Basic issue isn't excess of money. Basic issue is shortage in supply. Demand hasn't skyrocketed magically.
The world over production levels were lowered to almost zero for couple of years.
Interest rate hikes have wreaked a havoc of their own.
The world over production levels were lowered to almost zero for couple of years.
Interest rate hikes have wreaked a havoc of their own.
What's the supply issue that's impacting normal grocery store items? Is there a ship full of peanut butter ground beef and breakfast cereal stuck in a canal somewhere? Why would we have a shortage of things like cheese and pasta?
For a short time there were real issues with things like toilet paper, but even that has been resolved (unless you're in the EU maybe). What's driving shortages now?
> What's the supply issue that's impacting normal grocery store items?
* https://www.nerdwallet.com/article/finance/why-are-eggs-so-e...
I'm not saying bird flu played zero role in the price increases seen in stores, many producers were legitimately impacted, but that doesn't mean that people, already suffering from high prices, weren't being taken advantage of at every opportunity because of simple avarice.
"Cal-Maine Foods, the nation’s largest producer of eggs, reported this week that its revenues doubled and its profit surged by 718% in the last quarter as a nationwide egg shortage has sent prices soaring...Cal-Maine, which controls about 20% of the national egg market, reported a net income of $323.2 million, a seven-fold rise from the same quarter last year...The company has said that its egg production facilities have been spared the wrath of avian flu, the contagion that has forced farms to cull more than 58 million chickens and turkeys since the outbreak spread in early of last year." (https://nypost.com/2023/03/30/cal-maine-foods-profits-surge-...)
Then corporations figured out that they could make huge bank and kept rising prices -> inflation.
That makes no sense.
There were no supply issues during covid with many, many products. Yet those prices went up too, even in a country with a high level of competition.
Why?
We as in "society"), have assumed this would be solved by some healthy competition. It's just that we optimized society for maximum short-term gain rather than a market where newcomers are welcome. As a result, the players that are already in the game are free to ignore the forces society assumed would keep things running smoothly.
So why was inflation only a problem last year? Did shareholders not try and extract maximum value before that?
It turned out profits were more important, and now people are angry about the new 230g mayonaise tube costing the same as the 275g one did last year. But at least the new tube required 17% less plastic.
Something's got to give if we expect inflation to drop. _Many_ people expect businesses to take the hit. After all, many raised prices due to things like energy costs last winter, but very few lower them again now that production costs go down again.