How is Inflation Affecting Your Daily Expenses?

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In summary, prices are going up faster than normal. There is no excuse for companies not to be raising prices to cover rising costs, especially when there is a pandemic.
  • #106
I give up. I'm not going out anymore (it's a Friday night too)...

We're close to $5 gas here.
 
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  • #107
kyphysics said:
I give up. I'm not going out anymore (it's a Friday night too)...

We're close to $5 gas here.
The government is going to have to figure out how much inflation is real and how much price gouging is going on because businesses and people think they can get away with it. My AC guy charged $60 last year for the AC summer checkout. This year it was $180 for the same work. He did this in two steps. First he upped his price from $60 per hour to $90 then he separated out the coil washing which previously was included and now is extra labor for another $90. I called him and pointed out inflation was 8.5% not 200% but he just said that's what they decided to do because gas was $5 a gallon.
 
  • #108
I do not see that there is any distinction to be made between "real" inflation and "price gouging". If the buyer and seller exchange goods or services for a price then the price is what it is.

In any case, it is (in my opinion) none of the government's business how much you are willing to pay for an AC checkup and how much your AC guy is asking for it. That's what an efficient marketplace is for. Government intervention (e.g. wage and price controls) tends to make the marketplace less efficient than it would otherwise be.
 
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  • #109
jbriggs444 said:
I do not see that there is any distinction to be made between "real" inflation and "price gouging". If the buyer and seller exchange goods or services for a price then the price is what it is.

In any case, it is (in my opinion) none of the government's business how much you are willing to pay for an AC checkup and how much your AC guy is asking for it. That's what an efficient marketplace is for. Government intervention (e.g. wage and price controls) tends to make the marketplace less efficient than it would otherwise be.
I hired them because I knew what the price was except they failed to mention they tripled it.
 
  • #110
jbriggs444 said:
If the buyer and seller exchange goods or services for a price then the price is what it is.
And if an external agency steps in and says "no, you can't charge that much" then you get shortages.
 
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  • #111
Vanadium 50 said:
And if an external agency steps in and says "no, you can't charge that much" then you get shortages.
I'm not suggesting strict price controls. I only suggested greed may be inflating some things more than the market demands. If it spirals out of control things could get real bad.
 
  • #112
bob012345 said:
I'm not suggesting strict price controls. I only suggested greed may be inflating some things more than the market demands. If it spirals out of control things could get real bad.
Certainly, unintentional agreement to a transaction at a higher price than the buyer was actually willing to pay is a sign of an inefficient market. The vendor may be playing fast and loose with some consumer protection rules. But the market is able to deal with this -- you shop for another vendor or do without.
 
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  • #113
jbriggs444 said:
you shop for another vendor
If it costs $60 to make a widget, and someone is "gouging" by charging $100, I have the opportunity to undercut him by charging $90. And you have an opportunity to undercut me by charging $80. And so on.

Fundamentally, we had two years of reduced production, and now there is increased competition for tbose goods and services. So prices rise. Additionally, governments have been funding these two years by printing money, so the value of each florin or guilder has fallen. Prices again rise. This shouldn't be a shock to anyone - we have inflation because we decided to have inflation.
 
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  • #114
https://www.cnbc.com/2022/06/10/consumer-price-index-may-2022.html
  • The consumer price index rose 8.6% in May from a year ago, the highest increase since December 1981. Core inflation excluding food and energy rose 6%. Both were higher than expected.
  • Surging food, gas and energy prices all contributed to the gain, with fuel oil up 106.7% over the past year.
  • The rise in inflation meant workers lost more ground in May, with real wages declining 0.6% from April and 3% on a 12-month basis.
Core CPI (which is ex-energy and food, b/c they are volatile) doesn't reflect the lives of every day Americans. People got to drive and cool/warm their cars/houses and eat you know.
 
  • #115
Vanadium 50 said:
If it costs $60 to make a widget, and someone is "gouging" by charging $100, I have the opportunity to undercut him by charging $90. And you have an opportunity to undercut me by charging $80. And so on.
This assumes an efficient market where one has the time and ability to shop around. That is not always the case.
 
  • #116
bob012345 said:
This assumes an efficient market where one has the time and ability to shop around. That is not always the case.

An efficient market includes the effort to find service/goods providers. If you don't have time to shop around it means the cost of the product is low enough you don't care, or the cost of connecting a provider with a customer is so large that the value you get from just knowing current provider exists is enormous.
 
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  • #117
There's a certain degree of segmented inflation.

People definitely experience it differently. Housing/shelter is 1/3 of CPI.

Yet, renters face far more inflationary pressure vs. homeowners with a paid down (or close to paid down) mortgage. That homeowner has an appreciating asset with potentially zero debt on it (even after factoring in property taxes, maintenance, etc.), whereas the renter is getting crushed with 20% or so rental inflation. A wealthy person can buy in bulk when there is a sale much easier than a low-income person, who may live in a food/grocery desert, lives paycheck-to-paycheck, and cannot afford the gas to go from the poor part of town to a Costco (if that would even help them), etc.. . .
 
  • #118
Office_Shredder said:
An efficient market includes the effort to find service/goods providers. If you don't have time to shop around it means the cost of the product is low enough you don't care, or the cost of connecting a provider with a customer is so large that the value you get from just knowing current provider exists is enormous.
I'm no economist but the above just sounds like you are rationalizing people's actions to fit the model. I can say the above rationalization does not always fit my situation.
 
  • #119


So, we should buy hard liquor and avoid chicken?
 
  • #120
Thread closed for Moderation...
 
  • #121
kyphysics said:


So, we should buy hard liquor and avoid chicken?

Sounds like good advice. After further Mentor review, this thread will stay closed for now. Thanks all for the interesting thread.
 

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