Inflation!

Man this seems like the fastest inflation I've seen in my life. I stopped in Town Hall Deli today for the first time in a few months and prices are up like 2-3 bucks a sandwich. Park Wood has a new menu with higher prices. 10 wings at a chicken wing joint down the shore ran me $18.29 last week. Etc etc.

The pundits generally say this inflation we're seeing is "transitory", but I find it hard to believe prices on a lot of this stuff are ever coming back down.  

When economists talk about inflation being transitory, it's worth keeping in mind that they're generally talking over a longer timeline and more broadly than non-economists generally mean. Eg sandwich prices going up, on its own, isn't necessarily what the mean by inflation. And from what I've read, they're looking at the next year or two, which again can be at odds with personal experience which is generally at a more immediate timeline.

To wit -- Washington Post:

Prices rise 5.3 percent in August over last year, in early sign that inflation could be easing

Already in the headline there's some mixed messages -- policy makers see signs that inflation is easing, but as an individual 5.3% doesn't feel like easing to me.

And more such mixed takeaways in the article content -- again, I think a lot of it stems from the different ways economists vs individuals parse economic news (and as to potential political effects, well, this is Soapbox, not Soapbox All Politics, so even better reason to resist the temptation for pretending I can predict the future with anything approaching reliability).

For food prices in general, I suspect one factor is workers demanding higher wages while businesses resist. I'll be political here and say that I'm fully on board with higher wages here, and if that means paying more for my sandwiches so be it. I spent last year safely working from home, making my same salary and spending a lot less; I'm certainly not going to begrudge those less lucky looking for some recompense for the risks they had, and have, to take as "essential" workers.

I want to know what the deal is with bacon prices.

PVW said:

When economists talk about inflation being transitory, it's worth keeping in mind that they're generally talking over a longer timeline and more broadly than non-economists generally mean. Eg sandwich prices going up, on its own, isn't necessarily what the mean by inflation. And from what I've read, they're looking at the next year or two, which again can be at odds with personal experience which is generally at a more immediate timeline.

To wit -- Washington Post:

Prices rise 5.3 percent in August over last year, in early sign that inflation could be easing

Already in the headline there's some mixed messages -- policy makers see signs that inflation is easing, but as an individual 5.3% doesn't feel like easing to me.

We'll see how much it eases. This last minute easing of August doesn't help seniors. The Soc Sec COLA is calculated using the Jul, Aug and Sep numbers. 

The COLA was estimated to be 6.3% after the July numbers came out. An estimate because the Aug and Sep numbers haven't then come out. With Aug it now looks like 5%. If Sep is like Aug it may be a COLA of 4%, instead of the original 6.3%.

It would be ironic indeed if after September the inflation burst picked up.

Smedley said:

Man this seems like the fastest inflation I've seen in my life. I stopped in Town Hall Deli today for the first time in a few months and prices are up like 2-3 bucks a sandwich. Park Wood has a new menu with higher prices. 10 wings at a chicken wing joint down the shore ran me $18.29 last week. Etc etc.

The pundits generally say this inflation we're seeing is "transitory", but I find it hard to believe prices on a lot of this stuff are ever coming back down.  

if inflation is transitory, it doesn't mean prices will come back down.  It just means they won't continue to rise as fast. 

Fair point, and I did miss that nuance in my OP in implying that transitory would mean the Town Hall Hero goes back to the $9.99 I remember, down from the $12.99 it is now. Transitory doesn't means prices *will* come back down, but they may come back down. (I don't believe they will) 

From https://www.globest.com/2021/08/25/when-transitory-inflation-really-means-dont-worry/

“Transitory” inflation could mean one of three scenarios:

1. Prices rise and plunge
2. Prices rise and stay where they are
3. Prices rise and continue to rise, but more slowly

The way I understand it, food service has taken a triple whammy from the last 18 months. 

1. Closures and reduced business, especially early in the pandemic
2. Increased cost of getting people back to working in food service jobs
3. Disrupted supply chains

II have also noticed significant increases in food costs. I also notice every restaurant and hotel is trying to hire staff. A friend who works for a restaurant group says it's his biggest challenge right now. 

My interpretation is getting people back to work means paying them more, which translates to higher cost to the consumer. There are other factors such as how hard the meat processing industry was hit by COVID, so I won't pretend I know the full answer.  

One other thought... these businesses may all be finding themselves with a financial hole to climb out of. It could just be they need to charge more to make up for lost business. 

Supply chains and raw materials have been massively disrupted on a global scale by COVID-19.

We have announced 5 different price increase this year at my company (B2B/manufacturing).  Our raw materials, freight, and packaging costs have all increased significantly.  I don't see a scenario where these costs come back down in 2022, maybe longer term.

Smedley said:

Man this seems like the fastest inflation I've seen in my life. I stopped in Town Hall Deli today for the first time in a few months and prices are up like 2-3 bucks a sandwich. Park Wood has a new menu with higher prices. 10 wings at a chicken wing joint down the shore ran me $18.29 last week. Etc etc.

The pundits generally say this inflation we're seeing is "transitory", but I find it hard to believe prices on a lot of this stuff are ever coming back down.  

drummerboy said:

I want to know what the deal is with bacon prices.

 Answer - The Meat. "Prices for beef, pork and chicken have surged during the pandemic, and the Biden administration believes it knows who's partly behind it: a handful of big meatpacking companies that control most of the country's supply."

The White House Wants To Bust The Big Meat Industry Open : NPR

Regarding wages, I see it as a marketplace thing. Oversimplified, yeah.

Say I want to buy a wifi expander 'cause ours is just not cutting it. After I choose a model, I shop around for the best price.

Say I'm the retailer that sells that wifi thingie - I try to find the best deal to get that thing into my store (whatever form it's in) and sell it a profit that allows my business to stay afloat.

Say I'm the manufacturer of that wifi thingie - I'm going to try to get as much profit from selling it as I can. (Within reason is a whole other donnybrook)

Now, say I'm a person who has a product to offer, my time, expertise & effort to do some kind of job. As with other situations where profit is a motive, I'm going to consider where I can get paid well - enough to make a living that gets my bills paid, food on the table, my family cared for, maybe even save something.

So many people haven't been getting such wages for years and now that we've seen that people have been closer to taking care of their needs with the government unemployment benefits and the extra levels (like for each child etc.), they have a better picture of what they'll need for compensation. Plus, many of them have experienced health benefits, both physical and mental, from being away from the jobs they had.

Why the **** would they want to go back to that job at their pre-COVID wages knowing what it was doing *to them* and not doing *for them*? The workforce has a bit more of an edge and it is showing here and there with hiring bonuses and higher wages, like $15/hr.

Does that mean higher prices will spring up for the products along the way from the manufacturer to the customer's hands? Yes. But I believe that if people have better wages, they will put that money back into the economy and perhaps some savings. Just like how the folks who benefited from the latest round of tax cuts di - oh wtf am I saying?

A friend owns a local retail business. Shipping and delivery costs have risen sharply over the past few months, so while there are still major supply chain issues, it costs way more to obtain the goods you can get your hands on. (She has already attempted to pre-order merchandise for Valentine’s Day and been told it’s not available…)

$15.50 for a bacon cheeseburger and fries! Total bill for 2 bacon cheeseburgers, a coffee, and substitute sweet potato fries was over $37.00 in the Village.   I agree people should get better wages but.....that seems a little steep to me.

ginpeace said:

$15.50 for a bacon cheeseburger and fries! Total bill for 2 bacon cheeseburgers, a coffee, and substitute sweet potato fries was over $37.00 in the Village.   I agree people should get better wages but.....that seems a little steep to me.

 How about the rent? Wages is nothing compared to the rent in the village. 

Jaytee said:

ginpeace said:

$15.50 for a bacon cheeseburger and fries! Total bill for 2 bacon cheeseburgers, a coffee, and substitute sweet potato fries was over $37.00 in the Village.   I agree people should get better wages but.....that seems a little steep to me.

 How about the rent? Wages is nothing compared to the rent in the village. 

and for those too young to remember REAL inflation:

U.S. inflation rate in 1980: 13.50%

ginpeace said:

$15.50 for a bacon cheeseburger and fries! Total bill for 2 bacon cheeseburgers, a coffee, and substitute sweet potato fries was over $37.00 in the Village.   I agree people should get better wages but.....that seems a little steep to me.

 Where at? Doesn't sound too bad to me, so I'm guessing Maple Leaf Diner? 

But I guess perceived steepness comes down to what the same meal cost 6 months or a year ago.

That's pretty much the dilemma in this country. People saying that yeah, workers deserve a living wage, but no, I don't want to pay higher prices. 

ml1 said:

That's pretty much the dilemma in this country. People saying that yeah, workers deserve a living wage, but no, I don't want to pay higher prices. 

 we've been spoiled, for decades now, with a stagnant, poverty level  minimum wage.

ginpeace said:

$15.50 for a bacon cheeseburger and fries! Total bill for 2 bacon cheeseburgers, a coffee, and substitute sweet potato fries was over $37.00 in the Village.   I agree people should get better wages but.....that seems a little steep to me.

 As long as people will pay it, it isn't too steep.  If people stop paying the prices, they might come down.  Or the businesses might go under.  We don't have an inalienable right to low prices ... the market will do its thing. We can participate as we are able and desire or we can find alternatives, like cooking more at home. (Yes, I know groceries are up also, but it still costs much less than eating out ... says she who eats more restaurant food than home-cooked these days.)

So I goes on a hike today, scheduled for an after hike stop at a new deli that opened up in Stockton. One of the hikers is Jonsin'  for a pastrami sandwich and me thinks, that's not a bad idea. 

I can't read the menu up on the wall but what da hell can a pastrami sandwich cost.. I pick up a $2 can of soda ...

"Gimme a hot pastrami on Rye bread (don't toast it. "

I go to pay the bill with Apple Pay ---- $23 30.  

"$20 for a pastrami sandwich?  Cancel that."

Cashier: "But its got a lot of meat in it."

I take the soda to sit outside with my friends. Guy gets his pastrami sandwich to share with his wife and guess what? About the same amount of meat at Goldbergs'

Smedley said:

ginpeace said:

$15.50 for a bacon cheeseburger and fries! Total bill for 2 bacon cheeseburgers, a coffee, and substitute sweet potato fries was over $37.00 in the Village.   I agree people should get better wages but.....that seems a little steep to me.

 Where at? Doesn't sound too bad to me, so I'm guessing Maple Leaf Diner? 

But I guess perceived steepness comes down to what the same meal cost 6 months or a year ago.

 That's what I was thinking. The Gate still has bacon cheeseburgers for $13, though.

Formerlyjerseyjack said:

So I goes on a hike today, scheduled for an after hike stop at a new deli that opened up in Stockton. One of the hikers is Jonsin'  for a pastrami sandwich and me thinks, that's not a bad idea. 

I can't read the menu up on the wall but what da hell can a pastrami sandwich cost.. I pick up a $2 can of soda ...

"Gimme a hot pastrami on Rye bread (don't toast it. "

I go to pay the bill with Apple Pay ---- $23 30.  

"$20 for a pastrami sandwich?  Cancel that."

Cashier: "But its got a lot of meat in it."

I take the soda to sit outside with my friends. Guy gets his pastrami sandwich to share with his wife and guess what? About the same amount of meat at Goldbergs'

 So you canceled the order after they made the sandwich? Man if I were an employee I would have been tempted to throw it at you. 

Smedley said:

Formerlyjerseyjack said:

So I goes on a hike today, scheduled for an after hike stop at a new deli that opened up in Stockton. One of the hikers is Jonsin'  for a pastrami sandwich and me thinks, that's not a bad idea. 

I can't read the menu up on the wall but what da hell can a pastrami sandwich cost.. I pick up a $2 can of soda ...

"Gimme a hot pastrami on Rye bread (don't toast it. "

I go to pay the bill with Apple Pay ---- $23 30.  

"$20 for a pastrami sandwich?  Cancel that."

Cashier: "But its got a lot of meat in it."

I take the soda to sit outside with my friends. Guy gets his pastrami sandwich to share with his wife and guess what? About the same amount of meat at Goldbergs'

 So you canceled the order after they made the sandwich? Man if I were an employee I would have been tempted to throw it at you. 

 who said the sandwich had been made already?

Well that was how I read it. Typically at delis you order, they make it and give it to you, then you pay. That's how it works at Millburn and Town Hall for example. Is your deli experience different? 

Smedley said:

Well that was how I read it. Typically at delis you order, they make it and give it to you, then you pay. That's how it works at Millburn and Town Hall for example. Is your deli experience different? 

 That’s how I read it also. He canceled the sandwich, and just had a soda.

Smedley said:

Well that was how I read it. Typically at delis you order, they make it and give it to you, then you pay. That's how it works at Millburn and Town Hall for example. Is your deli experience different? 

I've been to other delis where you order, you pay, and then wait for them to make your sandwich. It's not that unusual.

That being said, the cost of ingredients (especially meat) for the food service industry has been going up, because of supply problems. So don't just blame the workers who want a decent wage.

Smedley said:

So you canceled the order after they made the sandwich?

Man if I were asked this question and the answer was no I’d be tempted to throw the next sentence right back at you.

nohero said:

Smedley said:

Well that was how I read it. Typically at delis you order, they make it and give it to you, then you pay. That's how it works at Millburn and Town Hall for example. Is your deli experience different? 

I've been to other delis where you order, you pay, and then wait for them to make your sandwich. It's not that unusual.

That being said, the cost of ingredients (especially meat) for the food service industry has been going up, because of supply problems. So don't just blame the workers who want a decent wage.

 Who is blaming the workers? I don't see anyone blaming the workers. I see a discussion about inflation that has been generally dispassionate and apolitical. So I don't see any need to get all Cesar Chavez.  

“…So I don't see any need to get all Cesar Chavez.”

Ha!

DaveSchmidt said:

Smedley said:

So you canceled the order after they made the sandwich?

Man if I were asked this question and the answer was no I’d be tempted to throw the next sentence right back at you.

 I asked. If the answer is no the next sentence is rendered null and void. 

ETA: I would rather get hit by a sentence than a sandwich.