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> prices aren't going to readjust back down That would be deflation. Inflation of 10% means something that was $100 goes to $110, if inflation goes back to 1%

> prices aren't going to readjust back down That would be deflation. Inflation of 10% means something that was $100 goes to $110, if inflation goes back to 1% for the next year that $100 thing will be $111.10 next year. It always goes up ... and it compounds.

paxys 3y ago
Yeah I have no idea why people can't grasp this simple concept. Inflation could be 0% for the next decade and consumer prices still wouldn't go back to what they were in 2019. The only way to stay ahead is to ignore the absolute price of things and instead make sure your salary and investments are increasing at a higher rate than whatever the CPI number is.
- blitzar 3y ago
  As I wrote my comment in my head "dont be a condescending prat, people know this" circulating with "no they dont".
cwkoss 3y ago
I'm not talking about the supply chain costs of goods rising - from my view - corporations used inflation as cover to increase their profit margins and they are continuing to hold these high margins instead of going back to the competitive business as usual that we previously had. A costco sized bag of potato chips is now $11. Systemic economic factors only account for a fraction of that price hike in my appraisal. The idea that them dropping their price to a more reasonable $7 would be 'deflation' is overapplying economic theory terms. Pruning branches on one tree isn't deforestation. I feel like there is a certain breed of capitalist who took econ 101 and is deluded into thinking any backpressure of corporate greed is risking a 'deflationary spiral'.
- ProfessorLayton 3y ago
  Businesses don't price their goods and services arbitrarily, they do so based on supply and demand. Let's put greed and supply chain disruptions aside for a second: The reason bags of potato chips cost $11 now is because someone is still buying them at that price. It would not make sense to drop the price to $7 if they're selling out at $11, business just doesn't work that way, and frankly neither do people. Would you offer to take a lower salary despite being offered more?
- blitzar 3y ago
  [flagged]

paxys 3y ago

Yeah I have no idea why people can't grasp this simple concept. Inflation could be 0% for the next decade and consumer prices still wouldn't go back to what they were in 2019. The only way to stay ahead is to ignore the absolute price of things and instead make sure your salary and investments are increasing at a higher rate than whatever the CPI number is.

blitzar 3y ago
As I wrote my comment in my head "dont be a condescending prat, people know this" circulating with "no they dont".

cwkoss 3y ago

I'm not talking about the supply chain costs of goods rising - from my view - corporations used inflation as cover to increase their profit margins and they are continuing to hold these high margins instead of going back to the competitive business as usual that we previously had. A costco sized bag of potato chips is now $11. Systemic economic factors only account for a fraction of that price hike in my appraisal. The idea that them dropping their price to a more reasonable $7 would be 'deflation' is overapplying economic theory terms. Pruning branches on one tree isn't deforestation. I feel like there is a certain breed of capitalist who took econ 101 and is deluded into thinking any backpressure of corporate greed is risking a 'deflationary spiral'.

ProfessorLayton 3y ago
Businesses don't price their goods and services arbitrarily, they do so based on supply and demand. Let's put greed and supply chain disruptions aside for a second: The reason bags of potato chips cost $11 now is because someone is still buying them at that price. It would not make sense to drop the price to $7 if they're selling out at $11, business just doesn't work that way, and frankly neither do people. Would you offer to take a lower salary despite being offered more?
blitzar 3y ago
[flagged]