4 ms·

Wait, am I reading this wrong. The producer and importer try to soften the impact of the tarrifs only for the retailer to massively increase their prices?

ceejayoz 8mo ago
See also: Grocery stores. Prices went up "due to COVID". Prices will never come down again. (I've no doubt the supply chain was a mess for a hot minute, but years later?)
- asah 8mo ago
  so that's not true - I worked for years in the grocery business and prices DO come down and in fact, I've seen evidence all over the NYC market of prices falling recently. examples include eggs for $2.99 in some places (!), and other competitive categories like unbranded meat and cheese, pasta, and more. prepared foods seem to be slower, I'm assuming because labor costs continue to rise.
  - loloquwowndueo 8mo ago
    You worked for years in the grocery business but all you have is anecdata? I also have anecdata, my grocery bill has not come down from pandemic times. Things like eggs are definitely more expensive.
    - tartoran 8mo ago
      Prices never came back to pre-pandemic levels, that is absolutely correct. But if you remember that prices ballooned last year when Trump just took office, eggs were getting more and more expensive, etc and I gotta say prices came down a bit after that, but always never to previous levels.
  - ceejayoz 8mo ago
    So that's not true. A few months ago: https://www.npr.org/2025/09/19/nx-s1-5539547/grocery-prices-tariffs-food-inflation https://www.npr.org/2025/09/19/nx-s1-5539547/grocery-prices-... > What's the item? Groceries > How has the price changed since before the pandemic? > Up 29% since February 2020, according to the Bureau of Labor Statistics.
    - cfiggers 8mo ago
      "That's not true" is too strong a statement on your part. The statistic you cite does not necessarily contradict what the parent comment is saying. "Up 29% since February 2020" is an absolute change since a specific point. The parent comment is saying prices have "come down" i.e. since their peak. It can still be up overall, so long as it's not up as high as it was at one point. EDIT: To be clear, the parent comment might still be wrong, or might be right only within a biased sample (i.e. their own experience). I'm only making the point that the statistic you're referencing does not outright disprove what they're saying. Prices can be up since six years ago AND down since two years ago (random time periods chosen for illustration only).
      - ceejayoz 8mo ago
        I'm gonna value national stats over unsourced anecdotal assertions. At no point has the US entered deflation so far this millennium.
        DennisP 8mo ago
        The US did have deflation in the fourth quarter of 2008: https://www.ebsco.com/research-starters/economics/deflation https://www.ebsco.com/research-starters/economics/deflation Of course this is talking about the overall price level. The prices in specific sectors can fluctuate independently of that. Food and energy in particular are excluded from core inflation because they're especially volatile.
- OscarCunningham 8mo ago
  This is a deliberate choice by Congress to give the Fed a mandate to target 2% inflation. In particular Congress hasn't given them any instruction to try to make up for mistakes. If inflation overshoots in one year then they don't try to undershoot in the next year. They just keep trying to hit 2% inflation. So if retailers tried to lower prices to pre-COVID levels then they would fail. The Fed would see the falling prices and cut rates until 2% inflation was achieved.
  - adrianN 8mo ago
    At least where I live I have the feeling that groceries got expensive faster than 2% per year for a number of years now.
- kjshsh123 8mo ago
  Wages also changed since then. During COVID food outpaced wages. Since then, wages have outpaced food. Maybe not for you but on average. Just like food prices didn't just jump one day, they won't just drop one day. We target 2% inflation, so they'll still go up, but slower. Going up slower than wages means better affordability.
- marcosdumay 8mo ago
  Prices went up because of this: https://fred.stlouisfed.org/series/M1SL https://fred.stlouisfed.org/series/M1SL
  - jollyllama 8mo ago
    What's your explanation for the mechanism? Because my understanding is that the M1 spike was largely an accounting rule change [0], not a "money printer go brr." [0] https://collabfund.com/blog/the-fed-isnt-printing-as-much-money-as-you-think/ https://collabfund.com/blog/the-fed-isnt-printing-as-much-mo...
    - marcosdumay 8mo ago
      As your link says, the spike was the result of a change in policy, not an accounting rule change. Effectively, there is very little difference between printing the money or just making some extra money available for use. The money printer was also going brr. And that is probably the cause for some of the inflation.
RobotToaster 8mo ago
Never miss an opportunity to raise prices.
estimator7292 8mo ago
Yes, that sounds exactly correct. Prices only go up, all that's required is a plausible excuse. This is what happens when you shape your entire individual and cultural identity around "number go up"
- kjshsh123 8mo ago
  Retailer profits from foreign wine decreased because of reductions in sales (~12% iirc). This is textbook econ 101, profit maximization of a firm, supply and demand etc. Taxes make after tax prices go up and reduce profits due to reduced quantity. No reason to go searching for a "plausible excuse" or some greater critique of culture.
jm4 8mo ago
Many retailers increase their prices by multiples of the tariff increase rather than a straight passthrough so that they can maintain their margins. It's probably why a lot of the biggest retailers with monopolies aren't complaining much about tariffs. They mostly keep the same margin and actually increase revenue. Meanwhile, it's been incredibly damaging to small businesses and consumers. Functionally, tariffs have been a massive wealth transfer.
- harmmonica 8mo ago
  Can't repeat this enough and I'd like to make sure to connect the dots. The Big Beautiful Bill that was signed into law cut taxes. To keep the US Federal Government from going (even more) into debt, Trump introduced aggressive tariffs (it doesn't matter that he introduced the tariffs before the BBB became law because he/they knew the BBB would pass and that was baked into the tariff decision). The BBB tax cuts benefit the wealthy much more than the average person. The tariffs are borne by both the wealthy and by the average person when they buy tariffed goods, but those tariffs are easily absorbed by the wealthy while acting as an additional tax on the average person by increasing prices. This is just about as direct a transfer of wealth from the average person to the wealthy as you could possibly put into place (barring an actual transfer where the average person is taxed and those dollars are literally transferred directly into a wealthy person's bank account). In a way, it's a genius move. Convince a healthy chunk of the US population that you're on a populist crusade to bring jobs back to America while increasing the wealth of the wealthy and taking even more of the average person's income. Don't forget that the reason the jobs were exported in the first place was to decrease costs so that, you guessed it, wealthy people would get wealthier (but at least in that scenario the cost of a tv went way down, am I right???). All that said, I don't mean to suggest that bringing jobs back isn't actually a goal. It's just not the primary goal. My take on the priorities of the current admin's tax policy, including the tariffs (which, broken record, are taxes) 1. decrease taxes on the wealthy 2. decrease income taxes on everyone else who pays taxes 3. get "everyone else who pays taxes" to fund the decreased taxes on the wealthy 4. bring jobs back. Somewhere in there is also "create a mechanism for opaque profiteering." I'm not quite sure where that falls on the list. Cynically it's probably number 2.
kjshsh123 8mo ago
Nobody is "trying to soften the impact of tariffs". Everyone was and is trying to maximize profits. Who ends up paying has to do with "elasticity" which roughly is about how much the tax actually impacts you. In this case, it ended up that the retailer raised prices, probably because the retailer can just sell domestic wine for cheaper (close substitute). Retailer profits still didn't increase because of reductions in sales (~12% iirc) and increase in after-tariff inventory prices. This is textbook econ 101. Substitute, profit maximization of a firm, supply and demand etc. You're confusing exporter and importer lowering prices with the retailer facing lower after-tariff inventory costs. Inventory costs still went up.

ceejayoz 8mo ago

See also: Grocery stores. Prices went up "due to COVID". Prices will never come down again. (I've no doubt the supply chain was a mess for a hot minute, but years later?)

asah 8mo ago
so that's not true - I worked for years in the grocery business and prices DO come down and in fact, I've seen evidence all over the NYC market of prices falling recently. examples include eggs for $2.99 in some places (!), and other competitive categories like unbranded meat and cheese, pasta, and more. prepared foods seem to be slower, I'm assuming because labor costs continue to rise.
- loloquwowndueo 8mo ago
  You worked for years in the grocery business but all you have is anecdata? I also have anecdata, my grocery bill has not come down from pandemic times. Things like eggs are definitely more expensive.
  - tartoran 8mo ago
    Prices never came back to pre-pandemic levels, that is absolutely correct. But if you remember that prices ballooned last year when Trump just took office, eggs were getting more and more expensive, etc and I gotta say prices came down a bit after that, but always never to previous levels.
- ceejayoz 8mo ago
  So that's not true. A few months ago: https://www.npr.org/2025/09/19/nx-s1-5539547/grocery-prices-tariffs-food-inflation https://www.npr.org/2025/09/19/nx-s1-5539547/grocery-prices-... > What's the item? Groceries > How has the price changed since before the pandemic? > Up 29% since February 2020, according to the Bureau of Labor Statistics.
  - cfiggers 8mo ago
    "That's not true" is too strong a statement on your part. The statistic you cite does not necessarily contradict what the parent comment is saying. "Up 29% since February 2020" is an absolute change since a specific point. The parent comment is saying prices have "come down" i.e. since their peak. It can still be up overall, so long as it's not up as high as it was at one point. EDIT: To be clear, the parent comment might still be wrong, or might be right only within a biased sample (i.e. their own experience). I'm only making the point that the statistic you're referencing does not outright disprove what they're saying. Prices can be up since six years ago AND down since two years ago (random time periods chosen for illustration only).
    - ceejayoz 8mo ago
      I'm gonna value national stats over unsourced anecdotal assertions. At no point has the US entered deflation so far this millennium.
      - DennisP 8mo ago
        The US did have deflation in the fourth quarter of 2008: https://www.ebsco.com/research-starters/economics/deflation https://www.ebsco.com/research-starters/economics/deflation Of course this is talking about the overall price level. The prices in specific sectors can fluctuate independently of that. Food and energy in particular are excluded from core inflation because they're especially volatile.
OscarCunningham 8mo ago
This is a deliberate choice by Congress to give the Fed a mandate to target 2% inflation. In particular Congress hasn't given them any instruction to try to make up for mistakes. If inflation overshoots in one year then they don't try to undershoot in the next year. They just keep trying to hit 2% inflation. So if retailers tried to lower prices to pre-COVID levels then they would fail. The Fed would see the falling prices and cut rates until 2% inflation was achieved.
- adrianN 8mo ago
  At least where I live I have the feeling that groceries got expensive faster than 2% per year for a number of years now.
kjshsh123 8mo ago
Wages also changed since then. During COVID food outpaced wages. Since then, wages have outpaced food. Maybe not for you but on average. Just like food prices didn't just jump one day, they won't just drop one day. We target 2% inflation, so they'll still go up, but slower. Going up slower than wages means better affordability.
marcosdumay 8mo ago
Prices went up because of this: https://fred.stlouisfed.org/series/M1SL https://fred.stlouisfed.org/series/M1SL
- jollyllama 8mo ago
  What's your explanation for the mechanism? Because my understanding is that the M1 spike was largely an accounting rule change [0], not a "money printer go brr." [0] https://collabfund.com/blog/the-fed-isnt-printing-as-much-money-as-you-think/ https://collabfund.com/blog/the-fed-isnt-printing-as-much-mo...
  - marcosdumay 8mo ago
    As your link says, the spike was the result of a change in policy, not an accounting rule change. Effectively, there is very little difference between printing the money or just making some extra money available for use. The money printer was also going brr. And that is probably the cause for some of the inflation.

RobotToaster 8mo ago

Never miss an opportunity to raise prices.

estimator7292 8mo ago

Yes, that sounds exactly correct. Prices only go up, all that's required is a plausible excuse. This is what happens when you shape your entire individual and cultural identity around "number go up"

kjshsh123 8mo ago
Retailer profits from foreign wine decreased because of reductions in sales (~12% iirc). This is textbook econ 101, profit maximization of a firm, supply and demand etc. Taxes make after tax prices go up and reduce profits due to reduced quantity. No reason to go searching for a "plausible excuse" or some greater critique of culture.

jm4 8mo ago

Many retailers increase their prices by multiples of the tariff increase rather than a straight passthrough so that they can maintain their margins. It's probably why a lot of the biggest retailers with monopolies aren't complaining much about tariffs. They mostly keep the same margin and actually increase revenue. Meanwhile, it's been incredibly damaging to small businesses and consumers. Functionally, tariffs have been a massive wealth transfer.

harmmonica 8mo ago
Can't repeat this enough and I'd like to make sure to connect the dots. The Big Beautiful Bill that was signed into law cut taxes. To keep the US Federal Government from going (even more) into debt, Trump introduced aggressive tariffs (it doesn't matter that he introduced the tariffs before the BBB became law because he/they knew the BBB would pass and that was baked into the tariff decision). The BBB tax cuts benefit the wealthy much more than the average person. The tariffs are borne by both the wealthy and by the average person when they buy tariffed goods, but those tariffs are easily absorbed by the wealthy while acting as an additional tax on the average person by increasing prices. This is just about as direct a transfer of wealth from the average person to the wealthy as you could possibly put into place (barring an actual transfer where the average person is taxed and those dollars are literally transferred directly into a wealthy person's bank account). In a way, it's a genius move. Convince a healthy chunk of the US population that you're on a populist crusade to bring jobs back to America while increasing the wealth of the wealthy and taking even more of the average person's income. Don't forget that the reason the jobs were exported in the first place was to decrease costs so that, you guessed it, wealthy people would get wealthier (but at least in that scenario the cost of a tv went way down, am I right???). All that said, I don't mean to suggest that bringing jobs back isn't actually a goal. It's just not the primary goal. My take on the priorities of the current admin's tax policy, including the tariffs (which, broken record, are taxes) 1. decrease taxes on the wealthy 2. decrease income taxes on everyone else who pays taxes 3. get "everyone else who pays taxes" to fund the decreased taxes on the wealthy 4. bring jobs back. Somewhere in there is also "create a mechanism for opaque profiteering." I'm not quite sure where that falls on the list. Cynically it's probably number 2.

kjshsh123 8mo ago

Nobody is "trying to soften the impact of tariffs". Everyone was and is trying to maximize profits. Who ends up paying has to do with "elasticity" which roughly is about how much the tax actually impacts you. In this case, it ended up that the retailer raised prices, probably because the retailer can just sell domestic wine for cheaper (close substitute). Retailer profits still didn't increase because of reductions in sales (~12% iirc) and increase in after-tariff inventory prices. This is textbook econ 101. Substitute, profit maximization of a firm, supply and demand etc. You're confusing exporter and importer lowering prices with the retailer facing lower after-tariff inventory costs. Inventory costs still went up.