Everyone expected a recession. The Fed and White House found a way out.
Everyone expected a recession. The Fed and White House found a way out.
The economy’s strength and stability — defying even the most optimistic predictions — represents a remarkable development after seemingly endless crises
The economy’s strength and stability — defying many of the most optimistic predictions — represents a remarkable development after seemingly endless crises
As 2023 winds to a close, Powell and his colleagues are far from declaring victory on inflation. They routinely caution that their actions could be thwarted by any number of threats, from war in the Middle East to China’s economic slowdown. Americans are upset about high costs for rent, groceries and other basics, which aren’t going back to pre-pandemic levels. The White House, too, is quick to emphasize that much work remains.
Yet the economy is ending the year in a remarkably better position than almost anyone on Wall Street or in mainstream economics predicted, having bested just about all expectations time and again. Inflation has dropped to 3.1 percent, from a peak of 9.1. The unemployment rate is at a hot 3.7 percent, and the economy grew at a healthy clip in the most recent quarter. The Fed is probably finished hiking interest rates and is eyeing cuts next year. Financial markets are at or near all-time highs, and the S&P 500 could hit a new record this week, too.
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Yo ngl I cannot care one iota about the S&P 500 when food costs nearly double what it did before the pandemic and rents are skyrocketing.
Where I am, the $5 eggs are back down to $1.80, and the $6 milk is $2.89. Feels the same as before-times.
It's hard to find restaurant lunch under $15, which is around 50% more than 2019, and even the gyro counter added a default tip when they stopped accepting cash. That's sad, but I cook more now.
2 years ago yogurt was 40 cents, today it’s 80. Bacon was $3 a pound, today the cheapest is $4.50 unless it’s on sale. Frozen pizzas were $4, $5 on the top end, now they’re $6-$15… for a frozen pizza. Ramen was 20 cents, today it’s 55. String cheese was $4, today it’s $7. A small bag of shredded cheese was $4, now it’s $8. Cereal was $3, today it’s $5 and you get less. Have you seen how expensive a bag or Doritos is? A small bag costs more than what a party size bag used to cost, and that’s true for all chips.
I have dozens of items that are out of reach today that were common fare 3 years ago. Milk and eggs have come back down, yes, but not the rest of it.
I guess my response is that most of what you've listed are significantly-to-highly processed foods, and I lump them in the same bucket as 'restaurants.' To me, it's not that the food has gotten expensive, so much as corporate structures are 'extracting more value.' And I do realize that a lot of people are in situations where those processed foods are their only practical options. I just think that General Mills, PepsiCo, and Blackstone deserve the blame and hate, more than 'the economy.'
BTW, I would love me some $4.50/pound bacon. I don't remember it less than $6/12 oz in the last 5 years, except occasionally on sale. I used to see fairly regular $1/pound pork shoulder sales, and I haven't seen that under $1.80 in a while, so there definitely are basic foods with inflated prices. My personal experience is that I still get out of the grocery store for the same $40 I was spending in 2018, although I have also given up chips and started making my own yogurt. Switched from beef to chicken, pork and beans, although that's more for carbon reasons than cost.
Here from Europe, a similar situation.
Some things are still expensive, but a lot of things have gotten better.
Moreover, salaries did increase, so I can't complain too much.
We are extremely fortunate to have so easily beaten this round of inflation.
It's mostly the same here.
Grocery prices have definitely gone up overall in my part of the world, but outside of outliers (or outright liars), prices aren't double. But lots of people around here will claim their grocery bill is double what it was before covid. In general, I'm not willing to say any specific person's "twice as much" isn't true, I don't know their circumstances, but my experience and pretty much all the reports I've seen don't bear that out (again for my part of the world).
The egg thing was a prime example. People were going around saying "eggs are $10 now" but then when I'd look at the local grocers, it was only the premium brands' free range, organic, woman-owned, holistic, fair-trade type eggs that were anywhere close to that -- and it was always the type of person that you know never bought those types of eggs to begin with.
I have seen a lot of convenience and luxury grocery items that I used to buy have gone up around 50% or gone down the shrinkflation route. And for sure, there's been an uptick in temporary shortages and price spikes.
Restaurants around here are also like you mentioned. Prices have really gone up there. I don't eat fast food often, but a month ago I was traveling and decided to get fast food breakfast at one of my old favorites. A biscuit and a drink used to cost around $3, now it's nearly $8. Last year, I had a craving for Wendy's and it was similar, the food that used to cost me just over $4 back in the day is now a bit more than $11. But then again, eating out is a luxury in pretty close to all circumstances.
I feel you, but there's not much Biden can do about either thing.
Unfortunately, he will get the blame for it anyway.
I feel you, but there’s not much Biden can do about either thing
Weird the article is giving credit to Biden for inflation then...
It's just getting old that if something good happens, Biden gets credit. If something doesn't get fixed, then it's not his fault because he's just the president.
It's the type of stuff I'm used to only hearing from Republicans.
I mean. At the absolute bare minimum the White House should understand how this comes off to voters like the person your replying to.
All it does is highlight how voters aren't the concern, it's the wealthy who have already made huge increases in the wealth since 2019.
"Nothing will fundamentally change" he told the wealthy before he was elected. And credit where credit is due, Biden has kept that promise to them.
Within any adminstration there will be things in and outside of their sphere of influence.
What's often attributed to Biden himself can often more accurately be attributed to his cabinet as a whole.
When people say it's not their fault they often mean the issue at hand needs a Senate resolution which will never happen because it's controlled by the Republican party who has a "do you enemy no favors" policy whenever a democrat is in office.
So what did Biden do for this?
The article says:
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Skyrocketing interest rates.
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Increased fossil fuels drilling
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And forcing ports to operate 24/7 to flood the market with imported consumer goods.
All things that have massive negative effects on the average American, but help large corporations and the wealthy who own them.
Which brings us back full circle to OP's complaint that this victory lap is celebrating something that only benefits the most wealthy Americans and fucks over the rest of us.
Is that what we're supposed to be congratulating Biden on?
Is this honestly going to convince voters that Biden cares about them? Because according to polls, they don't feel like that, and that will depress turnout which is the only way Republicans can become president.
The article says:
No, it doesn't. The article says:
- Skyrocketing interest rates.
- Increased fossil fuels drilling
- Forcing ports to operate 24/7 to flood the market with imported consumer goods.
- Tapped into the strategic fuel reserves
- Resisted calls for price controls
- Pursued major new federal spending programs
It also says that 3 helped cool price shocks, 6 flooded the market with new workers who saw wage gains and helped increase demand, 1 helped keep the housing market out of recession, and the combination of 1-6 helped stave off major, economy-wide layoffs. All of these helped the average American, but somehow you filtered the entire analysis through your myopia-lens and latched onto the most damning interpretation you could muster. Wonder why you did that...
So...
You're saying the article lists three more things that helped the wealthy.
And one of your examples for how that helps the average American is it kept housing prices high?
And you know what avoids layoffs and actually helps workers? Fixing the actual problem which is out of control wealth inequality.
Even just trying to do something about that would pretty much guarantee Biden gets a second term.
You’re saying the article lists three more things that helped the wealthy.
Nope.
And one of your examples for how that helps the average American is it kept housing prices high?
Low inventory keeps housing prices high, numbnuts. Supply & Demand. It's not rocket science, and the President doesn't build houses.
And you know what avoids layoffs and actually helps workers? Fixing the actual problem which is out of control wealth inequality.
So we're back to ignoring things a single American president does have control over in favor of things they don't?
Good talk, chad.
Good talk, chad.
It's depressing how much trump supporters and Biden support act alike.
Economics! hOw DoEs It wOrK?!?!?!
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It's not just the stock market. There's a wide range of metrics which are showing an improvement, and they're comparing with what didn't happen, which was a recession.
What hasn't happened is a rollback of the Reagan-era change in distribution of wealth and income. That requires getting congress to act.
That falls on your local economy and state and local elected officials. Rent is always due to local officials and how the zone the city. Local and State Corporate taxes also play a role in higher prices. If I were you, I'd check the local city council schedule and speak on those concerns.
Plus, counterintuitively, rent is starting to fall in many major metro areas because we're finally seeing a notable uptick in inventory. The price of a dozen eggs is back in the neighborhood of where it was pre-Covid, and the price of a gallon of gas has wiped away almost all of its 2023 gains and is now back to roughly what it was before Russia invaded Ukraine. Not saying people across the board aren't struggling since the pandemic, because I'm sure they still feel it in a very real way, but prices are very obviously stabilizing across the board and the S&P is obviously responding to really solid underlying trends.
Wasn't there a big controversy regarding price-fixing with national rental management companies? Yes, local policies will have a significant effect on local areas... but they're far from the only ones affecting it.
The meat industry was fixing prices in 2022. The White House addressed the issue and called them out on it.
Can't really price-fix in the housing market if there's an increase in supply - it's the same problem we've had since the teens. We are not building enough.