The true costs of inflation in small-town Texas | Hacker News Reader

The true costs of inflation in small-town Texas

newyorker.com

164 pointsfortran77216 comments

I’ve seen some people showing actual price increases they’ve seen in their local communities. For a lot of folks it’s much higher than is being reported. Here’s one from a person in Seattle:

https://preview.redd.it/max54wqv9kb91.png?width=1112&format=...

I'm super skeptical of posts like this because they seem cherry picked, or at best, have local price increases that aren't reflected elsewhere in the country. Half of those are restaurants, who have had challenges for the past 2 years outside of inflation. Gas has its own challenges, a head of lettuce at my local grocer is $1.52 which is cheaper than that person's 2021 price. Notably not included in that post is things like pork, which has fell in half since 2 years ago, and beef has had 4 straight months of decreases. Car prices are also down too from their peak.

My point isn't that inflation doesn't exist. It's a very difficult number to compute. My point is that people on the internet aren't good at picking unbiased points to base their data on.

Data like this is good to understand how the cost of living is increasing in certain segments, but we all need to remember (I make this mistake sometimes too) that an increase in the cost of living is not inflation.

The term "Inflation" is used in two forms interchangeably by most people, and this leads to miscommunication. Inflation is used for:

(a) price inflation: increasing prices for individual goods.

(b) monetary inflation: an increase in the amount of money used.

Both types of inflation means you get less goods for the same amount of (in this instance) Dollars. Monetary inflation (b) is mostly created by central banks and commercial banks, who increase the amount of dollars via Quantitative Easing, or fractional reserve banking. Price inflation (a) is the effect of markets reacting to changes in supplies and macro trends.

Price inflation isn't even over all products, and products generally fall into three categories: deflationary goods, stable goods, and inflationary goods. Deflationary goods have traditionally been electronics like televisions. Innovation in these areas drives down prices for products hard. Stable goods are products like lumber, food, or oil. Inflationary goods are often luxury brand items like Gucci bags, or yachts.

What is noticeable now is a marked increase in price inflation for stable goods. The source of this inflation is usually one of the following:

1. Supply-side issues (Chinese harbours closed because of Corona outbreaks, the issue with meat as discussed in the article)

2. ESG goals driving up energy prices (which affect production costs and prices for fertiliser. A good example of this is Sri Lanka)

3. International sanctions against Russia (further increasing the cost for fertiliser and increasing the price of energy for the western European market).

My understanding is that economists use the term inflation for the rise in prices - strictly the fall in value or purchasing power of a currency.

The increase in money is termed 'expansion of the money supply'. There are a number of measures of money supply, going from narrow, cash only, to broad to include cash like instruments.

There is a strong relationship between money supply and inflation, different schools of economic thought understand it differently, but in general when you increase the money supply, its purchasing power falls.

Ballooning asset valuations have largely/entirely been caused by QE and ultra low interest rates, other prices are going to be affected by this too. Supply side shocks of course play their part, but current inflation is probably primarily driven by this loose monetary policy.

Let me add to your list:

4. Russia artificially limiting the Gas supply to freak out the Europeans.

5. Russia preventing wheat and corn feed from being exported out of Ukraine, forcing it to rot.

I'd also like to add to the list:

6. Many industries have become oligopolies, so companies can increase the prices consumers pay even faster than their own costs increase, leading to record profits.

For example, Tyson Foods' profits nearly doubled:

https://www.cnbc.com/2022/02/07/tyson-foods-higher-meat-pric...

Inflation is when the ratio of <money available>/<goods available> grows.

This can happen by the numerator growing (your (a)) or the denominator shrinking (your (b)).

A moment's consideration would show that's too simplistic. Money available has been growing for years without any notable inflation. It's not like we all rush out to spend every bit of income we have, a fair amount gets saved which effectively neutralises it.

So has the goods available. I suspect China's ability to manufacture cheaply and in huge quantities has masked a lot of the increase in the numerator.

A lot of the extra money was being plowed into real estate or the stock market, preventing inflation from happening elsewhere outside of the real estate or stock markets. Interest in saving accounts was too low for the money to just be saved.

<Money available> is a simplification, yes: https://en.wikipedia.org/wiki/Money_supply

Hate to be pedantic, but goods and services.

Seems like correlation more than causation. There could be plenty of money available but fearful people do not want to spend it.

> My point isn't that inflation doesn't exist

Heads of lettuce are really poor markers for inflation. What percentage of your take home do you spend on lettuce anyway?

You're much better off looking at median rent and median home price. Which can be quantified and clearly shows a big uptick. And you're likely spend anywhere from 25-50% of your pay on them.

Anything is potentially cherry-picked, but there's no question that superinflation is real now (inflation is really much higher than the officially reported), and we stand on the precipice of hyperinflation. Later this year, the dry, hot summer (that's just weather, folks, not global warming, but the timing sucks), in conjunction with skyrocketing costs of fertilizer, diesel fuel, and hay/feed will drive real food prices higher than they've been in the lifetime of all but our oldest citizens. Food will become a very significant part of family spending.

It's no better on the industrial side - I've got a client in light manufacturing (oilfield sensors) - they can't get critical components, they can't get wire, they can't get adhesives and chemicals. They can't even get some of the blocks of metal that they start machining with!

They have orders that have been sidelined waiting for parts for a year now. Most vendors have stopped quoting delivery and now just say "52+ weeks", since they have no idea when they'll have product to sell again. Their customers are furious, but they can't deliver what they don't have.

This cannot end well. Our economies, worldwide, have been deliberately destroyed in a very intentional set of moves that are not nearly over yet. This is going to get a lot worse before it gets better, unless there's a massive uprising. Canadian truckers and the farmers of the Netherlands are just the beginning of the unrest that's going to happen.

Prepare for something much worse than the Great Depression, because our governments sure appear to be colluding to make sure it happens. The only thing good about this is that social media and tech companies will be the hardest hit. People need food, they need manufactured products, but no one NEEDS Facebook... (We're already seeing people drop expensive unessential subscriptions (Netflix, etc.), and even seeing enough late payments to AT&T that they have to call it our in defending their falling earnings.) The Great Reset is here, and it's likely to turn bloody before it's all over...

beef has had 4 straight months of decreases

Even that’s uneven in my experience. Cheap ‘bulk’ meat isn’t up much, but ‘fancy’ meat (local, organic, grass fed etc.) is up over 30% where I am. Although I suspect that is at least partially due to “price gouging” the more price insensitive customers that buy that sort of product

My area has the inverse. Cryovac ground beef is way up but both the fancier stuff at the grocery store as well as the local stuff at the farmers market is roughly the same.

Hmm, I’m not in the US (Japan), but all prices have been rising. On top of that the yen went from 110 per $ to 140 per $, so that by itself inflates half of my recurring costs by 30%

I started my matcha addiction at the wrong time it seems. Just bulk ordered a bunch of tea from Japan, and while the dollar is relatively strong, it wasn't cheap. Still cheaper than Starbucks every day though, which is how I'm justifying it.

"My point isn't that inflation doesn't exist."

My wife tells me different, so I'm going with her real world experience in the matter.

If you or your wife look at the past and current price of lettuce in the local store and then use that to make the conclusion that the purchasing power of the US Dollar has decreased 47%, then I don't know what to tell you.

Your cost of living may have increased, but I do not understand how you can conclude an increase in inflation from living your daily life.

I know that my total grocery bill (not just lettuce) has more than doubled in the past few years. Gas too.

"The purchasing power of the US Dollar has decreased 47%" sounds about right.

A company selling a product I frequently buy went out of business, the purchasing power of the USD has decreased by 100%.

In terms of that product, it has.

And if that product was as essential to life for as many people as food and gas are, that might be important.

No it doesn't

You can always calculate your personal rate of inflation

https://www.destatis.de/EN/Themes/Economy/Prices/Consumer-Pr...

You could almost elect Walter Mondale with this amount of cherry-picked data

That seems massively susceptible to sampling bias. eg. are you really reporting all of your costs, or only the costs that you noticed going up? Meanwhile BLS provides regional CPI numbers[1], which puts "Seattle-Tacoma-Bellevue WA" inflation at 10.1% between Jun 2021 and Jun 2022.

https://www.bls.gov/regions/west/factsheet/consumer-price-in...

CPI has been engineered to meet targets for a long time. Several major flaws with CPI:

Hedonic adjustments are more or less at the mercy of the bureaucrats. For example, new vehicles did not go up in hedonic-adjusted price from 1997 to 2020 according to the BLS [0]. The justification is that new cars have bluetooth and other features that counter-act the price change. An automatic Toyota Corolla was $12373 brand new in 1997. It was $19700 in 2020. Our inflation numbers over those years did not incorporate a price increase AT ALL, so it's a fair assessment that real inflation was higher based on that alone. The Big Mac index has probably always been the most accurate assessment, free of political pressures.

And the most fundamental problem: the survey evaluates the median spending of a sample of Americans, but the median American spends pretty much all of their money. So you end up with the dotted line in this chart: [1]. Spoiler, it's pretty much a flat line. Real median wages don't move because CPI is calculated by measuring median wages. If prices rise, people can't <consistently> spend more than all of their money, so they buy cheaper things and buy less of them, and this changes the weights and reduces the inflation numbers. The fact that some economists with PhD's think this makes sense is why you should always do your due diligence instead of accepting a doctor's diagnosis blindly.

[0] https://fred.stlouisfed.org/series/CUUR0000SETA01 [1] https://www.bls.gov/charts/usual-weekly-earnings/usual-weekl...

I agree in general about the hedonic adjustments and their potential for manipulation or miscalculation. But automobiles are probably the worst example!

Toyota didn't even roll out passenger side airbags until 1998. Only the driver had them prior to this. The new Corolla has 8 airbags. Today we have better fuel efficiency, collision protection, driver assistance, remote start... Even the seats are more comfortable. Not to mention most car brands have much better warranties today than they did in the '90s.

Other things get hedonic adjustments but shouldn't. Shirts for instance.

But it's irrelevant when that's the cheapest new vehicle, most working Americans need a car, and despite better fuel efficiency, it isn't really that much cheaper to own a car. Hedonic adjustments make sense in theory, but in practice it's a loophole to make inflation whatever the government wants it to be. In the case of vehicles, they clearly went overboard. The counterargument to hedonic adjustments is that almost everything should become cheaper over time, including all vehicle parts and assembly, due to technological progress in manufacturing. I don't think it's unreasonable to assume hedonic adjustments should cancel out increases in manufacturing technology and just ignore them both, probably resulting in a simpler AND more accurate CPI.

> But it's irrelevant when that's the cheapest new vehicle, most working Americans need a car, and despite better fuel efficiency, it isn't really that much cheaper to own a car. Hedonic adjustments make sense in theory, bpractice it's a loophole to make inflation whatever the government wants it to be.

The average new car in the US lasts like 2x longer than it did in 1998. Shouldn’t that factor in?

“The average new car in the US lasts like 2x longer than it did in 1998. Shouldn’t that factor in?”

Absolutely not. Where do you stop with this game? Do you factor in that the seats are better so people go less to the doctor for back pain?

“I pay $30k for something I have to buy once every 10 years and that is ‘inflation’ vs. paying $20k for something I have to buy every 5 years”

I mean, I really struggle to follow your logic.

If a paper towel roll has 2x the sheets but costs 1.5x more, is that inflation too?

A lot of people buy a car every n years. For them it doesn’t matter if it lasts longer. How do you quantify how much longer cars last? Maybe people use them longer because cars are better or maybe they use them longer because they can’t afford new cars.

The paper towel is a bad example because you clearly can quantify the number of sheets. It gets more tricky if you say new paper towels are more absorbent so you need less so there is no inflation although the sheet costs more. How do you measure that? These metrics are way too easy to be gamed. Next is apples costing twice as much but they are crunchier so no inflation?

> A lot of people buy a car every n years. For them it doesn’t matter if it lasts longer.

You can’t just keep randomly changing the relevant populations. First it was working people who can’t afford a breakdown. Now it’s wealthy people who choose to buy cars regularly. Maybe that’s why it’s difficult to grasp inflation: it’s a basket of everybody

> How do you quantify how much longer cars last?

https://ihsmarkit.com/research-analysis/average-age-of-vehic...

> Maybe people use them longer because cars are better or maybe they use them longer because they can’t afford new cars.

You’re implying that people used to junk old cars because new ones were so cheap? Interesting take.

> The paper towel is a bad example because you clearly can quantify the number of sheets

I can also literally quantify how much longer cars last (see link above).

> It gets more tricky if you say new paper towels are more absorbent so you need less so there is no inflation although the sheet costs more.

Yeah, you know inflation takes a basket of spend into account, right? So yeah if in a year, the average consumer buys half as many paper towels that cost 2x as much that is exactly “no inflation”.

> These metrics are way too easy to be gamed. Next is apples costing twice as much but they are crunchier so no inflation?

I really suggest you read up more on the thinking behind inflation if you’re going to have such a strong opinion about it. Apples being crunchier is not accounted for in hedonic adjustments [0]. Like literally. Go to FK011

[0] https://www.bls.gov/cpi/quality-adjustment/home.htm

EDIT: Learn something new I guess. Cars aren’t even subject to hedonic adjustment. They have their own adjustment system that seems pretty fair if you read it[1]

[1] https://www.bls.gov/cpi/quality-adjustment/new-vehicles.pdf

I think the original poster's claim of lasting twice as long is a big exaggeration, but it'd be interesting to see a source. Regardless, cars are likely more expensive to maintain now with all of the added complexity / sensors that can break (remember when everyone could work on their own car? I bet they didn't factor that negative into hedonic adjustments.)

Surprisingly only a little!

The USDOT tracks this! That’s why cars are such a bad example.

In 1998, the average age of a car on the road was 8.8 years. [0]

In 2022 it’s 13 years. [1]

Factor in install-base effects and the multiple probably rounds to 2x

[0] https://www.bts.gov/content/average-age-automobiles-and-truc...

[1] https://www.carscoops.com/wp-content/uploads/2022/05/SP-Glob...

That's actually a pretty big difference compared to the OP's claim, AND note that this statistic incorporates a delay (we are comparing 1990 vehicles to 2009 vehicles instead of 1998 to 2020). Granted, we don't know how long 2020 vehicles will last yet. The final caveat being the second point I made about people holding onto their cars longer as inflation rises / changing their preferences, not necessarily because the cars are holding up better.

> The final caveat being the second point I made about people holding onto their cars longer as inflation rises / changing their preferences, not necessarily because the cars are holding up better.

I’m sorry but the idea that “we used to junk cars sooner because new cars were cheaper” is a very big stretch to support your bias (much moreso than the concept of hedonic adjustment)

> we used to junk cars sooner because new cars were cheaper

This is not obvious to you? Look at how many things (especially plastics and electronics) are wasted today while they still function because they are so cheap. How many times have you replaced your smartphone while it still worked fine?

The point, again, is that we can do reasonable mental gymnastics to more or less counter-act any hedonic adjustments (which were also mental gymnastics to make inflation seem lower in the first place). A better metric would involve fewer loopholes like this that allow arbitrary mental gymnastics in the first place and instead say "how much does an entry level vehicle cost, amortized with upkeep costs and fuel for the average American." There should be no adjustment for better airbags or bluetooth, nor a reverse adjustment for taking into account improved automation in factories.

> This is not obvious to you?

It is very much not obvious to me because it’s not true. Critical safety features like airbags (required by US law in 1999) and ABS (required by US law in 2000) were not standard in cars back then, which is a huge incentive to junk a car.

Since then, mandatory safety features include traction control (2011) and backup cameras (2018), and idk about you, but I’m fine driving a car without Either of those things, but not ABS or Airbags.

Honestly, if you’re going to have such strong opinions about cars, maybe do research into them.

And to your amortization point, literally amortization means “cost over useful life” so we agree?

And please look at the link on my other comment [0] because that is not how car prices are adjusted by the BLS

[0] https://www.bls.gov/cpi/quality-adjustment/new-vehicles.pdf

It's possible to have many correct points but miss the forest for the trees/argue past each other. I didn't mean that last comment to be condescending, by the way.

To my original post (the second part), the BLS primarily measures the spending of people who never save a substantial portion of their income. Vehicles are a necessity for most of these people, so they are going to stretch out the lifetimes of their vehicles if the prices increase relative to their wages. Furthermore, people who might have bought a Camry with some upgrades in 1998 might be relegated to a stock Corolla in 2020. Sure, things are getting nicer all the time, but it's getting easier to make things all the time, too. Technology goes both ways, and at the end of the day, it's still a car. If they took out the rear airbags and removed all of the cheap microcontrollers, would the price really drop 40%?

The way the BLS does its survey does not account for preference changes due to price increases. When wealth inequality is constant, it's probably a decent measure. But even then, it's a political metric and the Big Mac index is the best, simple metric we have for true inflation (which has been consistently higher than CPI for decades).

Do you think most people wouldn't get new cars more often if they were free?

Yes, that sounds like a good idea if what you're trying to estimate is the cost of maintaining a certain quality of life.

If you push this far enough then you can argue inflation away from almost anything.

So what? The goal of measuring inflation isn't to compute the biggest, scariest number, it's to track changes over time.

If anything, shirts should get negative hedonic adjustments as the quality of the fabrics and craftmanship decrease. But I’m guessing negative hedonic adjustments isn’t a thing.

Yeah, like many other things. Tomatoes of today do not smell and have no taste. Nobody would buy such tomatoes 40 years ago even for half the price.

> the survey evaluates the median spending of a sample of Americans, but the median American spends pretty much all of their money.

I feel like this is relevant. If you already don’t save anything, then your spending power decreases drastically over a year or two, you still spend all of your money but just buy fewer of the nonessential or “nicer” things.

So CPI adjusts and assumes that “this is normal spending now”, but really there was no flexibility in someone’s spending anyways.

They would’ve kept buying more if they could, but now their quality of life has decreased but CPI treats it as if the product has improved & they don’t need as much anymore (even as a QOL increase).

Am I understanding this correctly?

That was my interpretation when I first read the detailed process about the BLS survey.

It will still measure inflation, but if the median American's spending preferences changes when prices change (which is true until the median American can never afford anything except the bare necessities to begin with), then those changing preferences will result in falsely lower inflation numbers. Combined with Hedonic adjustments, true inflation has probably been about 50% higher than reported for the last two decades (and more in line with the Big Mac index) [0].

[0] https://medium.datadriveninvestor.com/what-do-big-mac-prices...

The CPI is well thought out, though it's possible that their choices on weighting don't match your own spend.

Some detail here: https://www.bls.gov/cpi/tables/relative-importance/2021.htm

People don't seem to grasp that 9% inflation is extremely high across an economy as large as the US. The 70s had 15% inflation, everyone with their rage boner demanding 50% inflation in the CPI wants ridiculous reports of hyperinflation.

Well, and 9% YoY, where the previous year was also up ~7% from its own previous year. The magic of compound interest and all.

Yes! And a lot of people forget that, but I calculated it and the average spending increases I've been seeing in my household are up more like 15% YOY over the last 2 years. And that coincides with a significant reduction in consumption on our part as well as substitution for cheaper goods over that same period.

If the CPI does not match people's spending habits, then it does not matter if it well thought out or not because it is a bad metric.

Looking at the table, Energy(CPI-U 7.348%,CPI-W 9.029%) looks to be massively undervalued. Everything in our modern life, from food and clean water to our leisure activities require energy.

Last year I could buy a whole chicken for roasting for about $10. Now they are $17 or so. 70% increase. Beef the same. Pork hasn't jumped as much for some reason. Ground turkey is about the most affordable meat I can find right now, but when you cook it you can see that it has a lot of water in it.

This is where I'm always curious to see what other dynamics are going on in other places, I don't know how else to say it except that has absolutely not been my experience. In live in just normal midwest suburbia, so if there's places living with that, I should really count my blessings I don't.

With a lot of these things nowadays, I've been looking at my receipt data and rooting through FRED, and obv the absolute numbers are probably not going to be bang-on, but the percentages are definitely pretty similar.

So yeah, it's not fantastic, but FRED data for chicken, beef, sirloin is like 20%, 26%, 51% in two years, which agrees pretty well with what little data I personally have, or their estimate is a fair bit higher for the sirloin (also prob hard to estimate since I wouldn't treat it like as much a commodity as ground beef). Milk is a similar story, FRED has like 40% in two years, knock on wood I don't think I've observed that, but dairy might be a midwest speciality for these purposes.

whole chicken, beef, sirloin. https://fred.stlouisfed.org/series/APU0000706111 https://fred.stlouisfed.org/series/APU0000703112 https://fred.stlouisfed.org/series/APU0400703613

Avian flu resulted in mass culls.

Feed prices also higher due to Ukraine/grain shortages increasing demand for grain.

The very real price increases you are seeing are driven in part by very specific and focused economic shocks which exceed the baseline macro-level shock (officially measured at circa 10%, with all the caveats around that measure)

Thanks to buying almost everything from Amazon, I get a nice record of exactly how much I spent and can compare to the price being offered today, so I'm going to do that. I'm just going to go to 2020 and see what I can find:

- Topo Chico 24 pack of 12 oz glass bottles: then $20.99, now not available (damn shame because it's my wife's favorite drink, but these seemed to disappear in the pandemic and never came back)

- Chameleon cold brew coffee, 32 oz: then $9.99, now $8.36

- Fire 7 HD tablet for my niece: then $99, now $139 for the Fire 8

- Optimum Nutrition Whey Protein, 5 lbs: then $58.64, now $59.36

- A wireless keyboard: then $29.99, now $27.99

- Deep conditioning hair mask: then $25.00, now $25.55

- Organic Valley heavy whipping cream, 16 oz: then $4.79, now $5.69

- Set of 3 floating shelves: then $14.99, now $13.69

- Fage full-fat greek yogurt, 32 oz: then $5.49, now $5.99

- 1 pint organic blueberries: then $4.49, now $4.49

- 2 pack of 3.4 oz Sensodyne toothpaste: then $20.48, now $12.79

- Cabinet mounted USB fans, 12": then $39.99, now $39.99

This isn't cherry picked in any way, not pulling from memory or looking back after sticker shock. It's just everything I bought in December 2020.

All of the price changes in my retail purchases are meaningless when compared to price increases in land, healthcare, education, and taxes since I started working in mid 2000s for the location I lived / wanted to live in.

Daycare has more than doubled, $20k+/year increase for 2 kids, land is hundreds of thousands more. How much price changes have affected you are very dependent on what resources you were/are aiming to buy and who you are competing against to secure it.

I'm always curious for some of these how much it's just a problem of round numbers. Something like the vet visit, I totally believe, but marking down the $1 increase in airport parking cost feels like it's less a percentage and more that they just added 1 to the number because making it cost 36 cents more would just be awkward.

Not that that doesn't cause a problem for the people paying it, but pricing for relatively cheap items is a coarse instrument. If you're a business owner and you have no idea how long inflation will be this high, you maybe just err on the side of pricing in some future price increases now and raising prices more in one go vs. changing them every couple weeks. Most consumer goods aren't like gas where people just expect the price to go up and down constantly day to day.

I’ve just done that with a selection of products I commonly buy (Germany). 2021 is January till March, 2022 is from July.

https://i.imgur.com/suESNqF.png

Rather painful to see, no idea what happened to Almonds though, maybe they were extra expensive in 2021. I skipped both cauliflower and celery sticks because prices fluctuate wildly for both. I left out meat as well, but ground beef almost doubled in price.

I'm assuming there are many things in that person's basket of goods which did not change in price at all, and many others that did not change in price as much.

Housing makes up 37% of the basket. It's noticably absent. And it's measured... Interestingly.

Lasagna at a restaurant is just a small part of food away from home which makes up <6% of the basket...

https://www.bls.gov/cpi/tables/relative-importance/r-cpi-e-2...

In Australia you would need to double those prices, to be on the low end of prices.

Maybe we earn more money?

An Australian dollar is worth ~30% less than a US Dollar, which explains part of it.

The median income in Australia is higher than in the US, yes.

For context, I live in San Saba and Lampasas, TX. San Saba is located two hours northwest of Austin where the population density is three people per square mile.

While there is truth to the story about inflation hitting rural, poorer areas the hardest, this gentleman's quotes are a but of a stretch.

> Brisket went from one sixty-nine a pound to seven

Brisket has not been $1.69 for years, unless this gentleman has some sort of sweetheart deal. Also, I show that HEB's market price for brisket today is between $3.05/lb and $5.14/lb. [0]

> “In Texas, in all two hundred and fifty-four counties, you can go get barbecue—that’s what we could lose,” she said.

It seems that this person is saying we could lose BBQ in all 254 counties in Texas? That's unmitigated hyperbole and balderdash.

> “We’ve had a handful of customers that have been here from Day One, every morning. Drinking coffee, a lot of times ordering the same taco.” When the restaurant opened back up at 7 A.M. on Thursday, only two of the seven morning regulars showed up. “It brought a tear to my eyes,” Rodriguez said. “Like, man, am I losing it? I’ve put too much work in here. I’ve worked so hard to want people to come in here. And now I have it, and I’m having to shut the doors.”

This is a great example of a writer trying to prove a point without stopping for a moment to make sure that they were being truthful in their accounting so as to avoid being disingenuous. This is a very teachable moment for this writer, and others.

Absolutely, inflation hurts. For example, I know that small town governments who provide the critical infrastructure for their communities drive the equivalent of an F150 and the increase in gas prices strains city budgets, which may only be $1M per annum. Will they get by? Absolutely, because self-reliance is baked into their existence, the community rallies and supports its own, or they couldn't continue to live and survive in such remote environs.

To address the author's original question, will the local county BBQ joins in Texas survive inflation? It will hurt, but of course they will survive. Texas BBQ will never go away.

[0] https://www.heb.com/category/brisket/338579

> It seems that this person is saying we could lose BBQ in all 254 counties in Texas? That's unmitigated hyperbole and balderdash.

I interpreted this to mean that BBQ is available in all of the counties in TX, and that may no longer be true in the future, since some rural counties may lose their last BBQ joint.

Additional context: there are many big, nearly-empty counties in West Texas that, frankly, should be completely empty, and I say that as someone whose maternal grandparents were born and grew up in Swisher County (Tulia and Happy), and whose dad now lives in Kent County - where a grand jury summons meant the prospect of 160 mile daily round trips because the county seat is on the north side of the county but he lives in the southwest corner, and the Panhandle's one lake of note being in the way means he has to drive a long ways around it. Kent County has about 1000 residents, and there are several other sub-1000 resident counties.

This also leads to fun effects like laws that each county can only have one ballot drop-off spot: sensible for those counties with fewer residents than many of the University of Texas dorms; a ridiculous nightmare for Dallas, Travis and Harris Counties (but that was kind of the point).

Are you not allowed to return ballots via the mail?

I would like to know which they are. I just don't see that as a thing that can happen.

If you think a Texas county may lose their BBQ producing capacity, please let me know as this would be most newsworthy and also deserving of every Texans' help.

That's a quote from Emily Williams Knight, the president of the Texas Restaurant Association, previously published in the Wall Street Journal:

https://www.wsj.com/story/dreams-of-inexpensive-texas-barbec...

Of course, authority doesn't necessarily make something true, but it deserves a better counterargument than: "I just don't see that as a thing that can happen."

It is certainly hard to imagine losing something so central to a culture, but the financial plight of small town America is quite dire. Sometimes people have to give up things they love when they just can't afford them anymore.

Statements with the word 'never' should immediately be dismissed, especially when you're being as pedantic as you are in your above argument.

If I dissect your points with the same gusto as you dissect the article's:

> It seems that this person is saying we could lose BBQ in all 254 counties in Texas?

Not what they're saying, they're saying some could be lost which would mean BBQ would not be available in every county.

> Brisket has not been $1.69 for years, unless this gentleman has some sort of sweetheart deal.

Comparing wholesale prices to HEB makes no sense. I also can't get 150 eggs for that price.

> Texas BBQ will never go away.

The hubris in this statement is unbelievable! Why do you think BBQ of all things is immune from societal changes? Countless foods and other cultural activities have been lost over generations due to even more reasons. I find it funny how your wording makes BBQ sound like the last bastion of civilization that should be defended!

I get the skepticism, but the response is a bit over the top for what's being talked about. It's just BBQ, they're having a rough time, we might lose some businesses.

> Absolutely, inflation hurts. For example, I know that small town governments who provide the critical infrastructure for their communities drive the equivalent of an F150 and the increase in gas prices strains city budgets, which may only be $1M per annum. Will they get by? Absolutely, because self-reliance is baked into their existence, the community rallies and supports its own, or they couldn't continue to live and survive in such remote environs.

A ridiculous tautology. They will continue to exist because if they couldn't they wouldn't? Self reliance is baked into their existence? Please.

Let's do a check: https://reportingtexas.com/amid-population-decline-rural-tex...

> Despite Texas gaining more people than any other state in the past decade, more than half of its counties lost population, according to the 2020 U.S. Census.

> During the past few decades, changes in agriculture and the boom-or-bust oil and gas industry have led to dwindling employment opportunities in rural Texas. Many young people leave rural communities after high school in search of economic and social opportunity, often never returning.

These towns are hurting badly. They're not going to survive by gritting their teeth.

People have been migrating from rural to urban areas for hundreds of years. That has little to do with inflation.

It has to do with economic pressures which make rural living harder and urban living easier. Inflation is one of those pressures.

> > “In Texas, in all two hundred and fifty-four counties, you can go get barbecue—that’s what we could lose,” she said.

>It seems that this person is saying we could lose BBQ in all 254 counties in Texas? That's unmitigated hyperbole and balderdash.

No, he's saying that today you can go to any of the 254 counties in Texas and get BBQ, but in the future you may only be to do so in some.

> This year, Tyson Foods, the country’s largest meat processor, saw its first-quarter profits nearly double. Meanwhile, all over Texas, barbecue places have shut their doors: Two Sawers BBQ, in Floresville; 1836 BBQ, in New Braunfels; Brisket Bar-BQ, in Bellaire.

Kinda curious what the long term plan is here for Tyson -- just sell directly to customers after all the restaurants have closed, I guess?

It's misleading to talk about profits purely in absolute terms. The profit margin could stay the same while the absolute number doubles.

If you make $10 profit on $100 revenue one year (a 10% margin) and $20 profit on $200 revenue the next year (still a 10% margin), profits "doubled" but the profit margin stayed the same. When you add in the inflation and the fact that the $20 this year is not worth as much as $20 was last year, it's not even a real doubling in absolute terms.

Inflation will produce "record highs" in terms of absolute number of dollars in all sorts of things, but if you don't account for the fact that the dollars are not worth the same amount as before it's disingenuous.

Your hypothetical is of course possible and good to keep in mind, but in this case:

https://www.meatpoultry.com/articles/26162-tyson-foods-repor...

Compared to 2021:

It looks like they increased the price of beef by 31.7%, sales decreased by 6.2%.

For chicken, they increased the price by 19.9%, and sales increased 3.6%.

It is possible I'm misreading things though, I'm definitely no economist.

> Adjusted net income for the fiscal first quarter was $1.12 billion, a 140% increase from $467 million, reported in Q1 of fiscal 2021

> Operating income more than doubled from $705 million for the first quarter of 2021 to $1.45 billion in fiscal 2022.

> Sales for the quarter were $12.93 billion versus $10.46 billion during the same period in 2021, an increase of nearly 24%.

In any case, if people have decided to replace beef consumption by chicken consumption -- economically I guess it is probably a little worrying that people feel the need to switch to the cheaper meat, but health-wise it is probably a win. So, silver lining!

The missing piece here is how much did costs increase? Are the costs maybe slower to catch up due to locked in prices and they raised to consumers earlier? We'll see. I wouldn't expect these record profits to hold.

It's a public company so no need to say it's misleading and hypothesize. Q1 sales up 23.6% (volume +0.3%, so all price), NI up 140.0%, and net margin up 94.1%.

Source for the numbers? The only relevant one is profit margin, which is up 0.43%, which is not material.

https://www.macrotrends.net/stocks/charts/TSN/tyson-foods/pr...

Dec 2021 profit margin - 7.47%

Mar 2022 profit margin - 7.90%

Dec 2021 net income (profit)- $1.121B

Mar 2022 net income (profit) - $829B

Sure, but someone loses, and in this case the loser is the local restaurant that doesn't appear to have much pricing power.

Just means the restaurant wasn't very good to begin with. Chipotle, McD's, etc. have all raised prices nationally, and they operate in what has to be the most price sensitive market possible. I know the good restaurants in my area have doubled prices and people keep coming because they're the best.

Rising prices differentiate the good businesses from the bad.

> Just means the restaurant wasn't very good to begin with.

Or that the local market won't support higher prices. Some communities just don't have the disposable income to spare.

And even McDonalds is closing stores:

https://www.statista.com/statistics/256040/mcdonalds-restaur...

You are talking about a fundamentally different situation than the article, and than a lot of areas face. “The good restaurants in my area.” That implies a much larger selection than the typical small town, where there’s likely a McD’s but not a chipotle.

And as was already stated, the buying power in these towns tends to also be lower, maybe fluctuating due to tourists but nowhere near a city’s average. Your “people keep coming” and “doubled prices”comment suggests a much higher level of disposable income.

And throwing out corporate chains as part of this? The franchises are just tiny pieces of the whole. There’s a whole massive machine watching each limb, supplying it, and sometimes amputating it. Which, yet again, compare that to a mom and pop, it is nowhere near the same.

If you haven’t been to a small town, you should visit a few. Your disposable income would be welcome in a lot of great restaurants that are still struggling. A lot of not so great ones as well.

It sounds like the restaurant was a side project that was barely solvent to begin with. They could try raising prices, but if the customers leave then people simply aren't willing to pay what it costs to keep that place open and the demand to support that restaurant in that place just isn't there.

> It sounds like the restaurant was a side project that was barely solvent to begin with

This is an incredibly bad take.

Restaurants are a grueling business and many have low margins — 80% fail within 5 years. Since the beginning of the pandemic many incredible and beloved restaurants in my city have been forced to close due to lock downs, landlords raising rents, rising costs, etc.

> They could try raising prices, but if the customers leave then people simply aren't willing to pay what it costs to keep that place open and the demand to support that restaurant in that place just isn't there.

If customers are sensitive to higher prices, it's probably because of record inflation and economic downturn limiting their disposable income.

Nowadays the only establishments with stability are chains: McDonalds, Starbucks, Burger King... places that for the most part only care about profit and neither pay or treat their employees well, or have good quality food. A city without diverse locally-owned restaurants is a bleak prospect.

> Throughout most of R-BBQ’s existence, Rodriguez has worked other jobs as well, first at the health clinic in town, then at the school district. His heart was in the restaurant, but he was cognizant of his father’s railroad pension and the stability it provided.

It says right in TFA article that the owner works other jobs to support himself. No doubt restaurants are a tough business. Lots of businesses fail. Should we subsidize every business in existence that can't make the economics work on its own merits?

I'm sorry people will lose the restaurant they love so much, but apparently not enough to pay the higher prices it would take to keep it open. Times change, economic conditions change, businesses come and go. That's a natural part of the economy and life. Things don't last forever, especially if you're unwilling to face reality and do the things that are necessary to make them last.

> Since the beginning of the pandemic many incredible and beloved restaurants in my city have been forced to close due to lock downs, landlords raising rents, rising costs, etc.

Yes, I've heard of many of these. It's always a person who went to the place once 2 years ago and is sad now that it's closing. Guess what you can do to keep local restaurants open? Go to them and buy food!

> It says right in TFA article that the owner works other jobs to support himself.

Both bee_rider and InefficientRed's comments were clearly about the general effect and not the specific restaurant mentioned in the article.

Regardless, the fact that Rodriguez has to work another job to support himself doesn't make it a 'side project'.

> Yes, I've heard of many of these. It's always a person who went to the place once 2 years ago and is sad now that it's closing. Guess what you can do to keep local restaurants open? Go to them and buy food

Are you really disregarding the content of my post because of a made up scenario that you're attributing to me?

In 2020 a beloved Syrian cheese and dessert shop, owned by a refugee, was forcibly evicted because their land lord tripled their rent. The lot remains vacant to this day. Was this personally my fault for not buying enough cheese?

> In 2020 a beloved Syrian cheese and dessert shop, owned by a refugee, was forcibly evicted because their land lord tripled their rent. The lot remains vacant to this day. Was this personally my fault for not buying enough cheese?

Obviously every single instance of a restaurant closing is not going to be the same. Maybe the landlord hates Syrians. Maybe they're negotiating a deal where Starbucks will pay triple the rent for a 10 year NNN lease that will make more money even with the vacancy, maybe it's a money laundering front for the Russian mob, who knows?

I'm sorry your favorite cheese shop closed and it was probably not personally your fault for not buying enough cheese. Maybe you just live in a town that does not have enough cheese loving people to support a cheese shop, or there are uniquely evil landlords who have a vendetta against immigrant hard-luck stories. Sometimes businesses we like close. It happens.

Hey, I never said it was _my_ favourite!

Anyway, my point is that only focusing on the 'logic' and numbers misses the point. The myopic focus on short-term profits hurts the average person and their communities.

You asked in an earlier comment if we should "subsidize every business in existence that can't make the economics work on its own merits?" I am not necessarily saying that we should, but we ought to acknowledge that the economy is not a system based on merit. In addition to blatantly profiteering, many large companies have taken trillions from programs like PPP loans that were meant to protect jobs, and proceeded with layoffs or stock buybacks instead. That money not only comes from you and I, but it also affects our communities — people lose their jobs, and the record profit are shuffled away into tax havens.

Does the world _need_ a specialty cheese shop? No. But the larger collapse of small, locally owned businesses since 2020 is a worrying trend.

I mean I don't know if you'be been out eating any time in the previous 6 months, but fast food is no discount. Most mom-pop places comparable or cheaper than fast food.

I completely agree: in my neck of the woods, a breakfast combo at McDonalds now costs more than the incredible mom & pop places nearby. The problem is convenience and access.

Fast food chains are ubiquitous and designed to be a quick and predictable choice for people. Mom & pop places don't tend to have large parking lots, or drive-thrus that people can line up around the block for. They also can't afford the margins that UberEats or Doordash take — and food delivery has exploded in the past few years.

Lastly, many people are creatures of habit and few are probably looking to shake things up right now. The unfortunate truth is that the best value or quality seldom wins these days.

mcdonalds in particular seems to have deliberate price discrimination. if you go in and buy one of the prominently featured combos, you could end up spending over $10. on the other hand, ordering from the dollar menu and using discounts through the app, you can get a lot of food for not much money. today I got two mcdoubles, large fries, and a soda for $3.50. I dunno where you would find a cheaper ~1200 calorie hot meal.

There are no capitalists in foxholes. Stop voting for neoliberal vampires (i.e., Democrats) and small business tyrants (i.e., Republicans). If people want price controls, vote for social democrats and communists. If none are running where they live, run for office on monopoly busting and price controls.

>It sounds like the restaurant was a side project that was barely solvent to begin with.

It's actually hilarious how downvoted this comment is, considering how close it is to another sentiment that's actually popular (ie. make the same point, but make it about labor costs rather than evil corporations raising prices. Both are based on the claim that if a business isn't profitable enough, it shouldn't exist in the first place.

> Both are based on the claim that if a business isn't profitable enough, it shouldn't exist in the first place.

I think a little bit of empathy goes a long way. The past few years have wreaked havoc; many people and businesses are struggling to stay afloat. Coldly repeating the mantra that small businesses failing (many for reasons outside their control) is just 'the economy' is rubbing salt in the wound.

Even in the best of times, many great businesses weren't profitable for several years.

Tone matters. The comment people don’t like comes across as really callous.

I believe the implication is that if everyone collectively agreed to eat the inflation – go from 10% margin to 5% margin for the same $10 – there would be a lot less inflation because purchasing power would be the same regardless of what some number on a computer says.

But if everyone raises prices “because inflation”, well that’s exactly what inflation is – things getting pricier.

I know this sort of coordination can’t happen. Point is inflation is a trailing measure of price changes. Without price changes there is no inflation. People set those prices.

It’s just cost-plus pricing. Tyson needs to tie up money in inputs, production, and distribution—money that could be put to work elsewhere.

Now apply that to workers wages. Can guarantee those haven't 'doubled' regardless of the method used to calculate it.

They should plan on being broken up. Way too much consolidation in meat processing has been allowed over the past few decades. According to Matt Stoller, cattle prices haven’t increased, though retail prices have: “But since 2015, the ‘meat margin’, or the spread between the prices ranchers get for their cows and the prices consumers pay at the supermarket, has widened dramatically. Despite high consumer prices, independent ranchers are losing money, and going out of business.“[1]

[1] https://mattstoller.substack.com/p/economists-to-cattle-ranc...

Except Tyson’s net income margin is like 7-8%, so ask yourself if Tyson acted as a nonprofit going forward and sold everything at ~7% discount, would that change anything? (Personally I don’t think it would)

Why not? Profit margins are up, but overall sales volume was also up 25%. If they can make more money by selling more product, why stop?

https://www.cnbc.com/2022/02/07/tyson-foods-higher-meat-pric...

Your statement is incorrect. Their sales volume was flat (up 0.3%), not 25%. The rest of the sales increase was price. Also, that's from Q1 (reported in February) so a bit old. Q2 (reported in May) saw a 16.1% increase in sales, with volumes down 1.5% and price up 17.6%.

Higher margins is exactly what we would expect in a supply constrained environment. Demand outstrips supply, so businesses can raise their prices without leaving unsold products. The natural temptation here is to enforce price controls or whatever, but they come with their own problems. If demand is outstripping supply, price controls would lead to empty shelves/rationing.

> Higher margins is exactly what we would expect in a supply constrained environment... The natural temptation here is to enforce price controls or whatever, but they come with their own problems.

Or in markets with limited effective competition, no? In which case breaking up businesses is another option.

They are raising prices because demand is sky high. They have no shortage of customers even with raising prices. Inflation is largely demand-driven with a few key supply constraints thrown in to make things worse.

Whittle down the customers who cannot pay a premium and sustain large margins. Brex did that with its small business accounts.

The article presses only a single hypothesis (food input costs going up), but I don't think the article addresses the other side of balancing the books: it may just be a substantial drop in customer traffic to restaurants, even before price changes.

It does seem that publicly-traded restaurants are being impacted far more than meat suppliers:

https://totalrealreturns.com/s/TSN,CMG,MCD,QSR,DRI,BLMN

I think the "Total Real Drawdowns" chart is decently instructive. See the huge dip in March 2020, then the general hopeful recovery of June 2021. Compare the red line (Tyson Foods, from the article) versus all the restaurants. With the exception of McDonald's, the restaurants are fairing worse. Would have to dig into fundamentals to get a better sense of why.

> The article presses only a single hypothesis (food input costs going up)

It also talks about gas prices, which affect a cook who quit and a customer with a lawnmowing business.

Half the article discusses other factors? 1. staff shortages 2. very elastic customers 3. climate change.

> a box of a hundred and eighty eggs, which had cost around eight dollars when he opened the restaurant, in 2001, was nearly fifty.

I don't think I've seen wholesale eggs even close to that high at any point. I think the only place I've seen unit prices that high is at a Whole Foods (which is organic, not wholesale, and has a "premium brand"/convenience markup). Are eggs just outrageously expensive in the Texas market at the moment?

At my Costco the 180 box is just under 40 with tax, and thats for the medium eggs. If you want large its $60 for the box. So this seems believable…

HPAI LOSSES PASS 38 MILLION BIRDS https://www.agriculture.com/livestock/poultry/avian-influenz...

Signs of avian influenza include: birds dying without clinical signs; lack of energy; decreased egg production; soft-shelled or misshapen eggs; swelling or purple discoloration of the head, eyelids, comb, and hocks; nasal discharge; coughing; sneezing; incoordination; and diarrhea. The USDA has a resource with images to help identify discoloration and other clinical signs.

Large vs. Medium eggs - also a chance for a shrinkflation serving without removing 50% of the serving.

How are they that much? I pay $1.49 for 18 eggs at Kroger

Those must be really low quality eggs? The Costco ones are not quite the bottom tier.

Eggs can be hyperlocal - we were as low as $.25 a dozen just a few years ago, now we hit about $2 a dozen. The eggs from further away are more - the latest price increases have made the "grown local by cage free hens" eggs competitive again.

Eggs at my Costco were $8-9 for 60 large a couple weeks ago.

Australia. I pay $5.50 (US$3.80) for a dozen large free range. So about $60 for 180. But free range! Retail!

About the same price over in Massachusetts. Note that in the US if you want what's considered free range in most of the world you need to buy "pasture raised". "free range" is an awkward middle step.

Normal eggs are about half price, and MA has some regulations in place the limit the abuse of chickens more than other states.

Short-term profit seeking behavior leads to companies raising prices far more than they should while keeping wages stagnant. So they raise the prices on food and other common goods, consumer buying power goes down while overall profitability goes up.

Smaller businesses in the middle like restaurants fall apart because they don't have access to the benefits of economy at scale and they can't pay people enough nor can they raise prices (because they're servicing people that have smaller and smaller buying power).

The solution to this problem should've been done decades ago and that's tying minimum wage to inflation. But now we're seeing the end result of what happens when you don't. A lot of restaurants skirted by on extremely low cost labor but in times when said labor market gets fed up, they move on to the larger chains that can afford to pay 15+ an hour and a large correction occurs which kills small town restaurants.

As others said: traffic goes down, restaurants close doors. Food prices may not be the culprit, people getting their meals from delivery and cooking at home may be the cause as well.

Having that said, I do work in market research and gather purchase data and create inflation models for a living and to be honest things look really scary from the US to UK+EU and Latin America (which is used to high inflation though). Who knew all that free money from the last decade would do that!

> Who knew all that free money from the last decade would do that!

As if a war where one of the largest fossil fuel exporters, also exporting enormous amounts of foodstuffs, invaded the biggest exporter in some foodstuffs (grain, sunflower oil, etc.) and a pandemic with all the death, lowered economic activity and lockdowns have nothing to do with the current economic situation. Oil and gas prices are up, and they're a factor in pretty much every other product's price. Add in foodstuff shortages helping drive their prices even more. Some of the increases are profiteering, some are anticipation, some are cold hard math. "Free money" is only a part of it.

In general I agree with you, just want to point out that, as others mentioned, inflation was already in a historic record since 1982 by January/22, before the war. Also:

> Russia No one did really stop buying Russian exports, as we can see through RUB/USD YTD. Their exports actually grew.

> COVID, lockdowns It disrupted businesses and supply chains and still has a direct impact on inflation.

Having said that, I think it's about the contribution of each, and I believe all the quantitative easing and the fiscal spending plans may play a larger role on economic issues than many would like to admit.

"Deaths" from the pandemic have zero impact on inflation.

Oil prices are high and have been climbing since a short-term bottom at the the start of the pandemic. Prices since february are not noteworthy.

Fossil fuel production seems to have peaked in 2018 or 2019 last I saw some charts.

Germany and Europe are shutting down coal and nuclear power plants, and this is having big and wide impact. Dependence on russian nat.gas, and thus the war (with gas prices), are just a few of the consequences. European energy price is raising the price of fertilizer, which is raising costs in agriculture, and so on.

But, for all that stimulus money to not cause inflation, world energy production would have had to double or 1.5x or something. But that's impossible.

> Oil and gas prices are up, and they're a factor in pretty much every other product's price.

True. So why did it make sense for USA to restrict oil pipeline build and reduce oil drilling permits in past 18 months? USA was energy independent a few years ago, and now POTUS asks Saudi Arabia and Venezuela for energy. This is a strange turn.

> So why did it make sense for USA to restrict oil pipeline build and reduce oil drilling permits in past 18 months?

Because "Russia is going to do something stupid" wasn't on the radar then.

Oil leases have been canceled by the Federal government since the Ukrainian invasion https://www.cnn.com/2022/05/12/politics/interior-gas-leases-...

>Due to lack of industry interest in leasing in the area, the Department will not move forward with the proposed Cook Inlet [Outer Continental Shelf] oil and gas lease sale 258," Schwartz said.

You're pushing a bad faith argument

And you are taking what politicians say on faith. Here's a view from the other side: Critics, including U.S. Sen. Lisa Murkowski (R-Alaska), were quick to blast the decision.

“Citing a ‘lack of industry interest’ is nothing more than fantasy from an administration that shuns U.S. energy production,” she said in a statement to CBS News. “Cook Inlet is the sole source of the natural gas that more than 400,000 people in Southcentral Alaska — and significant military bases that are critical to our national security — depend on. I can say with full certainty, based on conversations as recently as last night, that Alaska’s industry does have interest in lease sales in Cook Inlet. To claim otherwise is simply false, not to mention stunningly short-sighted.”

https://www.gobankingrates.com/money/business/why-did-biden-...

The drought causing rivers to have such low flow this year doesn't help! River float trips are yearly staples for some Texans, but if the river isn't flowing - it's not worth the trip often.

People have been complaining that the actual inflation is greater than the "officially reported" inflation for the past 30 years - ever since the Great Recession. The cost for energy was factored out, and even the cost of food was factored out to some extent - so long as you can replace item A with item B and the price of A > B then we'll take item B.

This had led to an "officially reported" inflation rate that is lower than the actual inflation people experience. Critics say it's to keep the cost of social security increases low, since they're based on the "officially reported" inflation rate.

Next up, another pet peeve of mine: the calculation of the unemployment rate..

Edit: replaced "Cynics" with "Critics"

> Cynics say it's to keep the cost of social security increases low, since they're based on the "officially reported" inflation rate.

Intentional or not, it certainly has had that effect. Social security payments haven't kept up with the cost of living.

My grandparents managed to live on social security alone. My father has social security and a state pension and still needs a part time job.

Fair point - I spoke incorrectly. I should have said "critics", not "cynics."

The problem of inflation has been solved before. It is a monetary phenomenon, period. It was solved by Paul Volcker turning the screws, mercilessly, until it went away.

I can understand the desire to treat it as brand-new, never been seen before. After all, maybe you weren't even around the last time this was a problem.

Yes, and we knew covid-19 was of the covid class of virus, people still treated it like it was an alien contageon asif it had never been documented and studied pre-2019 extremely well how this class of infection spreads and what the full risk profile looks like.

The biggest problem here is the risk of "those who don't know history are doomed to repeat it" is cropping up in all forms of public, opinion driven politics and it's in all likelyhood not going to end well. I wish and hope that I'm wrong.

The fool learns from experience. The wise person learns from other people's experience.

In 2021 this IKEA gateleg table [0] cost $199 [1].

In early 2022 it was $229 according to my records, but never in stock at any IKEAs near me. Presumably because of all the crazy supply chain/lumber problems, the IKEA shelves were largely empty.

By the time it managed to get back in stock, the price was $259 [2].

Today it's $279 [0], a 40% increase over its 2021 price. I don't even know how low it was before 2020/pre-pandemic, as far back as archive.org goes it's $199.

[0] https://www.ikea.com/us/en/p/norden-gateleg-table-birch-9042...

[1] https://web.archive.org/web/20210227021124/https://www.ikea....

[2] https://web.archive.org/web/20220422144639/https://www.ikea....

"don't worry you're just imagining it, the market will correct itself"

We're now into the early 1920's stage of potentially a huge depression which will probably end (at best) in a cold war with China/Global-East. At worst more and more proxy conflicts as superpowers turn back to expansionism rather than fixing the fact that the bubble around an exponential growth based economy will eventually burst.

Another furniture anecdote:

In late 2020, we purchased our couch for $400. By early 2021 the price had risen to ~$500, and it was completely out of stock. Now the price is $800 and it's regularly out of stock for months at a time.

https://www.structube.com/en_ca/falcon-3seater-sofa-46-19-68

Ha, I got that table, we had to stalk Ikea's store every day to catch it in stock and drive there immediately.

This is a tangential anecdote for inflation though, it's supply and demand here. They have a limited number so they are going to charge as much as they can for the limited stock they have.

> Ha, I got that table, we had to stalk Ikea's store every day to catch it in stock and drive there immediately.

When was that?

> This is a tangential anecdote for inflation though, it's supply and demand here. They have a limited number so they are going to charge as much as they can for the limited stock they have.

It was consistently in-stock at the Covina, CA IKEA around when the price jumped to $259. At least it seemed to be whenever I checked, but once it jumped to $279 I resigned to just pick up a used one eventually instead when I get back to CA.

Are you saying IKEA is still struggling to get stuff in stock today? I was under the impression that's largely behind us now.

My barber just raised his price 25% for the first time in the 11 years I've been going to him. There's some sticktion to prices that's breaking free with the inflation we're seeing.

I like to look at the USDA retail price surveys for meat: https://www.ams.usda.gov/market-news/retail

Chicken prices are all over the map right now - wings are down from last year, as are bagged leg quarters. Boneless chicken breasts have almost doubled in price.

Dude's paying over retail for AA eggs.

Thanks for the link.

My consumption of beef and pork (Washington DC area) has increased since Covid began. Over the last decade, my grocery stores have moved from in-house butchers to regional processors, or better yet, vacuum sealed products. These products are clean and easier to freeze without repacking.

I have purchased at least more than 100 lbs of cooked, vacuum sealed beef brisket for $8-10 lb in the last year alone. The quality is consistently better than my local BBQ joint.

My approach is to compare and shop, not just buy.

The biggest problem we have facing businesses like restaurants is probably the price of labor, and that is out of whack because you can't live on the wages that restaurants can offer. A lot of that is likely due to things like health insurance, residential home prices and escalating college costs (which also lands on the price of eggs because the trucker who drives those to the supermarket needs health insurance as well). The restauranteur can't just raise prices and pay his workers more though because that "VAT" tax from stuff like health care is being taken out from every transaction in the economy. We're seeing the effects of the parasitism and rent seeking behavior where certain segments of the economy increase to squeeze and tax everyone else because their product is something nobody can do without. If it was just inflation that was happening, then everyone could raise prices and we'd eventually be back to normal (if the value if the dollar is sliced in half, but everyone doubles their prices and wages, nothing really changes). The secular problem we're seeing on the longer term (and the article addresses what has happened since he opened his business in 2001 so he's talking way beyond this latest spike) is more than just inflation.

Generally, this really sucks for the restaurant and the town but,

"the price of food, particularly meat, has risen more than the over-all consumer-price index"

Unpopular opinion: But maybe this is fine? In fact after inflation is under control, maybe real meat needs a heavy carbon tax to keep the prices high. We can rebuild the supply chain around fake meats as we slowly switch away. I know this all seems implausible, because the cow/meat lobby will have a field day with any congressman suggesting this, but one can dream.

One day the economic reaper will come for the software developers: will be kinda fun even though I am one because the the roll out of bed and get $200k/y lifestyle and the entitlement to that will vapourize.

The climate reaper is already here and it’s the Texans featured in this article that will feel the heat first.

The 200k/yr developer will comfortably whisk themselves off up the hill.

Maybe this is more complicate than you think it is?

Maybe more complicated than you think it is. High paid ICs in a corporate lead world are the exception not the rule. The rule is low level workers get enough to survive.

fake meats are overly processed, and probably more expensive too. real chicken has far more protein and is better digested than fake meat. from a nutrition standpoint, the real thing is much better.

True, but so is less of it. “Western Diet” is a real malady at scale.

https://en.wikipedia.org/wiki/Western_pattern_diet

Red meat consumption has been declining in the US since the early 2000s and more people than ever are vegetarians. I think it's time to update the trope about the "Western" diet.

Vegetable consumption is still very low. https://ourworldindata.org/grapher/vegetable-consumption-per...

Can’t replace meat consumption with vegetable consumption. Not enough calories. If you are giving up meat, you are replacing it with grains and legumes.

I skimmed the Wiki article but it seems incredibly US, maybe North America focused. Examples and data were American, and none of it is applicable to Western European countries I'm familiar with. Not that nobody drinks sugary drinks or nobody eats red meat or hamburgers, but they're much less of staples and processed foods are much rarer.

So what's with so many people abusing "Western" to mean American and maybe Canadian?

You know that there are more non-meat foods than just meat-substitutes, right?

"from a nutrition standpoint, the real thing is much better."*

* for now.

I know it’s nice to pin it on the cow/meat lobby, but apart from the people who want to sell meat, there are an awful lot of people who want to buy it.

(Off-topic: There is a similar “problem” with guns. It’s nice to claim the NRA as the evil bugbear, but the real issue is the tens of millions of people who want to buy guns.)

We could also add a healthcare system damage surcharge for red meat. But not for cheese... for... reasons...

The article only supports one theory, which is that food costs are going up. However, I don't think the article looks at the other side of balancing the books: it could just be that fewer people are going to restaurants, even before prices go up.

It's a strange article to illustrate inflation. It mentions there is a drought that has made a local river dry, which was a tourist attraction driving a lot of traffic through the town. This meant a lot less customers, a lot less pay available. It Didn't seem to try to disentangle the inflation from this other pretty big effect... which seems hard to do... But then why pick this town or this headline.

>The New Yorker, talking about Texas restaurants that only cosmopolitan (proxy for "New Yorker") people visit.

Sure, sure. Keep the context in mind.

That article did not mention cosmopolitan people at all.

Well, there are cosmopolitan Rodriguezes

This is what happens when leftist politicians run your state

leftist politicians

Texas

Bwaaaaaaa, hahahahahahahahaha. Oh Murgatroyd.

Sounds like inflation _and_ climate change. But they only talk about inflation.

Are you under the impression that droughts didn't happen in Texas until the 21st century? Can we stop calling all extreme weather climate change? It just gives talking points to the critics.

While a particular dry season isn't indicative of climate change, Texas is very much experiencing a decades-long drying that is definitely attributable to climate change. That water park may not be viable much longer.

https://www.cbsnews.com/dfw/news/megadrought-texas-american-...

Lived here for over 1.5 decades and do not see a "decades-long drying". Texas isn't perfect but water management is something it does right.

https://www.texasmonthly.com/articles/the-last-drop/

"Among the fifty states, Texas may rank near the bottom in many categories—including environmental protection (forty-fifth), quality of parks and recreation (forty-ninth), and availability of mental health care (forty-sixth)—but there is one area of public policy where it ranks indisputably first: water planning. No other state knows with such precision how much water it has and how much it will have in the future."

"The drought of the 1890’s killed off much of its nascent cattle industry. In the fifties a seven-year drought (Texas’s worst statewide drought ever) destroyed much of the state’s agriculture and caused 244 of the state’s 254 counties to be declared federal disaster areas. This led the state legislature to create the Texas Water Development Board, which published its first water plan in 1961."

For every time a climate change hand waver starts up, the answer is, yes climate change is real...it's how the Earth works.

What we need is for people moving to the state do do what we did and get rid of the back yard, make a nice rock garden, stop watering those massive lawns.

That water plan had some costs too. "Goodbye to a river" talks anout some of them. I mostly agree with you though. Amarillo being the exception, they water their perfect lawns like the aquifer was bottomless, and it certainly isn't. The sudden transition to a natural landscape at the edge is quite jarring. Most cities in TX do much better, probably all.

Lived in San Antonio for 2 years in the middle of yet another drouth (welcome to the Southland). Mine was the only lawn in the neighborhood that was brown. Neighbors were pissed. Texas may know exactly how much water they have, but the residents don't seem to understand how important that water is. Part of the reason I moved elsewhere.

"it's how the Earth works."

You missed the part where it's definitely cause by human activity. Especially Texas since it's an oil state and it's government is anti-climate.

"While a particular dry season isn't indicative of climate"

You could have stopped there.

The highlight of the article is that droughts happened around the state even thousands of years ago.

That’s rough, but when a business is no longer economically viable it’s probably time to close up shop.

I know it's unfair of me, but I'm imagining a default-dead early startup guy saying this while drinking the weird mushroom water, so thank you for that

I probably give off that vibe. But nah, I’m just a jaded, cynical survivor of the Rust Belt imploding twenty years ago, causing similar destruction to our mom n’ pops. From which we also never really recovered.

Anyway, more importantly, what weird mushroom water? Is it any good?

kombucha and it is very much an acquired taste IMO

How is fermented tea “mushroom water”?

Old coworkers used to call the growth mushroom as slang for some reason, at least that was the first thing that came to mind.

The other one is a ludicrously overpriced relatively recent beverage called mud water (caffeinated mushroom water?)

In Russian, it is called grib, aka mushroom

Some call the mother colony a 'mushroom'.

I've never heard Kombucha referred to as mushroom water. I assumed they meant Chaga.

Mildew. It tastes like mildew.

Obviously. The article is about the effect of that happening on the community.

What if the economic change is transient? There are only two regular restaurants in town. The impact is larger than just the owner.

I actually found it a really sad article to read. I feel like living in a major city, earning software development $$$'s, it can be real easy to disconnect from the producer side of the economy. Increasingly large companies are creating an environment that's conducive to their profits and survival at the expense of smaller producers who care more about the process and quality of what they produce.

These increased food and fuel costs are largely not transient.

The town itself might very well not be viable anymore. I’ve seen this happen in my own neck of the woods. It’s sad, but the death of small towns like this is just a reality of the economic policy we’ve chosen to pursue here.

I'd be fairly surprised if we don't see gas under $3/gal sometime in the next decade. There's a reason several key economic indicators exclude food and energy (due to the much higher volatility of these categories).

Let’s see, they opened in 2001.

So their original business model assumed gas would be around 1.40/gal (1.90 inflation adjusted).

When do you think gas will fall that low again?

You can’t reasonably predict a specific future price-at-time of a volatile commodity (that’s the whole point of excluding its transient excursions).

Dev 2008, Feb 2016, spring 2020 were all times with retracements back near the 2001 levels (adjusted for currency devaluation/inflation).

I expect we’ll see them again in my lifetime, but you can’t reliably predict exactly when. (If you could, you could retire quite quickly via commodity speculation.)

this is just a reality of the economic policy we’ve chosen to pursue here.

Now who is "we" in this scenario?

American citizens collectively.

But also the general development of the world

So you're just locked into a slowly decaying town by social norms and guilt? Sounds like the well intentioned by arguably antagonistic group of adults in a coming of age young adult movie. The decline of rural towns has been a long term thing.

Just the same thing as people say on HN for other things. Your business model is not my problem.

No you pivot! You have the shop, the loyalty, the community. What I imagine small towns need is convenience. If I can buy some groceries while at the BBQ house that is handy. Maybe sell phone chargers too and watnot. Change the menu so the items are affordable, large but the item cost is lower.

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