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.
I've calculated the cost of coffee in my house. Including the amortization of the coffee maker (say, 3 years), the cost of the filters and Starbucks coffee purchased at Costco. For a large travel cup (16-20 oz)... $0.10! (I did this a couple of years ago. With the inflation today, might be $0.12-$0.15/cup by now.) At "$8 friggin' dollars/cup", Starbucks might be the all-time best investment.
First noticed it in February 2021. A carwash sponge went up from $8.50 to $10. I asked why - "Inflation" came back the reply. Coulda ripped the greazy Salesperson over the Counter lol.
It is definitely the case.. but maybe that's how inflation works in real life, and not just through data lenses. When repeated constantly, people start to act accordingly and try and anticipate the effects - raise prices for your services, because other's will raise theirs and you are a consumer for everything else, might as well try to cover your costs this way - everyone else is doing it... I personally think it's going to go this way until at least the weakest and why not the weaker links are shaken out - people living at the edge of personal finances, people over leveraged in their business, in their lifestyle, in their spending habits... Until all of them are backed in the corner and stop being wasteful or irresponsible with their finances. How many people at what tax bracket drink how many coffees at $8 per coffee? There has to be an end to this, who is BUYING these premium prices ordinary products?
Between the $8 coffee, the avocado toast, and leased BMWs... it's no wonder folks can't afford to repay their college loans.
On Maui the car rentals went insane when tourism started to come back, the cheapest rental was $722 a day. https://apnews.com/article/travel-c...rus-pandemic-2acb757ca5677c1aac35cfff2593a4d8
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.
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.
It's trickle down economics. Big corp cries inflation on TV so store owner sees it and says, 'I'm going to trickle down this grift to my customers.'
I noticed it before the phony econ numbers started showing price increases. My data points were from shopping at Costco. The prices on various items that we routinely buy were going up $1 to $4. One example, the canned chicken we buy went up $2 initially and now it's up $6 a pack. The first jump was well before the Fed was saying anything about inflation. My wife was probably sick of me bitching about the prices going up. I think similar to college tuitions going through the roof as money was made easily available via the govs student loan program, the extra money they kept throwing out added to pricing power as people weren't changing buying habits because they were getting cash. (I'll add my pet peave, calling the government student loans "student aid" gave the impression to far too many people that it was free money, now they know otherwise) I'm not saying it wasn't necessary initially, but it probably needed to be reined in instead of expanded sooner. Also not saying the shut down and restart to the supply system wasn't a major factor also, but as it came back online prices have just kept going up. The worst part is the people who the money was supposed to help the most are getting creamed by the inflation, and will get creamed again as the economy collapses under the direction of the Fed.