Inflation (Again)
Feb. 17th, 2022 02:59 pm![[personal profile]](https://www.dreamwidth.org/img/silk/identity/user.png){kind=small}
canyonwalkerInflation has been in the news lately... again. I say "again" because it popped up as a news item about 4 months ago when Social Security announced a benefits increase of 5.9% after the Department of Labor announced a 5.4% increase in the consumer price index (CPI) over the previous 12 months. Since then I'm not sure inflation actually ever went away as a news item. It certainly hasn't gone away as a fact of life most consumers are noticing every day.
If anything inflation has gotten worse in the past few months. News from last week showed the CPI increased 7.5% in January versus one year earlier (CNN article, 10 Feb 2022). This has led to a lot of wailing, gnashing of teeth, and political finger-point for blame, as the 7.5% annual inflation rate is higher than the US has measured in 40 years.
There are a lot of things I could say about this, ranging from my recollection of what high inflation in the 70s and early 80s was like (I was a kid at the time but remember the high rates), to my opinion about what's causing this spike, to how long I think it will last, to what its impacts are on consumers. For now I'm just going to talk about the latter, impacts on consumers; particularly first-hand impacts.
As I wrote back in October, inflation isn't hitting me too hard. Yet. My biggest monthly expenses, the mortgage and a car payment, are fixed. The costs of other things are going up, but fortunately they're not a huge part of my budget. That said, the way prices of everyday items are going up is noticeable.
I've observed these grocery items getting more expensive over the past 12 months:
It's interesting how these increases I'm seeing in basic grocery items are way higher than the CPI figure. That's one common criticism of the CPI— that it understates the amount of inflation on basic necessities and thus underestimates the impact of inflation on poorer people who spent a large fraction of their income on such things.
If anything inflation has gotten worse in the past few months. News from last week showed the CPI increased 7.5% in January versus one year earlier (CNN article, 10 Feb 2022). This has led to a lot of wailing, gnashing of teeth, and political finger-point for blame, as the 7.5% annual inflation rate is higher than the US has measured in 40 years.
There are a lot of things I could say about this, ranging from my recollection of what high inflation in the 70s and early 80s was like (I was a kid at the time but remember the high rates), to my opinion about what's causing this spike, to how long I think it will last, to what its impacts are on consumers. For now I'm just going to talk about the latter, impacts on consumers; particularly first-hand impacts.
As I wrote back in October, inflation isn't hitting me too hard. Yet. My biggest monthly expenses, the mortgage and a car payment, are fixed. The costs of other things are going up, but fortunately they're not a huge part of my budget. That said, the way prices of everyday items are going up is noticeable.
I've observed these grocery items getting more expensive over the past 12 months:
- Chicken, up 50%
- Steak, up 30-40%
- Ground beef, up 10-20%
- Cheese, up 20%
- Sodas, up 15-20%
It's interesting how these increases I'm seeing in basic grocery items are way higher than the CPI figure. That's one common criticism of the CPI— that it understates the amount of inflation on basic necessities and thus underestimates the impact of inflation on poorer people who spent a large fraction of their income on such things.
no subject
Date: 2022-02-18 08:43 am (UTC)no subject
Date: 2022-02-18 11:46 pm (UTC)When we visited Honolulu in December and shopped groceries (part of minimizing the need to eat out during the pandemic) we found the costs on most items noticeably higher than in California. For example, sodas (supermarket packages, not singles) were almost 2x the price.