decrease, ever. This is unrealistic and makes them do stupid things.
There is no sin greater in capitalism than uncaptured profit, none.
Fuck capitalism and the barbaric world it creates. We are better than this but the sociopaths like to count big numbers.
Only stupid to those not benefitting from it. Like most of us.
I thrift pretty hard now.
Even thrifting is expensive now. The truth is, there’s nowhere to cut and that’s why it’s hurting so many people.
The hell? Where are you thirfting? The Goodwills near me sell clothes for less than $3 per garment. Toys are less than $5. Movies are a dollar, games are $5 per title, what state are you in?
Chickpeas, soyflakes, rice, hemp & chia seeds, quinoa, tofu, lentils, flour. Most of the dried goods have a shelf life of 1-2 years. The cost of them is sinking in germany. I’m fine with people complaining about rising cost of meat, eggs and dairy and ignoring that fine sources of protein, minerals and vitamins. More for me.
Do lentils have much taste?
They’re like beans.
While having them home cooked is better, try some prepackaged Indian or Middle Eastern foods that might have them from a local health food store. Regular grocery stores might have them in some canned soups.
I’m personally not a fan of lentils, I find them somewhat dry/mealy in consistency, but I’m not going to turn down a good dish with them in it.
I honestly have never had beans. The only vegetable I’m good with is hummus, but I’m super curious about vegan/vegetarian proteins. I won’t start with lentils, though. Sounds unpleasant for someone with texture issues. Thank you.
Hummus is made with beans.
My brother in christ, it’s garlic and chickpeas. I’m choosing not to call them garbanzo beans but specifically peas. Tho, yes, but it’s all blended and shit.
Peas and beans are both legumes and there’s no reason to separate them biologically into two types the way we do it.
Protein is made up of about 20 amino acids. Your body can produce 11 of them itself. You need to ingest 9 of them, the so called essential amino acids.
Meat usually contains the complete protein, as well as soy (tofu, edamame, tvp) does. But there are others like quinoa or hemp seeds.
Other plant based protein sources like legumes, beans, peas, grains, seeds & nuts need to be combined to get the 9 EAA because they all are a bit deficient in mostly one amino acid (but they too contain all of them). That’s why beans and rice are often eaten together:
https://www.piedmont.org/living-real-change/what-is-a-complete-protein
I would look into tofu and TVP (textured vegetable protein). The latter is made up of soy but comes in the form of crumbs of varying sizes. It’s dirt cheap here and high protein. If you get the finer grained, you can process them into stuff that resembles ground meat. You can make bolognese, casseroles or burger-patties (in combination with a binding agent like aquafaba or linseeds, onions, mushroom) out of it.
If you don’t want to cook you could make shakes with a food processor or smothie mixer. Plantbased protein powder (pea/rice/soy) + fruits, seeds cocosmilk etc.
I’d install the app cronometer and get a kitchen scale if you don’t have it.
Cronometer contains a gigantic database of products you can easily enter by scanning the barcode. The database is contributed to by users. I can tell they seem to be strict with the quality-control of the contributed products. I contributed one 3 weeks ago and it’s still not in the DB although I looked at pretty in depth websites for the micro nutrients and triple checked the units and numbers.
So you enter your body data and it tells you what your goals are. You can set individual targets, e.g. protein according to your level of activity. You can track workouts too which then modify your macro goals accordingly. You can enter the ingredients of a recipe, save it and restore it when you cook it again. I made myself one e.g. for morning cereals which let me meet my overall daily protein and overall target of 30-40% already. With a daily report it tells you down to the individual vitamins, minerals, fatty acids and amino acids what you need. All in the free version.
What you need to do yourself is to find out what micro and macro nutrient is in what product. Cronometer gives you hints if you click on them in the daily report. You don’t need to track forever as it’s sure cumbersome but to get a feeling for proper nutrition it’s an eyeopener.
In forgot vital wheat gluten alias seitan which a bite of would probably obliterate a gluten sensitive person. It’s often used in convenience food.
It’s made out of flour and nothing much else and it happens to have the highest amount protein per gram among the plant based products and even higher than some meat products. The problem is the amino acid profile:
Most of the listed foods don’t have much taste on its own. And nobody should eat them unprepared. RememberTheApollo_ described it well. But spices are a thing. With them you can transform them into culinary experiences.
Combine chickpeas with cumin, lemon juice, olive oil, tahini/peanut butter and garlic: delicious nurturing Hummus.
Combine chickpeas with parsley, onion, garlic, cumin, coriander, pepper and sesame seeds: mouth watering falafel.
Combine tomatopaste, oliveoil and spices to get a nice base for frying crumbled tofu (a complete protein) to emulate ground meat.
With all the dried food it’s important to prepare them correctly (rinse, soak, cook) to get rid of plant toxins like phasin, solanin, oxalates or arsenic.
E.g. a study found out the best way to prepare natural rice. Peeled rice doesn’t contain much arsenic but natural/brown rice may contain it in its shell (amounts vary by its country of origin).
Not really, but that can be a positive if you know how to spice food properly. I make a lentil taco recipe in the instant pot and it comes out pretty good as long as I don’t forget any of my spices.
Retailers fear things that would help consumers consume? Sounds like retailers don’t know how to succeed without gouging.
The last time USA had extended deflation, the Great Depression happened. When people stop consuming, retailers fire their workers. Then fewer people can consume, so more people get fired. This goes on enough, then its not just stores who fire workers, but it trickles to factories, R&D, office workers, etc. etc. The longer deflation happens, the further it spreads and the more people lose their jobs.
Ever since the Great Depression happened, US Policy has been strongly anti-deflation. Our policy is to “err” on the side of slight inflation.
So what happens when retail workers don’t get paid enough to consume even with jobs?
Prices drop, causing more people to get fired. IE: The Great Depression. Or if you want a modern economy that’s undergoing this shift, just look at China right now.
If people can’t afford things, your only choice is to fire workers and drop prices further. That’s just economics. (Why do you need workers? No one is buying anything, so fire your workers. Duh). The more people realize that this is the only strategy to survive, the lower prices get, the more people get fired, and the less that people can consume. It gets worse and worse until economists change policy and pull you out of this.
This is why we have large pseudo-government central banks keeping watch over our economy. Deflation cannot be tolerated. Yes, inflation sucks, but at least people still have jobs and livelyhoods in times of inflation or hyperinflation even. That’s actually survivable. Deflation is NOT survivable, it sucks so much worse. Deflation is all-hands-on-deck we need to work together kind of situation. We never want to push the economy to that direction.
China isn’t doomed btw. China’s plan is to exports goods to Europe and hope that Europe buys enough Chinese crap that they can kickstart demand again. And as prices drop further and further, Chinese goods will get cheaper, and crap like Temu will pop up to sell these cheaper goods to everyone. Now there’s geopolitical repercussions to this (not everyone will want to support such “dumping” of goods into our countries), so there’s no guarantee that China will be successful on this front.
We have a collapsing climate, and no plan B, but yeah, this is what we should be focusing on right now…
Only when a person stops worrying about tomorrow can they worry about next week.
