How is the 'Cost of Living Crisis' affecting you?

by nicolaou 31 Replies latest social current

  • hoser

    Price controls don’t work. Businesses won’t produce at a loss. The cure for high prices are high prices. Investors won’t build apartment buildings if they can never raise the rent to cover their increased costs over time. Energy companies won’t expand supply if the government caps the rates they can charge the consumer.

    We’re doing ok. We’re locked in for 5 years on our mortgage and energy. The company I work for pays my gas and Mrs hoser takes public transit to work.

  • MeanMrMustard
    Why would you say price control is the worst response?

    Because it will lead to shortages.

    Prices contain valuable information about supply and demand. If something is already in short supply, a higher price is a signal that will 1) cause consumers to cut back and naturally ration their usage of the resource, and 2) cause producers to ramp up production to meet the demand (because the margins are high and the reward is greater)

    If the price is held low, usage never cuts back and production never ramps up. The result is a shortage. If the price is held low enough, it might force producers to operate at a loss, which basically means they will stop producing.

    Shortages are much worse than higher prices.
  • TonusOH
    The result is a shortage. If the price is held low enough, it might force producers to operate at a loss, which basically means they will stop producing.

    Exactly. Many (most?) shortages are caused by a shortage of materials. In other words, you just can't point at manufacturers and demand that they produce more. And if you force them to keep prices artificially low, they may not be able to afford the materials they need when those become available. That is how a situation of scarcity can last longer than it should-- when people with political intentions step in and try to solve problems that they do not understand, they usually make things worse.

    The US has the capability to produce more oil than we need; possibly more than any other nation on the planet. We are deliberately limiting ourselves because some politicians and activists think that, if you put a nation under enough adverse pressure, it will invent a magical form of energy that solves all of our energy and climate issues. If you cannot distinguish between real life and a comic book, you probably should not be running a nation.

  • jojorabbit

    I believe there are going to be food shortages soon. Personally I have been putting away long term storage food that is freeze dried and good or best by 2052. Its only for emergency and I hope it will just rot away and I will never need it. But I believe in Gold, Silver as a hedge against inflation and food and other things that will not go bad. The fed has been way way to lax trying to keep interest low and now they are too little too late They need to be raising rates at 1 point not .25. Housing is in another bubble and people who are sub prime are starting to default on car and home loans. We have to go through a recession and it must be significant or we are just kicking the can down the road. Just think how bad it would be if build back better had dumped trillions of printed fresh money in the system. It would be great depression. Anyone who can think at all could see this coming. But the Fed kept pouring gas on the fire. Janet Yellen said some of the dumbest things in the last few weeks. She really is an idiot.

  • Judgerussellford

    Biggest problem over here in the states to me, is they are spending 40 billion to help Ukraine and threatening to start crap with China over Taiwan with will cost even more, but some how, SOMEHOW, they can find money for us to afford gas and can't figure out how not to take care of problems that don't pertain to us. I'm sorry about Ukraine and all but America is not the worlds police, and you can't just spend that kind of money on other people and leave your own to rot. Thats like if I spent 1000 dollars a month on a friend I haven't seen in 10 years, and don't take care of my family. Ridiculous. You can't fix others problems if your own are left crumbling around you. Midwest isn't bad right now. 4 to 5 dollars a gallon right now, but I know its reaching higher around us so I'm not complaining. Groceries are getn stupid high too. 10 items was 60 dollars.

    "... but do not harm the olive oil or the wine"

    I don't know about you, but I'm neither of those things

  • MeanMrMustard

    As an example - let's say a natural disaster occurs. Horrible. Property damaged everywhere. Gas suddenly has a price spike. In some areas, the price is $50/ gal.

    Is this good or bad?

    Politicians will get on their high horse and crack down on 'gouging'. It's just unacceptable that anyone should pay above the normal price.

    But soon nobody in the hardest hit areas have any gas. There is nothing to buy, nothing to run generators. People have money, and a desire to buy gasoline. But there is none. So they go cold and suffer more.

    But if they just let the price rise, everyone and their uncle would load up their car and move gasoline into the affected area. Gas tankers, spurred on by incentive, would pull extra deliveries. Everyone would have more than enough gas. But as the supply rises, and demand is satisfied, competition will bring the price down again.

  • Simon

    There's also the preparation.

    if you want people to have stocks of water for when there is a hurricane, they need to be recompensed for the storage and upfront outlay.

    While it may sound noble to say "no price gouging" all it really guarantees is that there will be no water available.

    Oh, and some huge government agency out of business.

  • FedUpJW

    There's a good chance that some people will actually starve to death at some point. Many others will be crippled financially and long-term will have reduced lifespans as a result.

    That is, IMO, the agenda of the left. Create a crises, then claim to have the answer, and you can bet your --- it will mean more government control over you life!

  • MeanMrMustard

    To answer the OP more directly:

    I have 4 kids. I've noticed my grocery bill double this year. Also, I've noticed less product within the package.

    Buying bulk helps.

  • Fisherman

    Paid 1000$ for a roll of tissue paper. I don’t think it was worth it.

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