Economics,Hyperinflation and more

[NevadaBlue]

Amen Ben,

During the first 6 months of the lock downs we ate anything older than 2019 (I Date Everything when it comes in the house) and restocked when things were available. Right now I am over 100% but I am pushing supplies up a little bit more so I can go without buying for a few months (without depleting my reserves). I am also increasing my home production capabilities to allow me to cut out the middle-men. We have also been working hard to separate our wants from our needs, a penney saved is a penney earned.

A side warning, property crimes increase during high inflationary periods, when people can't afford what they need they often start taking what they want.

This is true. And since I am generous, I will freely give them some of my precious metal. They don’t even have to ask!

 

[Meerkat]

Sage advice. This is especially important to people building their 401Ks with absolutely NO HELP!
Making a mistake isn't that bad, unless you don't find about it until 20 years later.
I'm slightly on topic because the thread title does have the word economics in it.
I am still working on a simplified article explaining compounding and why everybody missed it in economics class.
Teaser: Guess what the difference is between an old fart, and a wealthy old fart? Compounding.
If this thread gets too slow, you better look out!

You ring?

 

[Meerkat]

https://www.businessinsider.com/pho...aign=Feed:+businessinsider/thewire+(The+Wire)

 

[zoomzoom]

Not sure I believe that one Meerkat. The sign says "Clearance" all the way down the isle. This is where they put their misc crap they just want cleared out.

 

[ssonb]

Z Z that picture proves to some extent of what is going on.... It is strange times when even WM has nuthin on the clearance isles!

 

[Meerkat]

Not sure I believe that one Meerkat. The sign says "Clearance" all the way down the isle. This is where they put their misc crap they just want cleared out.

Zoom I don't know either. Could be or not be something to it.

 

[UrbanHunter]

I know that shopping is now a hit or miss proposition here. The wife is experiencing the same thing online, she is looking for fabric and stuff as she remodels the master bedroom and is constantly hitting the out-of-stock / back-ordered wall. Because she does not drive and has not done grocery shopping for a while, it is hard for her to comprehend how things have changed, from time to time she will look at a receipt and is totally floored by what she sees.

I have noticed my 12 pack soda has gone from 4/$10 to 3/$11 to 2/$9, almost makes me consider giving it up.... almost

 

[angie_nrs]

This is how I am bracing for inflation:

1. I keep investing in my IRA (especially my Roth since it is more liquid)
2. I'm spending my cash on things I will need in the future, just as I have been doing these last few years. I can't buy ammo anymore (b/c it's not on the shelf), but I can buy TP, socks, LTS foods, gardening equipment, etc. Just as I did with ammo, I grab extra supplies every time I go to the store b/c I have the room to store it and it keeps people from gawking at my shopping cart.
3. I have put cash into PM's

It's just a weird place for me to be right now in trying to figure out things to spend cash on. We've spent so many years saving cash that it's tough for us to get our brains into 'spend' mode. We have even been spending some on fun splurges. There have been some things on our wish list for a while and we are finally pulling the trigger on some of those purchases. Lifes short, so we might as well enjoy some of these 'things' while we still can. And, many of these things are still considered assets that can be resold if necessary. This is a spooky time for me, but we are managing to have some fun and make improvements, despite the craziness that is going on in the world.

 

[UrbanHunter]

I would like to spend on things like long term storage and getting completely out of debt, the wife would like to make the house look nicer.... We agree to disagree. I think that she is stuck in the house and is tired of it looking the same. I might feel the same way if the roles were reversed.

I would prefer to just get to a point where I could retire, I would love to move someplace so far out in the boonies that when you ask someone for directions to get there they look at you funny and say you can't get there from here.

 

[hiwall]

It's just a weird place for me to be right now in trying to figure out things to spend cash on. We've spent so many years saving cash that it's tough for us to get our brains into 'spend' mode. We have even been spending some on fun splurges. There have been some things on our wish list for a while and we are finally pulling the trigger on some of those purchases. Lifes short, so we might as well enjoy some of these 'things' while we still can. And, many of these things are still considered assets that can be resold if necessary. This is a spooky time for me, but we are managing to have some fun and make improvements, despite the craziness that is going on in the world.

We are doing the same but after being frugal for all our lives, it is hard to make the change.
I did buy an electric bike this year just for fun.

 

[angie_nrs]

As if folks needed another reason to stock up and grow a garden. It might be a little late now to buy fruit trees, but better late than never.........

THE GROCERY PRICE SHOCK THAT IS COMING TO A STORE NEAR YOU
https://www.blacklistednews.com/art...ice-shock-that-is-coming-to-a-store-near.html
If you thought the price increases you have seen in the grocery store have been strong, buckle your seat belt, you haven't seen anything yet.

This week, the Bloomberg Agriculture Spot Index — which tracks key farm products — surged the most in almost nine years, driven by a rally in crop futures. With global food prices already at the highest since mid-2014, this latest jump is being closely watched because staple crops are a ubiquitous influence on grocery shelves — from bread and pizza dough to meat and even soda, reports Bloomberg.

Bloomberg continues:

Soaring raw material prices have broad repercussions for households and businesses, and threaten a world economy trying to recover from the damage of the coronavirus pandemic. They help fuel food inflation, bringing more pain for families that are already grappling with financial pressure from the loss of jobs or incomes. For central banks, a spike in prices at a time of weak growth creates an unwelcome policy choice and could limit their ability to loosen policy.

It is going to get real very soon.

 

[LadyLocust]

As if folks needed another reason to stock up and grow a garden. It might be a little late now to buy fruit trees, but better late than never.........

THE GROCERY PRICE SHOCK THAT IS COMING TO A STORE NEAR YOU
https://www.blacklistednews.com/art...ice-shock-that-is-coming-to-a-store-near.html
If you thought the price increases you have seen in the grocery store have been strong, buckle your seat belt, you haven't seen anything yet.

This week, the Bloomberg Agriculture Spot Index — which tracks key farm products — surged the most in almost nine years, driven by a rally in crop futures. With global food prices already at the highest since mid-2014, this latest jump is being closely watched because staple crops are a ubiquitous influence on grocery shelves — from bread and pizza dough to meat and even soda, reports Bloomberg.

Bloomberg continues:


It is going to get real very soon.

I asked someone overseas what's next because they seem to be about 6-8 months ahead of us. She said anything with a computer chip of course. But otherwise what hasn't been available or is in short supply is canned fruit - empty shelves, and grains - still available but higher price every trip to the store.

 

[Pearl]

Rough road ahead!

 

[Meerkat]

As if folks needed another reason to stock up and grow a garden. It might be a little late now to buy fruit trees, but better late than never.........

THE GROCERY PRICE SHOCK THAT IS COMING TO A STORE NEAR YOU
https://www.blacklistednews.com/art...ice-shock-that-is-coming-to-a-store-near.html
If you thought the price increases you have seen in the grocery store have been strong, buckle your seat belt, you haven't seen anything yet.

This week, the Bloomberg Agriculture Spot Index — which tracks key farm products — surged the most in almost nine years, driven by a rally in crop futures. With global food prices already at the highest since mid-2014, this latest jump is being closely watched because staple crops are a ubiquitous influence on grocery shelves — from bread and pizza dough to meat and even soda, reports Bloomberg.

Bloomberg continues:


It is going to get real very soon.

We buy the fruit trees that are producing down here.We gave up on apple trees though,too many late frost,and peaches didn't make a year.I did at least finally get one apple pie from the apple tree before it went from heat exhaustion I guess. Called it One Apple Pie tree.
I just used a lemon I froze last year ,I just stick them in the freezer whole and they come out fine.
Ornges,Lemon,Banana grapefruit do good here and pecans. Pear tree is ok but not great.

We need to buy some more trees though last couple years we have not taken care of thrm at all.

 

[Meerkat]

Rough road ahead!

I think your right,seems it just keeps getting worse.Now we also have millions more people buying too.

 

[Pearl]

We buy the fruit trees that are producing down here.We gave up on apple trees though,too many late frost,and peaches didn't make a year.I did at least finally get one apple pie from the apple tree before it went from heat exhaustion I guess. Called it One Apple Pie tree.
I just used a lemon I froze last year ,I just stick them in the freezer whole and they come out fine.
Ornges,Lemon,Banana grapefruit do good here and pecans. Pear tree is ok but not great.

We need to buy some more trees though last couple years we have not taken care of thrm at all.

Our peach trees do good here in N. Tx, there are a couple of big old pear trees in a neighbor's pasture that are great. Especially since they don't have the mean bull anymore! He loved pears! Apple trees never do well here.

 

[Amish Heart]

We've got a pear and an apple tree here, but they've been sorely neglected since no one really lived here for years and years. Hoping to get some fruit this year.

 

[Supervisor42]

I think your right,seems it just keeps getting worse.Now we also have millions more people buying too.

Bought a dozen jumbo white eggs for $2.99 today, not on sale. Plenty in stock.
I think inflation will affect some things more than others... like last time.
Day before yesterday, the fed-chairman finally admitted that inflation exists and is expected to increase.
We should be making a list.
Lemme see now, ammo, handguns, rental cars, plywood, lumber, gasoline, diesel, ...

 

[Meerkat]

I think we may need some quite weapons too SuperV. Traps,bow arrow,pits,lol.

 

[Amish Heart]

That's alot for eggs, Supervisor. They are cheaper where I live. Most of the farms sell for $2 a dozen. I just give them to neighbors and family

 

[LadyLocust]

That's alot for eggs, Supervisor. They are cheaper where I live. Most of the farms sell for $2 a dozen. I just give them to neighbors and family

I give $3/doz here for real free range eggs. They can be different sizes, colors etc. doesn't matter to me. They are good eggs. Here in town, $5/doz for sorta free range and not great eggs.

 

[Supervisor42]

That's alot for eggs, Supervisor. They are cheaper where I live. Most of the farms sell for $2 a dozen. I just give them to neighbors and family

Not really for where I shop.
Regular ground beef (80%) = $4.09 per pound.

 

[angie_nrs]

We should be making a list.
Lemme see now, ammo, handguns, rental cars, plywood, lumber, gasoline, diesel, ...

I think a list of things that have NOT gone up in price recently would be a whole lot easier to keep up with.
We ordered take out this week from the local tavern based on their menu online. When we picked up our order all the prices were off. They added a dollar to every item and haven't updated their online prices. I wasn't going to argue it with them, but I won't be going there again.

Hubs spoke with the guys at the local hardware store and the manager said he's getting paid cash from people who've never paid in cash before. I think folks in my area have come to the realization that their dollars are on the way to becoming extinct. Typically when inflation takes hold, interest rates shoot up. That hasn't happened yet. So it makes me wonder if, at this point, your money is safer in the bank/credit union or in cash. I have some of each and will keep an eye on interest rates and see what happens there. In the meantime, I'm on a spending spree. We've got some big purchases planned for next week, with cash.

I've seen some articles warning about the increase in coffee prices coming our way. I'm stocked up, but see that there were some good sales last week. Coffee drinkers......stock up now! Thankfully it has a fairly long shelf life.

 

[UrbanHunter]

I checked and eggs are still inexpensive ($1.47 a dozen), ground beef 80/20 is about $4.50 per pound, ground turkey is $6.90 per pound, and milk is $3.20 a gallon. Chicken is still a good deal with prices ranging from $1.25 to $4.00 per pound.

Beef is expensive in my book ranging from $8 to $31 per pound depending on the cut.

I find that some of the specality items the wife orders can be very expensive, but she does not order a lot of them. I think her name brand ice-cream and unsalted mixed nuts are on the expensive side, but it's not worth the argument.

 

[Amish Heart]

Steaks are expensive here, but hamburger is not. I can find it on sale for about $3 something a lb for 80/20. The farm stores sell it for $5 a lb. We get about 3 dz eggs a day, and only use 7 or 8 of them a day.

 

[WVDragonlady]

I've been stocking up on spices. Most herbs I can grow here and dry myself but I can't grow spices.
I've had 2 large orders delivered this past week of 1lb jugs.
Things like cinnamon,cloves ( both whole and ground), paprika, ginger,etc. I have more on my list to order again next week.
Everything grown in tropical regions I'n trying to get stocked up on.
Not only because of the price may go up but also getting them may be harder to come by just because international shipping is getting crazy.

I'm also stocking up on supplies to make my own seasoning mixes and such
Also plain gelatin ( make my own jello)

Meat here is very high. The cheapest is on sale is chicken for 99 cent lb and then you better get to the store early because it'll be gone
I'll buy ground beef if its under $4 lb but not often.
Forget any other cut of beef. Too expensive and we're not that crazy over beef anyway.
I'll only buy most meats if they're on BOGOs which make them half price or if I come across them marked down

I don't know how the elderly on a fixed income make it every month. I really don't
I'm stocking up as much as I can

 

[WVDragonlady]

Weird how this just popped up for me to read
https://www.zerohedge.com/markets/buckle-inflation-here
some highlights:

Similar to what we did, BofA has also picked up key inflation commentaries from earnings calls, which noted that raw materials, transportation, labor, etc. were cited as sources of inflation and many plan to (or have already) raise prices to pass through higher costs.

• FAST (Industrials): “we are experiencing significant material cost inflation, particularly for steel, fuel and transportation costs.”
• GIS (Staples): “Looking ahead, as we experienced higher inflationary environment, our first line of defense will continue to be our strong holistic margin management cost savings program. In addition, we are taking actions now and in the coming months […] to drive net price realization that will benefit our FY2022. “
• CAG (Staples): “we're seeing input cost inflation accelerate in many of our categories and across the industry.”
• LW (Staples): “while the pandemic-related effects on our supply chain were the primary drivers of our cost increases, we also realized higher costs due to input cost inflation in the low single-digits. We expect that rate will begin to tick up in the coming quarters as edible oil and transportation costs continue to increase.”
• STZ (Staples): “similar to previous years, we're expecting substantial inflation headwinds in the low to mid-single-digit increase range, largely related to glass and other packaging materials, raw materials, transportation and labor costs in Mexico. “
• PPG (Materials): “we experienced a significant acceleration of raw material and logistics cost inflation during the quarter. Coming into the year, we were expecting an inflationary environment and had prioritized selling price increases across all of our businesses. This has helped us achieve solid price increases year-to-date. With a higher inflation backdrop, we have already secured further selling price increases and are in the process of executing additional ones during the second quarter. “
• DOV (Industrials): “What we are going to fight against between now and the end of the year […] is inflationary input costs between raw materials, labor, and price/cost. […] the way it's looking we may have to intervene on price again in certain of the businesses over the balance of the year.”
• TEL (Tech): “I would expect our margins to modestly improve as we work our way forward here into the third and fourth quarter based on some of the actions that are underway and our ability to combat some of the inflationary pressures out there. […] Certainly, we're feeling the biggest inflation right now is on the freight side. The freight inflation has been significant. And as we battled through there and there's a variety of reasons for that including higher air freight and so forth in terms of that. And that's not unique to TE. Certainly, I think that's been as well publicized across the overall supply chain. […] labor cost is not a major issue on the inflation side, but labor availability in certain places that are still being more impacted by COVID continues to drive some inefficiencies.”
• CMG (Consumer Discretionary): “So, all of that is very, very manageable and we feel like if there is going to be significant increased inflation because of market-driven or because of federal minimum wage, we think everybody in the restaurant industry is going to have to pass those costs along to the customer.”
• ALLE (Industrials): “This guide incorporates pricing actions to offset direct material inflation, as well as reflecting our supply chain capability to mitigate industry challenges on supply and electronic component shortages. We anticipate that these challenges will persist for the balance of the year, and we will continue to monitor and adapt to changing market conditions.”
• WHR (Consumer Discretionary): “The global material cost inflation in particular in steel and resins will negatively impact our business by about $1 billion. We expect cost increases to peak in the third quarter.”
• PNR (Industrials): “All inflation remains high. We have instituted a number of selling price increases across the portfolio that we expect to help mitigate inflation in the second half of the year.”
• TSCO (Consumer Discretionary): “Compared to our initial outlook for the year, our forecast does reflect higher transportation costs and product inflation. We experienced increasing pressures from these factors during the first quarter and expect them to continue to be a headwind throughout 2021.”

Confirming this point, below are several comments from the recent release of the Kansas City Fed's April Manufacturing Survey which illustrate the breadth of cost increases that companies are currently facing. Labor shortages stand out prominently among this list of quotes.

• “It is very difficult to handle the increased business with supply chain issues across all materials and finding anyone who wants to work. The federal government has incentivized people to stay home and not be productive.”
• “Stimulus and increased unemployment money are wrecking the labor pool. Lower level employees are quitting to make just as much not working.”
• “Unemployed workers have no incentive to return to work given the COVID bonus payments.”
• “Entry level pay will need to be increased. This will create pressure on all other positions.”
• “We believe the shortage of workers is not an impact from the 2nd stimulus as much as a systematic problem of the gig economy and simply not enough workers for unskilled and critical skill positions. We are focused on retention.”
• “We are facing significant supply chain problems due to COVID-19 issues, tariff issues, and the weather problems in Texas earlier this year.”
• “Steel market needs to become stable. Steel producers recording record profits, while downstream suffers margin erosion.”
• “Largest raw material provider is refusing to deliver previously accepted purchased orders at accepted prices - demanding 18% price increase to fill previously accepted orders of flat rolled USA stainless steel.”
• “We could greatly grow our business if it were not for steel and labor issues. We could get more orders and employ more people. Supply chains are a mess and we cannot get people to apply. We pay upwards of $20 or more per hour with full benefits.”
• “Liquidity is the BIGGEST issue. Ramp up of production is stressing cash more than usual since we depleted cash during the downturn more than what would have been typical.”
• “The labor shortage is driving up the price of most proteins in food manufacturing.”

 

[hiwall]

A few years ago the Federal Reserve started borrowing money to banks every day. The banks borrowed a lot at first then it mostly died out. But for the last several months the banks are back with their hands out again. Today, banks borrowed $183 billion. It varies everyday from about $30 billion to a high of well over $200 billion. All at zero percent interest.

https://apps.newyorkfed.org/markets/autorates/temp

 

[WVDragonlady]

Glenn Beck just did a section on the BoA earnings calls and the hyperinflation that is coming.

As I've told the hubby if you need it or will need it in the future get it now. Get the order in now

He needs to go to Va to start getting more gas and diesel but got sidetracked by a project here at the house that should be finished this weekend
I'm working on spices that doesn't grow here and are imported

I've been telling people they better step it up and get things now and not wait

 

[Neb]

Glenn Beck just did a section on the BoA earnings calls and the hyperinflation that is coming.

As I've told the hubby if you need it or will need it in the future get it now. Get the order in now

He needs to go to Va to start getting more gas and diesel but got sidetracked by a project here at the house that should be finished this weekend
I'm working on spices that doesn't grow here and are imported

I've been telling people they better step it up and get things now and not wait

I am currently listening to Glenn's show now but it looks like these 3 videos cover the hyperinflation.





How YOU can protect your money & prepare for troubling times | Economy Update PART 3

https://youtu.be/0kqE3sNulvo

I hope this helps.

Ben