Isnt inflation usually considered the most regressive of all taxes as it hits the poor the hardest?
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Speaking of prescription drugs, the majority of them are synthetic small molecules. Prices of solvents, catalysts, gases, etc. used in the processes to make these drugs skyrocketed for various reasons. For example, the price of a common palladium catalyst doubled since 2019. Sure, it is only used in catalytic amounts, but it all adds up.
Using Mint, I can estimate how my expenses changed from previous years. I am comparing the range Oct 1st to Nov 1st. 2022 = Oct 1 2021 to Nov 1 2022. While prices have increased in many areas, my expenses have generally decreased. Some of this decrease in expenses depends on external events, such as fewer long drives for long out of area hikes due to longer hikes being too much for 15-16 year old dog, so less gas. And some of this relates to changing habits, partially in response to inflation. For example, after a long period without Costco membership, I chose to renew membership and get a portion of groceries at Costco.
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Food: $4090 in 2021 → $3716 in 2022 (down 9% in 2022)
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Gas: $1390 in 2021 → $836 in 2022 (down 40% in 2022)
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Auto Total: $4174 in 2021 → $3039 in 2022 (down 27% in 2022)
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Water: $1849 in 2021 → $1654 in 2022 (down 11% in 2022)
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Gas/Electric: $106 in 2021 → $121 in 2022 (up 14%, but negligible portion of total expenses)
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Internet/Phone/Streaming/Cable: $1393 in 2021 → $1566 in 2022 (up 11%, but current monthly total is $64/month = $768/year, so should be dropping quickly)
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Total of All Expenses – down 12% in 2022. By far the largest decrease was in the home improvement category. I wrote a check for over $3000 for something in the 2021 period (may have been adding gutters). I also added porcelain tiles to a bathroom.
You’re not wrong! But, for every one if those individuals starting out with a nice hearty salary is a educated or uneducated person still starting out a a wage that is very very hard to live on. And on top of that seasoned workers - who go without increases in salary or meager Increases that can’t make the difference of inflation of basic items
My whole point (really all through this thread) even when we are talking about “upper middle class” is to think outside that UMC mindset to not assume that the balance is evening out one way or another for people - of any class except for a small % of those who really have no $ worries.
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I will share again. In the last couple of weeks both my mom (assisted living) and my MIL (independent living), who are in different senior communities in the Chicago area, received the new billing information for the coming year. Rates are going up 10%.
MIL is in a “buy in” place and can’t be kicked out due to lack of funds in the future. My mom is in a rental type community and while her monthly rate is nearly twice what it was for both my parents, when my parents originally moved in as “independent living” ten yrs ago, she can afford it. The monthly rate is actually much lower than what it would be if she were moving in somewhere else as a new resident. [note: many communities charge a higher rate if you enter as an AL resident; often there is a discounted rate if you have to transition from IL to AL within the community.]
I truly empathize with families who will struggle with the price increases. I expect senior care will continue to increase because caring for the elderly is extremely challenging. I also believe the coming years with aging baby boomers will stress an already stressed out business model.
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I agree, and I think the high cost of wages to attract employees is one of the primary causes of our country’s inflation. My personal “Grand Pumba” way to fix it would be to let travelers and immigrants work. Jobs are filled, wages come down, taxes go into the gov’t, and lives are changed for the better.
It’s a dream though.
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We agree totally. The affect on the individual depends upon the individual’s circumstances. Statistics never apply to the individual.
I’m just saying it’s always been that way. There have always been winners and losers pending what the economy is doing.
I think you have it backwards. Inflation creates a demand for higher wages. And once higher wages get baked in, it’s even harder to get inflation under control.
If I was to guess, the primary cause of our inflation is overspending, and #2 would be the restrictions on fossil fuel production.
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A large portion of surveyed persons saying “inflation is a concern” does not mean that inflation isn’t helping them. For example, a person can be concerned about increasing gas and food prices, even if the net effect of inflation is positive for that person between increased salary and reduced value of mortgage/debt. Of course the net effect is negative for many persons as well. As has been noted, negative effects may be felt disproportionately by persons with lower incomes, persons on fixed incomes, persons who depend on savings rather than income sources that increase with inflation, etc.
The fed’s decision to increase rates depends on more than the net immediate effects of individual families. They are considering things like long term future economic growth, effects on future government expenditures and trade, reducing chance of hyperinflation spiral, sending a signal to influence expectations, etc.
Wow @Creekland.Given that most Americans are living from paycheck to paycheck and a substantial number can’t cover an unexpected $400 expense, I truly did not think anyone actually hoped wages would decrease.
Data10, it is not that the poor may be adversely affected-we know for a fact that they are heavily adversely affected and disproportionately so compared to wealthier citizens. Inflation goes up and hunger skyrockets for those not on CC.
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By “negative effects may be felt disproportionately by persons with lower incomes, persons on fixed incomes, persons who depend on savings rather than income sources that increase with inflation, etc”, I meant these groups are more likely to see negative effects from inflation than average. Although even among these groups, it is not 100%. Some among these groups will still see net positive financial effects related to inflation. It sounds like we are saying something similar.
In a typical situation I would agree with you, but this one is not typical at all. A lot of people left the job market during Covid and haven’t returned. Once Covid was “over” (people returning to normal), workers were needed and couldn’t be found - hence wages increased. Once wages increased costs of services and products increased to cover those wages. The problem right now is not enough workers.
If wages were back to where they were, prices wouldn’t have gone up. At this point what we all need is for it to level off, likely at our new normal. It seems to be heading that direction at least.
What I want to see is wage change - less at the top, more at the bottom. That would help the class I want to see helped and not truly hurt the top at all TBH. But my wishes aren’t affected by inflation either. That can happen at the old normal and the new normal. It’s a different topic altogether.
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Baggu bags folded and in pouch are 4.5x4.5 and 1 inch thick. They are more compact than that sounds because they are pliable and compress well. They are great bags.
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I got six of these from Amazon a long time ago. Cheap, cute, and fold down to nothing.
https://www.amazon.com/stores/page/97599886-CE6B-42B3-A798-B383CCD73CA9?ingress=0&visitId=c5800591-165e-495b-946f-9916bf0bf1ac
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I got a family pack for $1.99 a pound last week!
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Some changes in prices from 1 year ago as listed in today’s inflation report are below:
Margarine – 47% increase
Eggs – 43% increase
Airline Fares – 43% increase
Butter – 27% increase
Flour – 25% increase
Health Insurance – 21% increase
Utility Gas – 20% increase
Lunchmeats – 19% increase
Canned Fruits & Vegetables – 19% increase
Motor Gasoline – 18% increase
…
All Energy items – 18% increase
All Food Items – 11% increase
All Items – 7.7% increase
All Items Except Food + Energy-- 6% increase
College Tuition – 2% increase
…
Sporting Event Tickets – 18% decrease
Televisions – 18% decrease
Smartphones – 23% decrease
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Here is the link to the inflation report, it’s time to buy smart phones.
Here’s the inflation breakdown for October 2022 — in one chart
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All fine and good- but someone who is self employed and turning 65 (and continuing to work) is going to find their health insurance costs plummeting by 80% or so (like my spouse- and it might be a bigger decrease depending on the Part D plan he picks).
Haven’t eaten lunchmeat since college.
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data10 -i’m stumped at your gas/electric yearly amount. ? how do you heat/cool your abode? have ongoing electricity for your internet or phone charging? solar? apartment where this is all covered? or perhaps that’s a monthly charge? can’t figure it out!