Inflation from Money Printing, Survival, or Greed?

[Scataphagos]

We really need something new socially too instead of meeting to eat over priced food because there is no other real options besides meeting to drink over priced coffee.

Maybe "invite folks over for dinner" instead of all that dining out. In my house, we used to go out for dinner a couple of times a week. Now, couple of times a YEAR! Besides the cost saving, likely to eat better food at home than in a restaurant. (I get it... eating at home all the time is kind of boring... trade-off vs. high cost... we can afford to blow $200 on restaurant dinner but choose not to... instead we'll buy prime cut steaks at Costco a time or two per month.. and the quality is good.)

 

[unconventional wisdom]

hotels have increased their prices and i don't believe there has been such an increase in demand that they are fully-booked. a room that used to go for $150/night is now $220, and if i want the quiet side of the hotel (which used to be free if i asked), now has a $10 surcharge.

 

[lightninboy]

Inflation must be from money printing because I for one would never be greedy.

 

[murray t turtle]

%%
$39 for ribs\ that must be for inflated pork
T bones beefsteak , all over the map in price but less than $10@ cash grocery mostly.
One lady said she made home made lentil soup;
even the higher priced store organic soup beats inflated porky ribs

 

[unconventional wisdom]

https://portside.org/2022-04-24/cor...ortionately-inflation-how-should-policymakers

Corporate Profits Have Contributed Disproportionately to Inflation. How Should Policymakers Respond?

 

[ElCubano]

Tips- that went through the roof.

 

[2rosy]

I would call it price resetting. Businesses held off on price increases until they couldn't. For price gouging, isn't that only possible for monopolies or oligopolies

 

[M.W.]

Starbucks, Grande Coffee here $2.10, that's $1.53 USD. What you mentioned is clearly price gauging. (https://costfindercanada.com/starbucks-menu-prices-in-canada/)

What I noticed on Amazon is that many items not only sell at inflated prices, oftentimes far exceeding inflation rates, but I can hardly find single unit items anymore even of products where you truly just need a single unit anymore. When in the past a small item cost 5 or 6 dollars the same product is now offered at $30 dollars or so for 4 identical units of the same product. To me this is price gauging because as consumer I am not able to just order a single unit anymore, so I essentially would need to pay $30 just to get my hands on the product of which I only need one single unit.

Next, fuel prices, we still pay over $2 per liter (over $10 per gallon) in the BC Northwest (Canada), even though all supplying refineries in the North West US have come back from scheduled maintenance and prices in the lower mainland already dropped over 30 cents, it takes generally 1 or 2 days for gasoline to be shipped up and gas stations here get new supplies twice a week.

Flights that cost 70-100 dollars to Vancouver one way are charged an inflated 300-400 dollars (one way) for no apparent reason. The flights are neither booked out nor is a fuel surcharge built into stated price.

Another fun one, ice cream and frozen yoghurt at 6 or 7 dollars for a single scoop (ouch)

Also, NVIDIA, despite promising to put in policies to allocate new GPUs to those with prior NVIDIA GPU ownership are getting none, current prices are at almost 100% premium to MSRP, caused by flippers, something NVIDIA promised to address but has not.

Finally, lumber futures prices are back to 535, slightly higher than long-term averages (down from 1700). Yet timber at local sawmills and builders is still priced exactly at levels when lumber traded at 1700.

I posted some of the post below as a reply in another thread but I figured the topic might make a decent thread of its own, which is... Where have you noticed price increases that feel more like price gouging than just inflation caused by the standard money printing or supply chain excuses?

For me, it does feel like certain things are prohibitively more expensive than they used to be just out of greed, or perhaps trying to dig out of the Covid hole? I don't know.

Example... My wife and I went out to lunch the other day at a restaurant that's built right into the side of a local mall. And it's one of those places that serves a little bit of everything, and it wasn't busy at all like I remembered it to be in years past, so we're not talking about a situation where there are just so many more customers waiting around to be seated than there are seats to fill. When I saw the prices on the menu I was like WTF is going on? Examples:

Bacon Cheeseburger - $23
Crab Cake Appetizer - $25
9oz sirloin - $36
BBQ Ribs - $39
Sea Bass - $50
8oz Filet - $55

And even a side order of fries was $8. I mean, the whole experience felt like the biggest ripoff ever. We're not talking about Morton's steakhouse here. It's a mall restaurant for crying out loud.

Another massive ripoff I've noticed recently has been coffee shops. That same day my wife and I went out to lunch, we took a quick stroll around the adjacent mall afterwards. I haven't stepped foot in that place in about 4 years, and it was a total ghost town. As we were walking around, I stopped in Starbucks and got a large cold brew coffee... black. No sugar. No creme. No fancy latte bullshit or anything like that. The cost: $6.48.

Fast forward a few weeks later. I'm on the Gulf Coast of Florida at a Marriott hotel and they have a full-blown coffee shop and breakfast area beside the lobby. I order my usual large cold brew and lo and behold we set a new record. Grand total with tax: $8.00

Eight... friggin'... dollars... for a black coffee.

I work from home so 99% of the time I'm making my own coffee, cooking my own meals, etc, so I'm oblivious to what's going on in the outside world. So yeah, maybe it's just me living under a rock for so long that's the issue. Not sure.

Have you noticed that pricing just seems to be out of control in your area? If so, give an example.

 

[M.W.]

That is why I appreciate rent controls, even though I am a property owner and live in my own four walls. In BC, Canada, there are rent controls in place that limit rent increases to not exceed a published inflation basket that is very well defined.

(https://www2.gov.bc.ca/gov/content/...ial-tenancies/during-a-tenancy/rent-increases)

In my opinion, even in market economies that follow a capitalist market model, essential services should be highly regulated in order to prevent price gauging. Education cost is an obvious total disaster and miss, rent in many other jurisdictions as well. Medical care is another issue that has priced out many ordinary citizens because it has not been sufficiently regulated. Ironically, the same people who get extremely angry about any intrusion into free choices of corporates to set prices are now screaming the loudest about inflation.

The inflation that's causing the most pain for people is rent and that has some serious price gouging IMO.
I've owned rental properties the past 10 years. In the past couple years the rental prices have gone up MUCH more than landlord costs. IMO this was partially triggered by the government when they provided billions to renters that couldn't afford the rent. Landlords increased rents as they knew they could get the government to pay for any troubled renters. Increased housing valuations also played a part in rental increases.

 

[M.W.]

Imo, the biggest contributor to the misallocation of resources that will go into the history books is the cheap money that floated around for almost 1.5 decades plus the magnification and elevation of a few success stories in entrepreneurism through social media.

People figured out that they can start a business overnight and charge whatever they want, all completely debt financed, even without much apparent talent to operate successfully long-term. Humans often go through life by seeking the path of least resistance that requires the least effort. There is a huge shortage of medical practitioners (including nurses), elderly care takers, engineers,...all professions that either require very long training plus passing licensing exams or professions that do not pay extraordinarily well despite their huge importance and contribution to the wellbeing of society. Most young folks seek the quick buck of role models on social media, rarely do those influencers talk about the down-side of their chosen life styles.

These restaurants are probably in a death spiral. So many should have failed during the pandemic but we floated all of them and now their only chance is raising menu prices. There isn't nearly enough labor to work in all these restaurants. If 50% of restaurants closed here there would still be too many options.

The last 10 years I think so many young cooks were convinced to open restaurants from constantly reading about entrepreneurship. Now such a huge percentage of these restaurants are just unprofitable debt financed zombie businesses without even close to enough labor to go around so they have to pay such inflated wages. Half the people should probably be employees at their competition's restaurant instead of driving up wages for both as they all burn through debt advances.

It is really a good example of the degree of excess and dislocation we have to work off right now to start the next business cycle.

We really need something new socially too instead of meeting to eat over priced food because there is no other real options besides meeting to drink over priced coffee.