12 ms·

Why are Americans frustrated with the economy? The answer lies in grocery bills

37 points by DocFeind 3y ago

jdksmdbtbdnmsm 3y ago
>— an economy that the professionals say is doing pretty well The so-called "professionals" are simply useless, and guess what...people are figuring that out too.
- Mountain_Skies 3y ago
  Wonder if they're the same professionals whose numbers keep getting quietly revised in a worse direction a few months after the initial rosy numbers are released.
- ozim 3y ago
  There is a lot of BS in finance, but throwing blanket statements is something I don’t like. Just like the fact that I can go to grocery store and get dozens variations of food is because of “professionals”. Financial services help build up farmers sustainability and help new companies build supply chains. Lots of nice things we can enjoy in first world countries would not happen if there would not be people making sure that money can move around.
  - ithkuil 3y ago
    This sentiment taps in a generic meme that has infected society of late. Starting from the fact that many professionals made many mistakes over time, the meme trips you into concluding that if there were no people in that category of "professionals" , then these mistakes wouldn't be made and somehow society would just work "correctly" if it wasn't for those pesky "professionals". This meme builds on a time-honored meme that comes in vary forms such as "a member of that other ethnic group committed this crime; if we only got rid of all members of that ethnic group then those crimes wouldn't happen"
    - tanseydavid 3y ago
      IMHO you're overthinking it. It is as simple as a mismatch in situational awareness. An expert considering the macro side of an economy with 330 million people in it cannot meaningfully tell any one individual that things are good/ok if that individual's situation is growing noticeably worse with the same earnings. No memes are required.
      - ithkuil 3y ago
        That explains why there is a perception that experts are disconnected from the reality. But that doesn't explain how people can think they can just trash all expertise and think the good parts of the world will keep working just fine.
  - TheOtherHobbes 3y ago
    There are plenty of people in the US who can't afford to go to the grocery store at all. https://gitnux.org/food-bank-statistics/ https://gitnux.org/food-bank-statistics/
- Ekaros 3y ago
  Or has the economy come to mean that most of stock market is going up... And as long as that continues everything is great and it really should be only goal of any policy...
  - TheOtherHobbes 3y ago
    I find it informative and revealing to replace "the economy" with "what rich people want." Because that's pretty much what it means in practice.
  - gmerc 3y ago
    and while tech was a growth industry nobody cared. For most blue collar workers “the economy is red hot” during the tech booms also sounded like bullshit. Echo chamber.
- graemep 3y ago
  The problem is a matter of point of view. What constitutes the economy "doing well" is subjective. If you are looking at a measure like GDP it includes a number of things such as wages and profits. If wages fall but businesses increase profits by more the economy is "doing well" on that metric. There has been a recent example of that in the UK, where a number of politicians and professionals (central bankers, economists) have said an important objective is to reduce wage inflation. If you are someone who is paid wages (especially if you real terms wages have been reduced by price inflation) you are quite likely not think this is a desirable objective.
  - tonyedgecombe 3y ago
    >There has been a recent example of that in the UK, where a number of politicians and professionals (central bankers, economists) have said an important objective is to reduce wage inflation. The objective isn't to reduce wage inflation, it's to reduce general inflation. Restraining wages is one way of doing that.
    - graemep 3y ago
      Yes, but my point is that, even assuming agreement on the objective of reducing inflation, there will still be disagreement on whether whether reducing wage inflation is the right way to do it depending on what your other objectives are.
      - tonyedgecombe 3y ago
        Which is different from implying they want to do it just for the lolz.
- peteradio 3y ago
  Kind of have to agree here. Useless professionals/administrators are a double dip on inflation - they collect large paychecks, contribute nothing but makework for others.
light_hue_1 3y ago
As an academic totally unrelated to economics this whole situation is just astounding. In my field we would say we failed and have the wrong metrics. In economics they say that people are delusional and the economy is actually good. Clearly economists are measuring the wrong things when they declare the economy is good. Add to that one of the least affordable housing markets ever. Obscenely expensive childcare, far more expensive than it's ever been to the point where it's simply crushing for many. The result is an economy where the basics: having a roof, kids, and food are a stretch for many. I don't know a single person who reports the economy is good. I talk to kids around the university all the time and it's normal now for them to have lost hope that they'll be able to afford a house and kids. All of this is made worse by Biden et al. selling this as a victory and so offering zero help.
- frozenport 3y ago
  You’d need to show people aren’t getting what they need rather than saying they are sad because they are spending their money on it.
- nitwit005 3y ago
  Individual people do what you're doing: they talk to people. At the moment they hear a lot of anxiety. The students you mention talking to generally aren't even in the job market. It's all coming second hand. Which isn't to say people have no idea what's going on, but it can be fairly disconnected from reality.
  - whatevaa 3y ago
    It's way more connected to reality than "professional" economists and politicians, though.
  - ThunderSizzle 3y ago
    I'm in the job market. 2-3x local family income, median house price would put us at 60% of take home pay going to purely principal and interest payments. It doesn't take social anxiety to see how unaffordable housing is.
- 3y ago
deafpolygon 3y ago
A sample size of 2k people on a subject like this? Not enough. You're going to get wildly different results just based on where you ask.
- yorwba 3y ago
  They're not asking 2k people all in one place, but 2k people in different places. Which is plenty enough to get a rough national average within a few percentage points.
- croes 3y ago
  It's not the sample size but the sample participants. 2k are more than enough if your sample is chosen correctly.
ShadowBanThis01 3y ago
The answer lies in monopoly.
- throwaway5959 3y ago
  Yeah there really isn’t much competition in the inner parts of supermarkets anymore. It’s like ten companies.
mcntsh 3y ago
Does anyone know anyone who's really doing "well" right now? The highly paid tech workers in my circle are playing dodgeball with weekly layoffs, and on the other side, my friends doing blue-collar trade work say they are feeling the jobs dry up. This is all happening while everything of course gets more expensive, especially staples like housing and food.
- happytiger 3y ago
  Same exact playbook in my network. The only people I know who are doing well are in crypto.
  - thathndude 3y ago
    I’m doing “well” by most standards, and I won’t insult others by denying that. But it’s definitely more of a slog and it’s impacted our spending choices. I simply can’t justify restaurant spending right now, for example. No way I’m buying a new car with 7% interest rates.
- deleted 3y ago
  [deleted]
- chewz 3y ago
  Ten Charts That Explain the U.S. Economy in 2023 https://www.whitehouse.gov/cea/written-materials/2023/12/19/ten-charts-that-explain-the-u-s-economy-in-2023/ https://www.whitehouse.gov/cea/written-materials/2023/12/19/...
  - thathndude 3y ago
    Not to be political, but that’s not a source I have a lot of faith in. We’re in an election year now. Get ready for the propaganda from all sides: The economy sucks because of Biden—he’s only benefiting from what Trump built! The economy is wonderful because of Biden — if Trump gets in it will go back to huge inflation and crap!
    - 3y ago
oglop 3y ago
Our grocery bill hasn’t budged. No meat and no dairy maybe? I’d like to see data on the inflation across sections of food to understand this more.
- acdha 3y ago
  There’s a massive variation across sectors and a lot of it seems to be driven by the larger companies keeping profits high: if you buy a lot of processed food and beef, the supermarket prices are sky high. Costco seems to be largely insulated from that, presumably due to long-term contracts, and our farmers market pricing for things like eggs hasn’t changed much since the local producers weren’t buying huge amounts of feed or selling through the profit-taking middlemen.
  - ianai 3y ago
    Costco limits its markup. Their profits are almost exclusively from membership dues.
    - acdha 3y ago
      Yes, but I think it’s more than that - like during the egg shortage their prices didn’t budge, which I bet is because their contracts are both large and long-term. I suspect the large companies whose profit margins have skyrocketed are willing to let them have less inflated prices since they’re (probably correctly) assuming that most buyers are just going to go to the local supermarket.
      - ianai 3y ago
        Costco also has market power to force better prices from its suppliers as well as decades of relationships with them and industry writ large. I’ve heard they’re employing someone to build lettuce growing capacity near certain logistics points. It was someones pet project to grow lettuce locally that costco picked up. If the free market is let to function, they should eventually be able to eat the lunch of the competition. I bet they did something similar with eggs.
jncfhnb 3y ago
These vibe check surveys feel like they’re guaranteed to generate specific results to me.
- ianai 3y ago
  It might be illustrative if polls were required to post their survey and methods along their results or otherwise disregarded as biased and useless. They won’t do it because “proprietary.”
class3shock 3y ago
No, it's not grocery bills, it's that post pandemic: 1. Used cars go for 50% more than they did before. 2. New cars are selling at or above MSRP. 3. Housing prices went up 30% or more where people want to buy. 4. Interest rates for loans to buy those overpriced houses are now 2-4 times what they were when those prices went up. 5. Rents have gone up and availability has gone down. 6. And yes, on top of that prices for everything have gone up, including groceries. And how have salaries kept up with this? That's right, they haven't. The median income in 2019 was 27.7K and in 2021 went up to... wait for it... 28.8k. No inflation adjustment in there. https://en.wikipedia.org/wiki/Personal_income_in_the_United_States https://en.wikipedia.org/wiki/Personal_income_in_the_United_... This isn't rocket science, why is it that financial and economic reporters seem so out of touch with reality? I have read and listened to multiple interviews that have the same theme of "the percent gdp growth is good, people just think things are bad because they're having an emotional reaction". People think things are bad because the average person can't afford basic things. 29K a year is roughly $2,400 a month. Average rent in the USA is $1,300 https://www.forbes.com/advisor/mortgages/average-rent-by-state/ https://www.forbes.com/advisor/mortgages/average-rent-by-sta... Average car payment (on a used car) is $530 https://www.nerdwallet.com/article/loans/auto-loans/average-monthly-car-payment https://www.nerdwallet.com/article/loans/auto-loans/average-... That leaves $570 for car insurance, health insurance, food, etc. The math doesn't add up for most people and it certainly doesn't add up to being able to afford a more expensive things like a home, a new car, a family. People are frustrated because they look at the future and see forever renting, leasing, working low paying jobs, and never being able to live that lives that most before them did.
- ianai 3y ago
  In the US the congress has largely been stopped for a long time from doing any real checking on these things. Minimum wage could be increased. There’s investigations going into rental price fixing through industry wide software usage. Local, city, regional, up to national governments could but blockades up against corporate ownership of residential properties. But democracy has to work first. As for cars, there is new manufacturing being added to the industry. Further, prices are slower to fall than to rise. In the real estate market it’s the slow trickle of homes selling due to factors forcing them to sell which will push prices down. And grocery prices are possibly a combination of corporate power concentration (see above about democracy needing to work) and an invasion destroying one of the world’s most important breadbaskets (Ukraine).
ianai 3y ago
It’s also been a long time since the Trustbusting times of Theodore Roosevelt and the Great Depression reforms have largely been repealed. Congress absolutely could act if the political will was reflected at the ballot box. Elsewhere it’s been noted these scores don’t line up with how much is actually being purchased by people. There’s something else going on than just economics. Otherwise, I deeply suffered from the Great Recession. Couldn’t find meaningful work for many years. This despite being well educated and qualified. I think we can agree these days are not those days: RE was cheaper. Food was cheaper. There just wasn’t enough demand for labor to employ people and thus fund demand. Trillions in RE “value” had to be marked to market and lost value. Trillions in debt were no longer ever going to be realized. Huge companies were facing bankruptcy and filed bankruptcy. At least one automaker had a sitting POTUS as its CEO for a while. Nowadays, people do seem to be employed but prices have risen. We also have an ever growing war in one of the most important breadbaskets of the world. We knew that was going to raise global food prices.
ianai 3y ago
Alternative hypothesis, its taking time for interest rates to hit commodity prices downward: https://news.ycombinator.com/item?id=38992091 https://news.ycombinator.com/item?id=38992091 , https://scholar.harvard.edu/frankel/effects-interest-rates-commodity-prices https://scholar.harvard.edu/frankel/effects-interest-rates-c...
watersb 3y ago
FINALLY someone notices. Living in a small town with one grocery store, we've seen grocery prices up at least 25% from the Before Times. On a fixed income, this is a very big deal. Some level of food demand is not elastic: you have to eat. National macroeconomic policy rarely affects domestic grocery prices. It's hard to listen to political leaders who last shopped for groceries in the 20th century.

37 points by DocFeind 3y ago

>— an economy that the professionals say is doing pretty well The so-called "professionals" are simply useless, and guess what...people are figuring that out too.

Mountain_Skies 3y ago
Wonder if they're the same professionals whose numbers keep getting quietly revised in a worse direction a few months after the initial rosy numbers are released.
ozim 3y ago
There is a lot of BS in finance, but throwing blanket statements is something I don’t like. Just like the fact that I can go to grocery store and get dozens variations of food is because of “professionals”. Financial services help build up farmers sustainability and help new companies build supply chains. Lots of nice things we can enjoy in first world countries would not happen if there would not be people making sure that money can move around.
- ithkuil 3y ago
  This sentiment taps in a generic meme that has infected society of late. Starting from the fact that many professionals made many mistakes over time, the meme trips you into concluding that if there were no people in that category of "professionals" , then these mistakes wouldn't be made and somehow society would just work "correctly" if it wasn't for those pesky "professionals". This meme builds on a time-honored meme that comes in vary forms such as "a member of that other ethnic group committed this crime; if we only got rid of all members of that ethnic group then those crimes wouldn't happen"
  - tanseydavid 3y ago
    IMHO you're overthinking it. It is as simple as a mismatch in situational awareness. An expert considering the macro side of an economy with 330 million people in it cannot meaningfully tell any one individual that things are good/ok if that individual's situation is growing noticeably worse with the same earnings. No memes are required.
    - ithkuil 3y ago
      That explains why there is a perception that experts are disconnected from the reality. But that doesn't explain how people can think they can just trash all expertise and think the good parts of the world will keep working just fine.
- TheOtherHobbes 3y ago
  There are plenty of people in the US who can't afford to go to the grocery store at all. https://gitnux.org/food-bank-statistics/ https://gitnux.org/food-bank-statistics/
Ekaros 3y ago
Or has the economy come to mean that most of stock market is going up... And as long as that continues everything is great and it really should be only goal of any policy...
- TheOtherHobbes 3y ago
  I find it informative and revealing to replace "the economy" with "what rich people want." Because that's pretty much what it means in practice.
- gmerc 3y ago
  and while tech was a growth industry nobody cared. For most blue collar workers “the economy is red hot” during the tech booms also sounded like bullshit. Echo chamber.
graemep 3y ago
The problem is a matter of point of view. What constitutes the economy "doing well" is subjective. If you are looking at a measure like GDP it includes a number of things such as wages and profits. If wages fall but businesses increase profits by more the economy is "doing well" on that metric. There has been a recent example of that in the UK, where a number of politicians and professionals (central bankers, economists) have said an important objective is to reduce wage inflation. If you are someone who is paid wages (especially if you real terms wages have been reduced by price inflation) you are quite likely not think this is a desirable objective.
- tonyedgecombe 3y ago
  >There has been a recent example of that in the UK, where a number of politicians and professionals (central bankers, economists) have said an important objective is to reduce wage inflation. The objective isn't to reduce wage inflation, it's to reduce general inflation. Restraining wages is one way of doing that.
  - graemep 3y ago
    Yes, but my point is that, even assuming agreement on the objective of reducing inflation, there will still be disagreement on whether whether reducing wage inflation is the right way to do it depending on what your other objectives are.
    - tonyedgecombe 3y ago
      Which is different from implying they want to do it just for the lolz.
peteradio 3y ago
Kind of have to agree here. Useless professionals/administrators are a double dip on inflation - they collect large paychecks, contribute nothing but makework for others.

light_hue_1 3y ago

As an academic totally unrelated to economics this whole situation is just astounding. In my field we would say we failed and have the wrong metrics. In economics they say that people are delusional and the economy is actually good. Clearly economists are measuring the wrong things when they declare the economy is good. Add to that one of the least affordable housing markets ever. Obscenely expensive childcare, far more expensive than it's ever been to the point where it's simply crushing for many. The result is an economy where the basics: having a roof, kids, and food are a stretch for many. I don't know a single person who reports the economy is good. I talk to kids around the university all the time and it's normal now for them to have lost hope that they'll be able to afford a house and kids. All of this is made worse by Biden et al. selling this as a victory and so offering zero help.

frozenport 3y ago
You’d need to show people aren’t getting what they need rather than saying they are sad because they are spending their money on it.
nitwit005 3y ago
Individual people do what you're doing: they talk to people. At the moment they hear a lot of anxiety. The students you mention talking to generally aren't even in the job market. It's all coming second hand. Which isn't to say people have no idea what's going on, but it can be fairly disconnected from reality.
- whatevaa 3y ago
  It's way more connected to reality than "professional" economists and politicians, though.
- ThunderSizzle 3y ago
  I'm in the job market. 2-3x local family income, median house price would put us at 60% of take home pay going to purely principal and interest payments. It doesn't take social anxiety to see how unaffordable housing is.
3y ago

deafpolygon 3y ago

A sample size of 2k people on a subject like this? Not enough. You're going to get wildly different results just based on where you ask.

yorwba 3y ago
They're not asking 2k people all in one place, but 2k people in different places. Which is plenty enough to get a rough national average within a few percentage points.
croes 3y ago
It's not the sample size but the sample participants. 2k are more than enough if your sample is chosen correctly.

ShadowBanThis01 3y ago

The answer lies in monopoly.

throwaway5959 3y ago
Yeah there really isn’t much competition in the inner parts of supermarkets anymore. It’s like ten companies.

mcntsh 3y ago

Does anyone know anyone who's really doing "well" right now? The highly paid tech workers in my circle are playing dodgeball with weekly layoffs, and on the other side, my friends doing blue-collar trade work say they are feeling the jobs dry up. This is all happening while everything of course gets more expensive, especially staples like housing and food.

happytiger 3y ago
Same exact playbook in my network. The only people I know who are doing well are in crypto.
- thathndude 3y ago
  I’m doing “well” by most standards, and I won’t insult others by denying that. But it’s definitely more of a slog and it’s impacted our spending choices. I simply can’t justify restaurant spending right now, for example. No way I’m buying a new car with 7% interest rates.
deleted 3y ago
[deleted]
chewz 3y ago
Ten Charts That Explain the U.S. Economy in 2023 https://www.whitehouse.gov/cea/written-materials/2023/12/19/ten-charts-that-explain-the-u-s-economy-in-2023/ https://www.whitehouse.gov/cea/written-materials/2023/12/19/...
- thathndude 3y ago
  Not to be political, but that’s not a source I have a lot of faith in. We’re in an election year now. Get ready for the propaganda from all sides: The economy sucks because of Biden—he’s only benefiting from what Trump built! The economy is wonderful because of Biden — if Trump gets in it will go back to huge inflation and crap!
  - 3y ago

oglop 3y ago

Our grocery bill hasn’t budged. No meat and no dairy maybe? I’d like to see data on the inflation across sections of food to understand this more.

acdha 3y ago
There’s a massive variation across sectors and a lot of it seems to be driven by the larger companies keeping profits high: if you buy a lot of processed food and beef, the supermarket prices are sky high. Costco seems to be largely insulated from that, presumably due to long-term contracts, and our farmers market pricing for things like eggs hasn’t changed much since the local producers weren’t buying huge amounts of feed or selling through the profit-taking middlemen.
- ianai 3y ago
  Costco limits its markup. Their profits are almost exclusively from membership dues.
  - acdha 3y ago
    Yes, but I think it’s more than that - like during the egg shortage their prices didn’t budge, which I bet is because their contracts are both large and long-term. I suspect the large companies whose profit margins have skyrocketed are willing to let them have less inflated prices since they’re (probably correctly) assuming that most buyers are just going to go to the local supermarket.
    - ianai 3y ago
      Costco also has market power to force better prices from its suppliers as well as decades of relationships with them and industry writ large. I’ve heard they’re employing someone to build lettuce growing capacity near certain logistics points. It was someones pet project to grow lettuce locally that costco picked up. If the free market is let to function, they should eventually be able to eat the lunch of the competition. I bet they did something similar with eggs.

jncfhnb 3y ago

These vibe check surveys feel like they’re guaranteed to generate specific results to me.

ianai 3y ago
It might be illustrative if polls were required to post their survey and methods along their results or otherwise disregarded as biased and useless. They won’t do it because “proprietary.”

class3shock 3y ago

No, it's not grocery bills, it's that post pandemic: 1. Used cars go for 50% more than they did before. 2. New cars are selling at or above MSRP. 3. Housing prices went up 30% or more where people want to buy. 4. Interest rates for loans to buy those overpriced houses are now 2-4 times what they were when those prices went up. 5. Rents have gone up and availability has gone down. 6. And yes, on top of that prices for everything have gone up, including groceries. And how have salaries kept up with this? That's right, they haven't. The median income in 2019 was 27.7K and in 2021 went up to... wait for it... 28.8k. No inflation adjustment in there. https://en.wikipedia.org/wiki/Personal_income_in_the_United_States https://en.wikipedia.org/wiki/Personal_income_in_the_United_... This isn't rocket science, why is it that financial and economic reporters seem so out of touch with reality? I have read and listened to multiple interviews that have the same theme of "the percent gdp growth is good, people just think things are bad because they're having an emotional reaction". People think things are bad because the average person can't afford basic things. 29K a year is roughly $2,400 a month. Average rent in the USA is $1,300 https://www.forbes.com/advisor/mortgages/average-rent-by-state/ https://www.forbes.com/advisor/mortgages/average-rent-by-sta... Average car payment (on a used car) is $530 https://www.nerdwallet.com/article/loans/auto-loans/average-monthly-car-payment https://www.nerdwallet.com/article/loans/auto-loans/average-... That leaves $570 for car insurance, health insurance, food, etc. The math doesn't add up for most people and it certainly doesn't add up to being able to afford a more expensive things like a home, a new car, a family. People are frustrated because they look at the future and see forever renting, leasing, working low paying jobs, and never being able to live that lives that most before them did.

ianai 3y ago
In the US the congress has largely been stopped for a long time from doing any real checking on these things. Minimum wage could be increased. There’s investigations going into rental price fixing through industry wide software usage. Local, city, regional, up to national governments could but blockades up against corporate ownership of residential properties. But democracy has to work first. As for cars, there is new manufacturing being added to the industry. Further, prices are slower to fall than to rise. In the real estate market it’s the slow trickle of homes selling due to factors forcing them to sell which will push prices down. And grocery prices are possibly a combination of corporate power concentration (see above about democracy needing to work) and an invasion destroying one of the world’s most important breadbaskets (Ukraine).

ianai 3y ago

It’s also been a long time since the Trustbusting times of Theodore Roosevelt and the Great Depression reforms have largely been repealed. Congress absolutely could act if the political will was reflected at the ballot box. Elsewhere it’s been noted these scores don’t line up with how much is actually being purchased by people. There’s something else going on than just economics. Otherwise, I deeply suffered from the Great Recession. Couldn’t find meaningful work for many years. This despite being well educated and qualified. I think we can agree these days are not those days: RE was cheaper. Food was cheaper. There just wasn’t enough demand for labor to employ people and thus fund demand. Trillions in RE “value” had to be marked to market and lost value. Trillions in debt were no longer ever going to be realized. Huge companies were facing bankruptcy and filed bankruptcy. At least one automaker had a sitting POTUS as its CEO for a while. Nowadays, people do seem to be employed but prices have risen. We also have an ever growing war in one of the most important breadbaskets of the world. We knew that was going to raise global food prices.

ianai 3y ago

Alternative hypothesis, its taking time for interest rates to hit commodity prices downward: https://news.ycombinator.com/item?id=38992091 https://news.ycombinator.com/item?id=38992091 , https://scholar.harvard.edu/frankel/effects-interest-rates-commodity-prices https://scholar.harvard.edu/frankel/effects-interest-rates-c...

watersb 3y ago

FINALLY someone notices. Living in a small town with one grocery store, we've seen grocery prices up at least 25% from the Before Times. On a fixed income, this is a very big deal. Some level of food demand is not elastic: you have to eat. National macroeconomic policy rarely affects domestic grocery prices. It's hard to listen to political leaders who last shopped for groceries in the 20th century.