Comment by gruez | Hacker News Reader

Comment by gruez | Hacker News Reader

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>but then again prices for these have doubled or more over the last two years.

Where are you buying your food? At least according to BLS data raw ingredient inflation is nowhere near that high. If you compare the price indices between today and late 2019, the max price you see is 59% (for the entire period, not annualized). Most are in the 20-30% range. I know this is BLS data for the whole country and localized inflation might be higher in specific places and/or outside the US, but 4x higher seems like hyperbole.

Here's a comparison based on an arbitrary selection of "basic ingredients":

    category Nov. 2023 Dec. 2019 % rise
    Flour and prepared flour mixes 325.853 225.638 44.4%
    Rice, pasta, cornmeal 291.728 234.282 24.5%
    Beef and veal 415.788 313.818 32.5%
    Pork chops(4) 242.457 191.834 26.4%
    Other pork including roasts, steaks, and ribs(5) 160.961 129.193 24.6%
    Chicken(4)(5) 194.86 152.095 28.1%
    Other uncooked poultry including turkey(5) 209.362 147.475 42.0%
    Fresh fish and seafood(4)(5) 220.513 186.119 18.5%
    Eggs(4) 261.105 213.421 22.3%
    Milk(5) 176.76 144.845 22.0%
    Cheese and related products(4) 264.392 234.486 12.8%
    Fresh fruits 417.433 353.047 18.2%
    Fresh vegetables 376.284 334.875 12.4%
    Frozen fruits and vegetables(5) 186.642 142.654 30.8%
    Roasted coffee(6) 250.296 196.173 27.6%
    Sugar and sugar substitutes 261.475 186.257 40.4%
    Butter and margarine(5) 284.894 199.761 42.6%

[1] https://www.bls.gov/web/cpi/cpi-u.xlsx

[2] https://web.archive.org/web/20201022124428if_/https://www.bl...

There has been significant increase in ingredient prices at grocery stores due to the consolidation of basically every chain under Kroger and Cerberus Capital Management. They've been shutting down stores, eliminating competition and dramatically raising prices. And they're trying to themselves merge.

While those core goods prices are I believe accurate, the prices at point of sale have gone up significantly more - especially in places that went from having a competitive grocery market to, well not.

Note that restaurants have done a significantly better job of controlling ingredient costs specifically because they don't shop at grocery chains.

>While those core goods prices are I believe accurate, the prices at point of sale have gone up significantly more - especially in places that went from having a competitive grocery market to, well not.

CPI, as the name suggests, is based on consumer prices. They're not taking the price of wheat features and calling it a day.

https://www.bls.gov/cpi/questions-and-answers.htm

I was typing too fast, lol, I meant to say "the prices at point of sale have gone up significantly more for some people." Especially in places that used to have a competitive grocery environment. I think people tend to mistake their personal experiences for broader trends.

Of course I agree with you about how CPI samples are taken and that they are representative of the market as a whole.

tl;dr: I agree with you, I'm just floating a theory as to why some people may have significantly different experiences on a micro level.

> places that used to have a competitive grocery environment

This is what I’m seeing, anecdotally. In towns with more than one non-affiliated grocer, prices are cheap. In towns with consolidated groceries, prices are higher. Enough that the “savvy” shoppers, i.e. those with a car and time and liquidity to enable bulk buying, drive to the next town over.

It’s pretty crazy to me that Kroger is looking to buy/merge with Albertsons (Safeway) with basically no opposition. I generally prefer Kroger brand stores, but I can’t imagine this will be good for consumers in any sense.

Yep exactly it's not even Kroger and Safeway. It's...

(a) Kroger - Kroger, Ralphs, Dillons, Smith’s, King Soopers, Fry’s, QFC, City Market, Owen’s, Jay C, Pay Less, Baker’s, Gerbes, Harris Teeter, Pick ‘n Save, Metro Market, Mariano’s, Fred Meyer, Dillons Marketplace, Fry’s Marketplace, King Soopers Marketplace, Kroger Marketplace, Smith’s Marketplace, Food 4 Less, Foods Co.

(b) Cerberus Capital Management - Albertons, Acme Markets, Carrs-Safeway, Haggen, Jewel-Osco, Kings, Pavilions, Plated, Randalls, Safeway, Shaw's and Star Market, Tom Thumb, United Supermarkets, Vons.

20-30% is around what I see. I still think that's high for a period of 2 years (imagine that compounding over 10-20 years...).

There was a situation a while ago where egg prices really did "double or more" (about $1/egg in the worst places). But that's also the one place I've seen where prices went back down, and big brands got charged with collusion, and there was an avian flu epidemic on top of that.

Government lies, aka statistics, conveniently ignore the cost of high quality items when doing averages. If you are buying eggs as a health conscious person, you know not to buy $1/dozen eggs any more because industry producers have made them low cost by reducing quality, feeding chickens soy and the cheapest excuse for food. The pastured ones are 5-10x the cost and the quality is night and day. US government conveniently views these things as staples, but they are not.

https://wolfstreet.com/2019/12/05/what-worries-me-about-hedo...

I think this sums it up well. People mostly don't know or care about how hedonic regression is used in CPI (myself included, on knowing). I don't think the process is easy to understand nor transparent (although I may be wrong here).

But BLS denies this assessment (and it's not 100% related to the article posted, but closely related to your comment I think):

https://www.bls.gov/cpi/factsheets/common-misconceptions-abo...

> When the cost of food rises, does the CPI assume that consumers switch to less desired foods, such as substituting hamburger for steak?

> No. ...

> Is the use of "hedonic quality adjustment" in the CPI simply a way of lowering the inflation rate?

> No. ...

Obviously, they provide their own explanations, but I'm not going to paste the whole thing. This is definitely something I'd like to understand better though. Especially every time I complain about how Chewy Chips Ahoy or some other product I enjoyed in my childhood is absolute garbage now, and I don't buy the explanation that I simply had bad taste as a kid.

They also host this Quality Adjustment page to say which types of products do or don't have such adjustments: https://www.bls.gov/cpi/quality-adjustment/home.htm. So maybe this is transparency. I think it would take me 2+ hours on a weekend to really research this to understand it myself.

The BLS also produces an inflation research series called R-CPI-U-RS that does not make substitutions, and it's really not very different from the formal CPI series. [1]

Note that all of the data and methodology that goes into this is public and if there were any real, actually problematic substitutions, you'd know about it. The substitutions are good, actually, as they reflect changes in tastes. For instance, lobster and caviar used to be food for poor people. Should they be part of the CPI despite the fact they're rich people food now? Definitely not, that would massively overstate inflation.

> Especially every time I complain about how Chewy Chips Ahoy or some other product I enjoyed in my childhood is absolute garbage now, and I don't buy the explanation that I simply had bad taste as a kid.

Honestly, I buy that completely. We've known our tastes change as we get older. I used to hate tomatoes, now I love them. [2]

[1] https://www.bls.gov/cpi/research-series/r-cpi-u-rs-home.htm

[2] https://www.bonappetit.com/entertaining-style/trends-news/ar...

> Honestly, I buy that completely. We've known our tastes change as we get older. I used to hate tomatoes, now I love them.

I used to hate eggs, and now I love them, and I am aware of that change in my taste. The concept that tastes change is not new to me. I also used to love Oreos, and I still do. They do not taste significantly different. Chocolate chip cookies, in general, still taste good to me, especially slightly under-baked ones (which the "Chewy" Chips Ahoy resembled in texture when I enjoyed them as a kid).

The fact that, in current day, I would despise this one type of chocolate chip cookie that I used to like--and also while still enjoying other cookies and chocolate chip cookies, and fully understanding that tastes change--seems to be an absurd scenario compared to the distinct possibility that something changed in the way they make the cookies. Also, considering Kraft (which owned Nabisco which owned Chips Ahoy) split up in 2012, I'd be more surprised if they didn't decide to make changes to some of their recipes.

However, I do remember at one point trying baijiu (白酒), and it ruined the taste of sodas and diet sodas to me for several months. It was an abrupt but temporary change. No idea how that works, but the taste (really the smell) became unbearably similar to baijiu. Kind of want to try baijiu again now that I think about it.

US prices seem to be very different from where I live.

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