Is there such a thing in economics as "pent-up inflation"?
As in, the economy keeps rolling along with "shrinkflation"-like phenomena absorbing as much of the increase in inputs as possible, until it passes a tipping point (in this case propelled by Covid-related adjustments) and all of a sudden prices shoot up.
It would be interesting to see if there's any literature on this phenomenon.
I wish I knew if there was any lit on this, but I think the same way. When the cost to own a given size house is double the cost to rent that house (in some VHCOL places like Seattle that is true at the moment), eventually people are just gonna opt out and rent.
Anecdotally, I've basically opted out of any sort of food that I don't prepare myself. Although not immune, Costco has avoided the same level of inflation as other grocery stores and especially restaurants, so I just shop there and save money because the prices for prepared food has just gone through the roof.
By shopping weekly ads and couponing, and being more willing to make meals from whatever is on sale (I made my first ever pot roast last week, and it was divine) -- I've cut my food budget by 50%. Granted, I wasn't being that selective before: I used to buy things like $8.99/lb 'air chilled' chicken breasts, and now I'm buying $1.99/lb value packs. I get no complaints at the dinner table, so I'm unsure what I was paying for before. Between that and limiting meals out, I'm saving more than I thought I would.
Grocery stores are beginning to level-up their "price optimization" strategies (car insurance companies have been doing it for much longer [0]): people who work for it pay less. A box of cereal is $3.99 on the shelf; with club card and digital coupon it's $1.99. That's one item down 50%. You scale that methodology to your entire shopping trip, and your dollars go way further.
I have gotten used to just not eating meat every day. I am not refraining out of ethical or health reasons, I'm just happy with tomato sauce on my spaghetti, for instance.
I've noticed that potatoes are really cheap, relatively, like under 50 cents a lb. It has assuaged my unhappiness at pasta being over $1/lb which is my mental anchor.
I do use the loyalty card and look for the things that are on sale by the largest amount, but I don't bother with coupons, because all I see are for things I don't want.
Pasta a little more than doubles in weight when cooked so potatoes are probably more expensive than pasta, which is usually more than rice which triples in weight when cooked.
Of course nutrition is a different matter, making potatoes or brown rice better choices than in a simple weight calculation.
Mostly unrelated, but few years ago I realized that buying the $3/box pasta has a trivial impact to my food budget but it really does taste better and soak up sauce better (due to the slower extrusion process)
Depending on how you plan on cooking the chicken, air chilled would have no discernible difference. For example if you're making say pulled chicken sandwiches, you're cooking the chicken in a vat of water....
https://www.thekitchn.com/whats-the-deal-with-air-chilled-ch...
I did this a lot for the last few years, but I just have seen those kind of deals for a few months now. At the very least, they are a lot less common than they used to be. That store brand cereal that used to go on sale for $1.99 is going on sale for $3 instead, but that’s if they are able to stock it at all (so I’m often paying full price and I’m just happy they have it).
Where I live it is $2000+ to rent a 1 bedroom apartment, which is about the same as the mortgage on a 4000 sq foot home on an acre that we purchased this past summer. I’ve been thinking that everyone that can will start buying since rent prices are crazy high.
Do you live in a tech hub / city? I'm living in a "rent cheaper than owning" tech city and it just seems like homes are being snapped up by DINK couples (both working in tech) who want to build a real estate portfolio. Hard as a single person trying to just get into a starter home :/
That was probably closer to the real price if your lunch.
We’ve had a glut of restaurants all up and down the “star level” here in Madison, WI. I think that is true in many cities.
When you account for real wages and costs, many of those places shouldn’t and wont survive over the next few years. We don’t need 6 dollar burritos delivered for 15, and we don’t need five places found farm to table for 30 bucks a plate. If that means service and cooks and dishwashers have to work three jobs in that world, to hell with it.
There's a vast gulf between a soup kitchen somewhere cheap and a sit-down restaurant in the middle of the city with high quality but high rents and high wages.
McDonalds is still going to exist and be cheap enough to eat at a lot.
Hole in the walls, with relatively cheap rents and family owned with takeout and streamlined overhead will also still exist.
Eating out is strangely expensive in most places in the US, compared to many parts of Asia at least. I'm not sure why. I considered density as a factor but if anything cities cost more in the US.
>Eating out is strangely expensive in most places in the US, compared to many parts of Asia at least. I'm not sure why. I considered density as a factor but if anything cities cost more in the US.
The same reason everything is more expensive in the US; overhead and wages. The economics of running a family restaurant in a building you've owned for generations is completely different than that of a corporate fast casual place that pays wages and rent.
I don’t think this is the case at all. Specialization provides tremendous value, and making things in bulk is far more environmentally friendly than everyone making things individually.
Has Madison seen an increase in restaurants compared to a couple years ago? I've only been here a year but in the last place I lived, almost everything seemed to shut down during COVID but as things eased up new places opened up to about 120% of the old capacity - the end result being everything seemed to have reduced hours because they couldn't get enough business to get enough staff. From what I've heard from friends it hasn't gotten any better. Plenty of restaurants but a lot of them are only open 2-3 days a week so you end up with servers et. al. having 2-3 part time jobs.
They're saying that it's pretty silly to compare buying ice cream to being mugged. If it's too expensive, don't buy the ice cream. The price of ice cream isn't an invariant, if nobody buys it the price will decrease. If nobody has a problem paying $5/scoop for ice cream, that's what the price is going to be.
There's nothing silly about it. It's just a metaphor. It's more incredulous that people have a problem with figurative speech like this than the comparison itself.
Sometimes prices are inelastic after you've stood in line wanting ice cream. You have to price in human emotion. Next time he'll probably find a cheaper place.
Seeing the same things here, lunch is $25+ a person at casual sit down places. Some have even done away with lunch menus so you’re left with lunch portions for dinner prices.
prices for some food items have definitely doubled and restaurant sure haven't been shy about raising prices. My favorite chinese place has gone up 70% in a year. So much that I only go there once a month tops.
As in, the economy keeps rolling along with "shrinkflation"-like phenomena absorbing as much of the increase in inputs as possible, until it passes a tipping point (in this case propelled by Covid-related adjustments) and all of a sudden prices shoot up.
It would be interesting to see if there's any literature on this phenomenon.