Econ PTSD: The pain of prices today and the fear of what America has recently known

We've been burned

I was recently talking to a friend of mine of retirement age, who is not particularly well off, who was lamenting the price of groceries. She is doing fine, but the cost of everything is presenting a challenge. The type of bread she eats is now over $7 a loaf.

Across the country this sentiment abounds. For any family where money is an object, and that is probably at least 95% of families (that’s our guess), there has been a pinch in recent years. For some the pinch has become acute. There are those who no longer eat what they once did. Hamburger meat in the grocery cart is now Spam. Others, younger and perhaps a bit better off, have been likely permanently priced out of the housing market as they’ve watched their rents go up significantly year over year. There is broad economic pressure but we continue to march on without going off a cliff. One can say on the surface, that things are relatively “good” economically. And there is headline after headline telling us that things are good, but with the same caveat.

The economy is great. Why are Americans in such a rotten mood?

The economy is good, but that’s not what polls show.

US economy going strong under Biden – Americans don’t believe it

The “experts” say things are going great, what is up with these stupid consumers?

Though there are jobs people feel economic pain driven by inflation. Additionally, everything is financed now. This Christmas buy-now-pay-later schemes are widespread. People finance their houses, their cars, their CELL PHONES, and, sadly through credit cards, even their food. There are bills on top of bills on top of bills (which never end), and for many families this is stressful even if the local gas station is now paying cousin Bill $16/hour. Whoopee!

I buy the groceries in my house and I make a point to pay close attention to food prices. I also always converse with people in the store about what they think. Great economics can be done at the local Harris Teeter or Food Lion.

Everyone seems to be feeling price pressure in my anecdotal surveys.

The cost of nearly everything is up solidly over the last three years or so. Beer, something near and dear to your editor’s heart, is up at least 30% over the last 3 years. Beef is similar. And on and on.

Also consider that the average price of a new car is $48,334. This is the AVERAGE price. This isn’t a Mercedes or even a Volvo. We are talking Honda or Chevy. The average new car payment is now $729/month.

The average price of a house in Virginia where I live (which is about middle of the pack) is now $445,000. In the town where I live that is a pretty standard townhouse.