Okay, but at least where I live, prices that increased due to covid haven’t come back down. Supply is now high enough to satisfy demand, but prices aren’t dropping. Of course, why would they? It turns out that customers have self-selected that they really don’t want to starve or be homeless. Even if it wipes out most of their income.
No, prices don’t come down. That’s not how economies work. People get raises. In a healthy economy, wage gains outpace inflation. Purchasing power goes up even though prices haven’t dropped.
Our current US economy is not healthy - it’s “K-shaped” with the higher-earning consumers (top 10-ish percent) doing so well they overwhelm the average across the entire economy to make the overall numbers “good” even though people in the bottom half or so are struggling. So most people aren’t seeing the purchase power increases that they should. But if things were healthy, it would be wages increasing faster, not prices coming down.
Okay, but at least where I live, prices that increased due to covid haven’t come back down. Supply is now high enough to satisfy demand, but prices aren’t dropping. Of course, why would they? It turns out that customers have self-selected that they really don’t want to starve or be homeless. Even if it wipes out most of their income.
No, prices don’t come down. That’s not how economies work. People get raises. In a healthy economy, wage gains outpace inflation. Purchasing power goes up even though prices haven’t dropped.
Our current US economy is not healthy - it’s “K-shaped” with the higher-earning consumers (top 10-ish percent) doing so well they overwhelm the average across the entire economy to make the overall numbers “good” even though people in the bottom half or so are struggling. So most people aren’t seeing the purchase power increases that they should. But if things were healthy, it would be wages increasing faster, not prices coming down.