Will prices in the US ever come back down?
Posted by Batmon3@reddit | AskAnAmerican | View on Reddit | 166 comments
Everyone is struggling right now financially besides the few.
I wan to know if prices will ever come back down? Groceries are insanely expensive now.
Will wages increase to help combat that?
Will the housing market crash?
I just want a better economy man, this shit depressing.
WaltKerman@reddit
That's not how inflation works. It never goes back down. But wages go up too.
NotDonMattingly@reddit
lol but wages don't go up nearly as much or as fast as prices....sooooo
WaltKerman@reddit
They do, but there is a lag effect. If people can't buy good, they demand drops and prices go down as supply increases. The world has been around a long time and it keeps balancing out. The Romans have chiseled in stone their struggles with inflation. One empires set a price cap because he didn't understand it and it caused food shortages eventually.
Before covid in the US, most sectors including housing had dropped the last 20 years compared to wages. Education is an example.
After covid we are still dealing with supply chain disruption with things not even involved with covid. Housing has definitely lost ground over those three years. But it's because people are still buying despite the elevated prices.
NotDonMattingly@reddit
OK but a lag time of 10 years or whatnot makes this meaningless to the individual person who's suffering. If milk, gas, groceries, and rent go way up but my industry doesn't raise wages for YEARS, this is no help to me.
WaltKerman@reddit
It shouldn't be ten years unless, lag time should be a year and especially for milk eggs and groceries which have a larger turn around time.
Grocery stores had a margin of less than 3% for 2023. It's already squeezed tight. If wages in your industry haven't gone up in a decade it's time to switch industries.... otherwise you are telling them that's how much your labor is worth.
liberty340@reddit
They sure are taking their sweet time
vwsslr200@reddit
Real wages are up from before the pandemic. Most Americans are better off than they were before the pandemic. Low income people more than high income people.
cdb03b@reddit
That is a lie.
Wages have gone up, but they have not kept up with rent, grocery, and fuel increases.
vwsslr200@reddit
It's a literal fact, though.
https://home.treasury.gov/news/featured-stories/the-purchasing-power-of-american-households
cdb03b@reddit
People judge real wages by how easily they can afford food and rent. They cannot do either so claiming it is increasing is false no matter what data you throw until those two things are affordable again it is not increasing.
haha_im_in-danger@reddit
That's not remotely accurate. Rent is rising faster than wages.
vwsslr200@reddit
Nope, it's isn't:
https://home.treasury.gov/news/featured-stories/the-purchasing-power-of-american-households
haha_im_in-danger@reddit
In the past 5 years, wages have raised 20 percent. Rent is up 30 percent. Don't cherry pick one stat to make your argument.
vwsslr200@reddit
You're the one cherrypicking stats. I'm using real wages, which takes into account prices changes for a properly weighted complete basket of goods. You're just looking at rent in isolation. Though even for that, I would like to see you cite a source for those numbers since it disagrees with the one I'm using:
https://home.treasury.gov/news/featured-stories/the-purchasing-power-of-american-households
Library_IT_guy@reddit
No? Yes, wages have gone up a little, but rent or the cost of a house has nearly doubled. Food prices are close to double. Fast food prices are up so much that most of the middle class around here won't go anymore. I skip breakfast and lunch to save money. And I'm better off than most, since I have both a full time job and run a successful business on the side.
vwsslr200@reddit
Rent has not doubled, you're full of crap. It's increased more slowly than median income. Food has indeed increased faster than median income, but that is outweighed by the many other things that have increased slower.
WaltKerman@reddit
Houses, yes, apartments no. And depends on the city.
The person you are arguing with and you may be in vastly different areas.
Personally I think you are both wrong... he's wrong... but also you aren't correct in that average rent increase has doubled.
vwsslr200@reddit
I'm not in the US at all. I'm not basing it on my anecdotal experience in my area, I'm citing the actual data.
https://home.treasury.gov/news/featured-stories/the-purchasing-power-of-american-households
sleepyj910@reddit
Well, we gutted the unions so…
xxxTHICCJOKIC420xxx@reddit
Lol, wages are never going to match the rate that everything else is going up.
2018_BCS_ORANGE_BOWL@reddit
https://www.axios.com/2024/02/05/wages-outpacing-inflation#
Inflation outstripped wage growth for a couple years after COVID. Now wage growth outpaces inflation, as it did before COVID since ~2012.
Never ceases to amaze me how just understanding like… 5 relatively simply numbers (inflation, interest rates, wage growth, unemployment, GDP growth…) will give you a pretty good view into the economy, yet almost everyone just completely ignores the numbers and makes up their opinion based on their gut feelings.
therealdrewder@reddit
The only thing that isn't inflating is my paycheck.
AFoxGuy@reddit
When even Rhonda Sandtit’s Climate-Denial Florida decided to raise it to $15+Yearly Inflation Increases… you know shit is just fucked up.
MarduRusher@reddit
It can, technically, with deflation. But that probably isn’t good either.
rileyoneill@reddit
Yes. Prices of things do come down all the time. Look at technology, nearly every component of technology follows a pretty aggressive cost curve every year. Go look at ads for things like TVs in the 1990s. Then figure that 30 years ago, a dollar was worth roughly twice as much as it is today (and, if you are not keeping track, 1994 was 30 years ago!).
https://imgur.com/a/best-buy-sale-ad-from-october-23-1994-Pu3Vf
Figure, take anything you see in this catalog, double the price and thats what it would be like today. Then take anything you have today, half the price, and thats what it would have been like buying it back in 1994.
A $800 iPhone 15 today would have been $400 in 1994. Drastically cheaper than those shitty camcorders you see. Way cheaper than something like a TV. And tiny compared to those desktop PCs.
That desktop PC that is $2000 in that catalog, that would be like buying a $4000 PC today. That 46" inch TV in the catalog was $1550 or so. That would be like $3100 today. This TV is huge, sucks a lot of energy, isn't HD. You can get a TV that size to day for like $200.
Other things are also coming down in price, and they will start to affect society. Solar panels and batteries have been dropping in price. The production cost of batteries dropped 85% between 2010 and 2020, and prices are still continuing to drop. Solar panels have also come down in price something like 80% in that same duration, once again, production costs are still coming down. This means that $100,000 buys like 5x as much solar panels post 2020 than it did pre-2010.
Energy is a fundamental unit for everything. Every single business operation requires energy as an input. This on site solar/battery is going to allow people to save money on a fundamental cost. Households will start to save money, utility companies will. Every manufactured item (which includes food) has an cost associated with the energy needed to produce and ship that item to your store, and all those costs are going to be coming down.
Businesses will charge as much as they can to customers. If their cost structure drops, they will still charge the most they can, but anytime there is a window for competition, some business will take it. We are in an era of high prices right now and that creates a lot of pressure some store to start lowering prices to have an edge over the others. We are also going into a labor shortage as the big giant Baby Boomer generation all head into retirement and the much smaller Gen Z age into their working years. For the first time in living memory, and only for the last few years, the number of people retiring from the workforce is greater than people aging in, and the difference is a a few hundred thousand per year. To scale this down to a town of 33,000 people. The difference is about 35 people extra retiring vs young people entering the workforce. This may not seem like much, but it is a deficit, a deficit that keeps building every year. It would be like 435 people that town retiring, and 400 people aging into the working age, and 35 jobs going unfilled.
Housing prices are expensive due to scarcity. Scarcity in some areas push buyers into other areas, which brings on more scarcity. I am from a commuter city. 30,000 people from my city commute into other major Southern California job centers. If these other cities get their housing situation fixed and allow for enormous amounts of housing to be built, it gives an alternative to the commuter, which reduces demand for housing in my area.
The last time housing was this expensive, we saw a monster market crash. This will not last forever. That which can't go on forever eventually stops.
trampolinebears@reddit
Prices falling across the board is what we call deflation, and it’s an absolute disaster for an economy. Deflation means your dollars will be worth more tomorrow, so you’re better off sitting on them. Everyone has an incentive to stop investing in things and interest rates go up.
Traditional_Entry183@reddit
So for people who haven't seen their wages go up much in the last twenty years, what's the individual solution? Prices were pretty stable for ages for many things food especially. Now most cost double to triple what they did five years ago, but I don't make any more money. I was already eating CHEAP food, so I wasn't overspending before.
roguebananah@reddit
If your wage hasn’t gone up in the past 20 years you need to demand a cost of living wage increase
Or
Better yet look for a new job.
haha_im_in-danger@reddit
Such a conservative bullshit take. Screw you if you don't have the means or ability to find a better job.
PPKA2757@reddit
someone suggesting that an individual is responsible for their own well being makes them a conservative?
Now that is a bullshit take.
haha_im_in-danger@reddit
Just pick yourself up by the boot straps, am I right?
roguebananah@reddit
Ah yes. I’m a conservative because I said if your employer is paying you terribly and you’ve gotten ZERO pay increases in TWENTY years but yet their company prices surely have increased, I’m the guy to attack.
This guy saying they’ve NEVER had a chance to look…in that long of time period. They shouldn’t even look?
I’m liberal but goodness. This isn’t even a political take. It’s just even looking what’s out there and trying to better your life
rileyoneill@reddit
Wages have gone up, but not in relation to cost of living. The issue that as a society we need about 20% of our population to work service jobs just so we have the services we require in a city. Someone has to work the retail jobs, someone has to work at the grocery store. Someone has to work in child care and elderly care. These are all jobs that we require to go fulfilled, and they are generally low paying.
When entry level homes go from under $200k in 2012 to over $550k in 2024, there is no good jobbing your way out of that. The overwhelming vast majority of employed people cannot afford to buy into society. So minimum wage has gone up from $10ish to $15-$16ish. Fine. But now entry level apartments are nearly $2000 per month, even old places that were $120 per month in the mid 1970s.
Cities like mine, the median household income is around $80,000 but the median home value is over $600,000. Our city isn't full of a bunch of rich people or super well paying jobs, it just has a ton of homes that people have owned from back when prices were drastically cheaper. How do people respond to this? They live rent bedrooms and live several people per home.
The big thing people are investing in isn't businesses, especially businesses that manufacture things, they are investing in homes because they know housing is scarce and rents are going up. Want a solid retirement plan? Own rental properties. Even shitty ones. Build an ADU in the back yard and rent it out as well. $100k cost for $2000 monthly income.
Traditional_Entry183@reddit
Not everyone has that opportunity, unfortunately. I was laid off after having my wage cut once, then later found another job where I've worked my way to about where I was. And this is retail, so I'm not rolling in money.
roguebananah@reddit
Youre right not everyone has that chance
HOWEVER you’re telling me not ONE time in TWENTY years you couldn’t have made a change?
Not to another industry? A rival? Nothing?
I find it exceptionally difficult to buy
Traditional_Entry183@reddit
People who work blue collar jobs don't exactly have industry rivals. I'm a freaking retail manager, not a lawyer or tech guy.
roguebananah@reddit
Business is business and they have to draw a profit .
They all have competitors brick and mortar retail has online as a competitor. No matter how many, your retail, blue collar job whatever does NOT have an monopoly
Another question
Has your company’s prices gone up? They have? So why don’t YOU see any of it? Your prices have gone up to live.
Traditional_Entry183@reddit
Wages don't go up because employers don't give a shit about their employees and know that if one person quits, they have a long list of others who will fill the job, maybe at a cheaper wage. You can't fight back, all you can do is grab tight to whatever you have and hope it lasts.
roguebananah@reddit
If your employer doesn’t give a shit about you, THEN LEAVE!
You CAN absolutely fight back. It’s by looking for another job even if it’s another industry. It’s not easy. I get that. Yes everyone’s situation is different but you’re telling me you haven’t, at ANY POINT thought hey. Let me ask for a raise. If they say no, then look for another job while you’re employed still.
It can be tough finding another job at times, I know it can be but that’s the best part of looking while you’re still employed…You don’t have to leave until YOU are ready to leave.
Take ownership for your situation than saying it’s everyone’s fault but yours. This is absolutely something YOU need to own.
trampolinebears@reddit
The problem is how much risk you can bear.
A few years ago I moved to a higher cost-of-living area for a better job. It was an expensive move, and I had to borrow money to do it, but it was worthwhile for the increase in pay.
Then the job disappeared, right before I was supposed to start. So I was stuck with no job, more debt, having moved to an expensive area.
Life’s a gamble. Sometimes you win, sometimes you lose.
Someone in a better financial situation could afford to roll again. I couldn’t. I searched for a job for a while, getting further into debt, then found a temp job at the end of 2019.
Today, I’m in a job that mostly pays the bills. It’s not great, but we’re surviving. I can’t find a better job here, so should I move to a different area?
Again it comes down to risk management. I can’t afford to take on the risk of subjecting my family to homelessness, even if that risk is somewhat low, so I stay where I am and keep a roof over our heads.
roguebananah@reddit
For the here and now, the risk you put in looking for another job is 0%. If you don’t find one, you stay where you are now. If you do go, yeah it’s a risk but the reward is for a better life.
Sometimes you do win and sometimes you do lose. Totally. However, if your means aren’t making your ends now…inflation won’t stop. The cost of living will always continue to go up. You will be worse off in the future than you are now if your income stays the same. It WILL be tougher as time goes on if not impossible.
I don’t know you but I’m telling you.
You need to figure this out and stop accepting the current status quo. If it’s moving back home (if you can), getting a second job to bridge you to one good paying job, furthering education, whatever it is, I promise you. If you don’t you will only find it harder as time goes on.
I’m being alarmist here because it happened to my family growing up. I never saw my Mom because she worked 3 jobs. She was my best friend. She still found time for me even though she worked so hard to keep her head above it all.
End of the day you can say it’s whatever’s fault. Society, industry, sector, background, current living…etc but end of the day YOU need to figure out how YOU can make your life better.
trampolinebears@reddit
It’s worth it if it works.
If I could afford to get a degree or do some sort of certificate, I would. With my medical condition, I’m struggling just to do one job. And there’s no home left for me to move back to.
I’m not blaming anyone, the situation is what it is. But all the changes come with risk, and I’m afraid of how much danger I’d put us in by taking that risk, especially after how much I hurt us by the last big risk I took.
roguebananah@reddit
I get it and if there are medical issues at play, which I’m sorry to great about, there are state assisted programs you could qualify for, educational classes community colleges offer and beyond.
California is very progressive thankfully. Reach out. Talk to someone based upon your medical and state’s help. You’re thankfully not alone in any situation
trampolinebears@reddit
I appreciate the sentiment, though it doesn't line up with what I'm actually facing. If you want to have more of a conversation about the specific situation I'm in, we could have that, but I feel awkward getting more into it in front of everyone.
I wish I had a better sense of how other people are faring, but I just don't really know anyone else.
thephoton@reddit
Your company doesn't have rivals? If you've worked for Penny's for a few years, see if you can get a job at Macy's, or REI or into some more niche retail business where the commissions will be better.
Traditional_Entry183@reddit
My one store merged with a rival, and scores of stores were closed and people laid off, myself included. No chance to relocate, just go away. After I eventually found another job, I feel lucky to even be employed a lot of the time. I make an hourly wage, and will never again go salary after a hellish experience at that for a few years.
I'm always on the lookout for better options, but most places pay people about the same or less, and many barely have any full time employees to begin with. Life is absolutely more difficult today than it was a few decades ago.
thephoton@reddit
Definitely on a scale of decades people in your situation are worse off, I can see that.
I didn't know how it is in Virginia, but in California the minimum wage increased from $10.50 to $15.50 since 2017. That's up almost 50%. Hopefully that's doing something to improve things for the people in the toughest jobs.
Traditional_Entry183@reddit
Virginia's minimum is finally going to go up, but thankfully I haven't worked at that level in a long time. But the problem is that the wages for other people are pretty stagnant, leading to a smaller gap between the lowest paid new employees and the ones who've been there for a while. So if a new worker makes $12, the manager making $18-20 is just slightly better off.
roguebananah@reddit
Minimum wage will never be a livable wage. It’s a fact.
You need to figure out okay. Here I am today. I’m not okay financially. How do I get myself to a more scalable living situation? Is it moving back home (if you can), it’s getting a certification to further education for a better job…etc and once I do X and Y I’m in a much better situation.
I can tell you now, it will NEVER get cheaper or easier if you’re never getting pay increases. Inflation will always happen. Economics demands as unfortunate as it is. Deflation is a death spiral to an economy
I’m not trying to be an ass here but in in 5-7 years, when it’s 5-8% at a bare minimum… How are you planning on living?
The_Law_of_Pizza@reddit
The type of person you're talking to will have excuses forever about why they have failed to thrive.
roguebananah@reddit
100%
This is going beyond the original question and going political but I’m absolutely a liberal. I believe in helping those who help themselves and not shrug your shoulders. If this guy said for a couple years I’ve had a bad paying retail job because of a new child, dude. I’d get it. It sucks. You do it and get out. But TWENTY YEARS?!
THIS mentality infuriates me because THIS is exactly the argument that conservatives use to say we shouldn’t help anyone.
God. I read this and got pissed at this mentality.
Traditional_Entry183@reddit
I don't want to fucking thrive, man. I don't want power or influence or anything special. I want to go to work, do a solid job, earn my pay and go home and live my life. And I want to be able to afford the basics that go along with that. Plain and simple.
ZigZach707@reddit
Then get a union job.
Traditional_Entry183@reddit
Yeah those are just everywhere to be had. So easy.
ZigZach707@reddit
Lol, my entire immediate family is unionized. Some in blue and others in white collar. Maybe Virginia just sucks and you should be applying out of state.
Traditional_Entry183@reddit
I knew a few union workers when I was a kid in WV in the 80s. My grandfather was as a coal miner. I don't think I've known a single one in my adult life. Many places don't even hire full time employees outside of a handful of managers.
ZigZach707@reddit
Then start planning your exit strategy.
Traditional_Entry183@reddit
When I was relocated by a previous employer to where I am now, I met my wife who's family is all right here. I'll be here forever.
zeezle@reddit
What are you buying? It could be regional but the staple ingredients I buy haven't gone up more than 20%, some are actually cheaper now than in 2019 or the same price. I'm just confused when I see people say that their food tripled in price because where I live it just didn't do that at all. The only things that have gone up that much are like processed national brands type food that people shouldn't be eating much of anyway and fast food. Even restaurant food (at actual restaurants that are not fast food) hasn't gone up even 50%, much less doubled or tripled where I am.
trampolinebears@reddit
I have no idea what the solution is. I’m in the same boat as you — I’m trying to cut grocery spending even further because it’s the only cost left that I can do anything with, and we’ve already cut so far.
roguebananah@reddit
See above but if your cost of living hasn’t gone up, you need to demand better from your employer
Or
Better yet look for a new job with better wages.
In other words, the cost of everything has gone up but your employer’s cost of wages are the same? Not how that works
trampolinebears@reddit
I would, but all my training is in a dying industry. It’s hard to find any work at all.
joepierson123@reddit
So what's your weekly grocery bill?
rileyoneill@reddit
It depends. People will not hold off food purchases if they feel food prices will be cheaper in three months. People do not hold off tech purchases even though technology is highly deflationary. If insulin prices dropped I don't think diabetics would be facing dire economic consequences. The same with rentals. If people who are struggling to pay rent had the option of renting another comparable price for 40% the cost they are currently paying I don't think that will somehow bother them.
Kitahara_Kazusa1@reddit
The problem would be that the people struggling to pay rent now would still be struggling to pay 40% of the rent in the future, because they'd have been laid off and would have 0% of their income.
It's not like everything else stays the same but prices go down, that would be nice but it isn't how things work
rileyoneill@reddit
Why would they be laid off? Would everyone be laid off?
fixed_grin@reddit
There are two ways general deflation can happen. One way, which is very rare, is that a bunch of technology spreading makes production much cheaper all across the economy. There is basically the same amount of money but far more stuff to buy, so prices fall. Think like TVs, but for everything. This is not ideal, but okay.
The other way is that production doesn't increase, but people have less money. Same effect of more stuff to buy per dollar, this time because there are fewer dollars. This is far more common, because governments can just do that, but they can't just press the "make more stuff" button. This is a disaster.
Because normally when prices fall, people buy more stuff, which pushes prices back up. If prices fall and keep falling, that is telling you that people are responding to lower prices by spending less. That means they're too broke or afraid to spend.
So, companies are getting less income and are cutting prices to try to survive, which isn't working. So they'll cut their own spending, AKA spend less at other companies and cut jobs.
This means people have less money and more fear, so they spend even less, which means more job cuts, repeat.
The other thing is that deflation makes debts worse. If the dollar gains value, me owing $10,000 means I owe more value. Same for a company owing $10 million.
AdmiralKurita@reddit
Riley believes in the "very rare" case. He thinks self-driving cars and robotic construction workers would make housing cheaper. Energy would be cheaper due to falling solar and battery prices. Also, lab grown meat would be cheaper.
rileyoneill@reddit
Did the printing press make books cheaper? Would 15th and 16th century Europe been better off if they didn't let printing presses flourish?
Energy is already becoming cheaper because of falling solar prices. People will really be able to economize their energy when home battery prices hit a certain price point that it justifies home installations, and I have said that number is going to be around $100 per kwh retail price.
I don't think robots are going to be building homes on site, but I do think that factories are going to be better positioned to manufacture components that get installed in homes vs shipping raw materials to a job site and having laborers cut/join them into shape.
The lab meats have already went from $1M per kg in 2013 to less than $1000 per kg today. 1000x cheaper in 10-11 years. I am looking at the early-mid 2030s thinking, hmmm if it does that again... There is zero case for lab grown meats for $1000 per kg.
AdmiralKurita@reddit
I sincerely think there is a significant possibility that you are correct if the timelines are pushed a decade or two out. There are a lot of interesting technological developments, but they are not going to be commercialized within the 2020s or early 2030s. The 2020s is still a decade to sell the hype.
I even bet against the crowd by predicting that birth rates would be above replacement in 2055 or so.
https://www.metaculus.com/questions/12262/date-us-total-fertility-rate-reaches-21/#comment-156893
As for lab meats, I will simply say it will not happen on a quick time frame. All that really matters is that it fall from $100 per kg to $1 per kg by 2040. The biotechnology may stall.
rileyoneill@reddit
I think the solar panels and home batteries are going to be a big thing in the 2020s and 2030s. The hype has been going on for the last 30 years. The home battery at the right price isn’t with us yet. But I put that on my list of things that will get here sooner. We are already seeing a lot more solar wind and stationary battery storage investments. If we see that continue to accelerate there will be a lot more of it 2029 than today and certainly more than 2019. Cheap costs are going to justify more investment.
The RoboTaxis are already a thing. They are just extremely limited. I could see them hitting a price point that is cheaper than Uber in markets where they are permitted this decade. I figure they will follow a similar progression curve to other technologies. Compare say 1997 to 2007 with digital photography. 10 years is a long time for fast moving technology. Look at how common EVs are compared to 10 years ago.
The food things. I actually think it’s going to be mostly ingredient lead. The actual lab made steak will happen last. But lab produced milk and cheese will hit first. Making whey is a lot simpler than making a steak.
rileyoneill@reddit
Deflation from technology isn't rare. It is constantly happening. And its generally a very good thing for people as it allows them to get things they want or need for less and have more money left over for something else. It also makes some things viable in the first place. Solar panels were nearly $1000 per watt in the 1970s and are now under $1 per watt today. That is a good thing. The reason why we so much solar adoption in society is because of declining prices. The government has put their hands on the scale a bit but the big driver is dropping cost.
Things like housing and food going down in price isn't a bad thing. The opposite is a bad thing. Rising housing prices create conditions where people can barely afford to live and many jobs that once paid enough to live no longer do. I don't think we will be lining up to pay entry level workers $80,000 per year so they can qualify for their $2000 per month 1 bedroom apartment.
This type of deflation makes paying off debts easier because there is more expendable income that people are saving.
Fiscal deflation is not the same as technological deflation. The opposite is what we are currently seeing, and it absolutely ruins economies. People can no longer afford to survive. Sky rocketing rent creates massive problems for people who need to rent, but is awesome for passive landlords.
We are not experiencing monetary or fiscal deflation and its unlikely that we will.
toomanyracistshere@reddit
Go to the "effects" section. https://en.wikipedia.org/wiki/Deflation
haha_im_in-danger@reddit
I, for one, welcome deflation and collapse. I work full time to make around 30 a year. Half of the country makes the same as me. This doesn't work.
Steamsagoodham@reddit
The median salary is about 60K a year so at least half the country makes twice as much as you.
haha_im_in-danger@reddit
That's the average salary. Median income is 37. 40 percent of the nation makes less than I make, based on 2022 census data. If you move it to 35k, it's now 45 percent.
On reddit it's mostly upper middle class white collar people. I get that most on here have no idea what reality is.
matthewwehttam@reddit
I believe they are thinking of median household income which is \~$75k (see https://fred.stlouisfed.org/series/MEHOINUSA672N or https://www.census.gov/library/publications/2023/demo/p60-279.html ). According to this report (https://www.census.gov/content/dam/Census/library/publications/2023/demo/p60-279.pdf) the median income is \~$45k. Given that that is 50% more than 30k, I would guess that significantly more than 50% of people make more than 30k.
haha_im_in-danger@reddit
based on this the numbers are lower.
You're guessing incorrectly.
trampolinebears@reddit
Do you think you’d be better off in an economic collapse?
haha_im_in-danger@reddit
Realistically? Probably be about the same. My children might have a brighter future if we scrap the neo capitalist system with a government that is bribed before they reach Washington.
Batmon3@reddit (OP)
Everything was better before COVID. I just don't think wages have increased since inflation went berserk.
Does it usually take awhile for wages to increase after inflation rises?
trampolinebears@reddit
Wages on the whole have increased, according to the statistics, but I think the wage increases have not reached enough people. And I think the inequity in wage increases is particularly a problem for people who have a larger portion of their income going to things like groceries.
fixed_grin@reddit
But wages have increased the most for the poorest.
trampolinebears@reddit
Maybe for some, but not for all.
boydownthestreet@reddit
Inequality is actually coming down, and wage increases are the strongest for less affluent workers.
AshleyMyers44@reddit
I think the other issue is that I believe rent has increased even more than wages on average.
Batmon3@reddit (OP)
I agree. So what is the solution to everyone living paycheck to paycheck?
DifferentWindow1436@reddit
Unfortunately, nobody can answer this for you. What I can suggest is do some things like look at what areas of the economy are growing, where job demand is, and where it is geographically as well. And sometimes you may need to make sacrifices or hard choices (like moving for a job or learning new skills while working) in the short ot medium term.
trampolinebears@reddit
I have no idea. I can think of a lot of bad ideas (like starting another trade war with China, or deporting half of our agricultural workers) but I don’t think I have any good ideas to compensate.
-dag-@reddit
Wages on average increased more than inflation. Of course that's an average and individuals might have seen something very different.
But by all the usual metrics the economy is quite excellent right now
conrangulationatory@reddit
As someone who was laid off from my job after 20 years I have not personally seen my wages increase. Went from $100k in 2022 to $50k in 2023 to $0 3 weeks ago. I understand you said average. But this sucks for me personally. Can’t leave the grocery store for under $100 and that’s not for a weeek or two. That’s one days needs often. I’m going to try to stop eating I guess.
SomeDudeOnRedit@reddit
Have you applied for unemployment or food stamps yet? You paid taxes for those benefits when you were working. Sounds like it's time you collect on those benefits.
-dag-@reddit
I'm so sorry that happened to you. Good luck with the job search.
conrangulationatory@reddit
Thank you nice person from the internet. I’m optimistic and have a lot of good in my life be well yourself!!!!
w3woody@reddit
No.
Inflation generally ratchets one way, as do salaries, generally speaking. What's important is how much stuff you can buy--and that will be a function of economic productivity. Right now there's not enough housing in large cities, for example--and that won't be fixed by lowering prices.
Expat111@reddit
Corporations have to deliver record profits quarter after quarter. They’ll continue to do whatever it takes to set new records. So, unless there’s a serious collapse of our economy and people just stop buying or people begin boycotting certain products, these are the new prices. And no, wages will not rise anytime soon enough to make it easier. Housing prices, however, I fully expect the valuation bubble to pop within the next few years. Housing bubbles always pop.
DerekL1963@reddit
Housing isn't in a valuation bubble, it's in a supply crisis. (As in there is more demand than supply.) It's not a bubble, it's a shortage - there's nothing to pop.
fixed_grin@reddit
Yeah, there's some froth on top that could drop a bit, but the basic problem is deciding to play musical chairs and auction off the seats. We just need to get more seats. We made a policy choice to have a housing shortage, so it's expensive.
Double wages and much of that will just push housing costs higher as property owners slurp it up.
DerekL1963@reddit
Um, no. We have a housing crisis because the construction industry cratered during the 2008/9 financial crisis. It hadn't even fully recovered when it got plastered *again* during the pandemic and the resulting supply chain disruptions. We've lost the better part of a decades worth of new housing starts. And we're not making much headway in making up that lack.
fixed_grin@reddit
No, we have a housing crisis because city governments make apartments difficult or impossible to build, and we've run out of cheap suburban land in commuting range.
DerekL1963@reddit
For areas where that's true and relevant, it no doubt contributed. However, the housing crisis is nearly universal in this country, and the situation you describe... isn't. It isn't even close.
fixed_grin@reddit
Yes it is. It's everywhere. We all got cars and built freeways post WW2, so suburbia spread in existing big cities. When they started getting low, A/C got common and the Rust Belt hit the skids, so people migrated to the Sun Belt, to mostly small cities with plenty of room for more suburbs.
This is also happening in countries all over the world, no matter how the financial crisis affected them, but not in countries where building apartments is generally legal.
mustang6172@reddit
Only if the economy collapses.
Batmon3@reddit (OP)
Is that something you hope for? I am only 21 and I feel like we really need it with how jacked up all the prices are. Or minimum wages need to increase drastically and quickly.
haha_im_in-danger@reddit
I'm older than you and I wish for it. If you're white collar life is fine. My life isn't struggling to pay bills while having to lie about my income to qualify for aid so my wife doesn't die.
talk_to_the_sea@reddit
When I was 17, gas was around $4.25 per gallon where I lived. That’s $6.41 in today’s dollars. Currently the average price of gas there is $3.32.
Karen125@reddit
When I was 17 gas was 69 cents. Adjusted for inflation gas should be $1.97. It's $5.79.
Karen125@reddit
Minimum wage increased drastically and quickly. Did not help.
docfarnsworth@reddit
no, if he economy collapses prices may go down, but many people will have 0 income.
Batmon3@reddit (OP)
True, that makes sense. So our only hope is that wages increase as inflation slows down. And that the housing market falls or crashes?
AlienDelarge@reddit
Be real careful what you wish for there too.
GhostNappa101@reddit
Yeah, the last thing we need is 10s of millions upside down in mortgages. I think the most we can optimistically hope for is for supply to stabilize and prices to go flat for long enough for wages to catch up.
DerekL1963@reddit
We've lost the better part of a decade's worth of new construction - and we aren't building nearly fast enough to make up for it. Barring a miracle, supply isn't stabilizing for the foreseeable future. (Say, the next half century or so.)
Decade1771@reddit
A whole lot of Babyboomers aren't living another half century though. It won't make up for everything that we should have been building but it will lessen the need some.
JViz500@reddit
There’s hope for revolution in construction. On-site 3-D printing for example. But very different houses people will need to get used to.
pasak1987@reddit
So many younglings were so young to remember the horror of seeing their families and neighbors getting foreclosed
AlienDelarge@reddit
Yeah, lets not do that again.
OverSearch@reddit
You've got to have a really jacked-up sense of economics to "hope" for the housing market to crash - or any other market, for that matter.
ESCocoolio@reddit
wage increases cause inflation. it’s a chicken and egg problem, which one came first?
buffilosoljah42o@reddit
Yeah, but inflation already happened so...
joepierson123@reddit
If wages increase inflation will increase. Supply and demand
docfarnsworth@reddit
overall inflation has slowed, but for many their incomes havent kept up so theyre still feeling pain. The hope is that overtime your income will increase faster than inflation so the pressure comes off. The issue is that for many people incomes rise very slowly and inflation at the best of times is still around 2% so its likely to be rough for a while.
haha_im_in-danger@reddit
Many have firearms to secure food.
JViz500@reddit
Rather than economic collapse to benefit you, a better option would be gif you to acquire skills that let you earn more than minimum wage.
Steamsagoodham@reddit
Hoping an economic collapse would make things more affordable is like hoping a nuclear winter would stop global warming. Maybe it gets you the one specific thing you want, but the overall cost is much much worse.
TheBimpo@reddit
Absolutely not. That means people lose jobs, homes, insurance, etc. You’re young, focus on your career, it’ll be ok.
toomanyracistshere@reddit
Overall, prices do not go down, and if they do, that's literally the worst thing for the economy. If prices in general started to decrease, there would be massive unemployment. That being said, some things can decline in price without a negative economic effect. I wouldn't be surprised if housing prices go down a bit in the next few years, provided there's a concerted effort to build more, and when we figure out more efficient ways to produce things, the price of them tends to go down, but really, what we need isn't a lowering of prices, but an increase in wages. This is already happening to an extent, but it's not spread perfectly evenly, so there are a lot of people whose earnings haven't caught up with inflation yet.
band-of-horses@reddit
Prices going down is very bad, we don't want that as nice as it sounds. When prices go down, profits go down, and people tend to lose their jobs or have to take pay cuts. When peopel lose their jobs they can't spend money, which tends to decrease demand for things and drive prices down more. On top of that, people tend to not want to buy things even if they can if prices are decreasing, because they know it will be cheaper if they wait to buy it, plus they see other people losing their jobs and want to play it save and maybe save their money in case they also lose their jobs.
It can be a pretty bad spiral, and we saw the negative effects of it during teh great depression where prices dropped for several years in a row.
What we want is price increases to stabilize back to a normal inflation level of around 2% per year and wages to start increasing a bit faster. Unfortunately any rapid change to either tends to be really bad so there's no quick way out of this.
LivingGhost371@reddit
How many groceries will you be able to buy if you're now unemployed because the economy has collapsed?
haha_im_in-danger@reddit
Or just go and take them
ZigZach707@reddit
Jesus, I hope you don't own guns.
haha_im_in-danger@reddit
Enough to hold off the state national guard for a few days.
ZigZach707@reddit
A gun owner promoting armed robbery. You're a special kind of naive. I hope you're on a watch list and get caught in some red flag program. You're a disgrace to 2A supporters.
haha_im_in-danger@reddit
My state doesn't do red flag nonsense. And none of my firearms are registered, or have any paper trail of ownership. Welcome to the south, friend.
And you mistake me for someone that would let my kids go hungry
ZigZach707@reddit
Can't wait until states like yours get pulled into the 21st century. You give the rest of us a bad name.
haha_im_in-danger@reddit
My state is regressing gun control, not expanding it. The feds don't have the authority to enforce California style gun control on the rest of us. Every election, it goes further right.
notthegoatseguy@reddit
Minimum wage has gone up in many states, some quite a bit.
In states that still have the fed minimum wage, their minimum wage could probably be raised to $12-15 without impacting the economy much because almost no one is paying the fed minimum of $7 an hour.
jimmyjohnjohnjohn@reddit
Hopefully not. That's deflation and is a sign of a contracting economy. You don't want that.
If the situtation improves, two things will happen: 1) Inflation will stabilize and prices will rise at a lower rate than wages. Eventually wages will catch up so that buying power will go back to what it was
2) Shrinkflation will reverse. Shrinkflation was a huge problem in the 70s along with inflation, then when things got better in the 80s you started seeing "NOW 15% MORE" or "20% BIGGER" plastered all over everything as they returned to their former sizes. Once one brand does it, the other brands are practically forced to do it to compete.
Of course, both of those processes are very slow and gradual. It doesn't happen overnight.
I do think something is going to happen to the housing market, maybe something bad, maybe something good, I don't know what. Currently Housing prices have been driven up artificially by corporations driving up private real estate. They can only remain artificially high for so long.
sooyoungisbaeee@reddit
that's late stage capitalism baby! we need major government reform to get corporations and price gouging under control
Marjorine22@reddit
A housing market crash will not do what you think, or hope, it will.
It will absolutely decimate the middle class and upper middle class, while the 1% watch the carnage, scoop up cheap homes from the crash, and sell them back to the same class of folks who lost them for a massive profit.
The lower class will never, ever buy these cheaper homes, because the prices will still be out of reach, and even more so, because it will be 2009 all over again, and everyone will be fearing for their jobs.
What you want is inflation to settle around 2% and wages to be rising slightly more. It's the only way out of this situation in terms of high prices. It is a slow process to drag an economy out of this.
On the bright side? I feel like nature is starting to correct itself. Fast food places are starting to realize their endless price hikes are a problem, and they fucked up. Retail spending dropped last month, which means Walmart and Kroger and Target are going to be fighting for less of the pie, which means consumers win at the checkout with more sales and aggressive pricing.
Hang in there.
BigPapaJava@reddit
They will come down to an extent on some things because of supply and demand, but they’re never going back to pre-2020 levels.
A lot of companies reported record short term profits because they simply raised their prices and pointed to “supply chain issues” or “inflation.”
The thing is… customers have started to adjust and now those businesses are losing business, so you’re seeing some price cuts. McDonald’s, Wal-Mart, etc. are looking to put some cheaper stuff out there as the higher prices have started to bite them.
fixed_grin@reddit
The problem with housing is that there is a shortage of it where people want to live.
The reason there is a shortage is because we do land use very locally, where the costs (construction hassle, parking, traffic) are higher, and a few buildings more or less won't really affect rents. As such, apartments are more or less illegal to build on most residential land in cities.
Land in cities is very desirable, which makes it expensive. If the only thing you can do with it is build one house, it will be an expensive house because of the land. Split into 10 or 20 or 100 apartments, the land cost becomes a lot less important.
The reason this is happening now is that we're running out of places to put suburbia in commuting range of jobs. After WW2, everybody got cars and we built a freeway network, which moved a lot of farmland from "you don't want to live there, it's too far" into 20 or 30 minute commute. That happened all at once, so the glut of land made it cheap. But we built on all of it, so now it's not cheap.
Zorro_Returns@reddit
I don't expect food prices to come down, and i do expect wages to go up, which will mean that people will have more money to spend, so why not raise prices?
Housing is a local market, and since nobody every says where they are, nobody can comment. In my area, they're going to come down, because they got too high. Real estate fluctuates, but the general long term trend is upward. I would pay close attention to the recent market before investing in real estate anywhere.
Here's the deal that I figured out on my own when I was a kid: The world is only so big. The supply of natural resources is declining. The population is increasing. Pretty simple to predict what happens to resource-dependent prices. Other things, like computer memory will go down. Those "today's dollar" calculators are really rough estimates. Not all prices go up or down in parallel.
DerekL1963@reddit
Unless your area is considerably different from the rest of the country... No, they're not coming down anytime soon. Demand far outstrips supply, and we (as a nation) aren't really doing much to correct that.
Responsible-Fun4303@reddit
I doubt it. All we can hope for is for prices to stop going up so quickly. I see it how grandparents or even parents like to say “when I was your age milk was a nickel and a loaf of bread was a penny”. Inflation hit to make milk and bread the price it is now and hasn’t ever gone back to that price.
JadeDansk@reddit
Hopefully not. Things will get more expensive, but (relatively minor) inflation is inevitable in a healthy market economy. The important bit is how expensive things are relative to how much people make, and for the median American that has been decreasing in the last few years. Compared to many peer countries, the US recovered from the pandemic (economically speaking) much better.
gugudan@reddit
Walmart, Target, Amazon, and a few other retailers say they're slashing prices (aka admitting to price gouging)
conrangulationatory@reddit
So long as out country embraces rampant capitalism us mid class working stiffs will take it in the ass and keep giving all our money to billionaires. Fun.
talk_to_the_sea@reddit
I’m honesty surprised they’re as low as they are given the war in Ukraine and Venezuela’s lunatic government. Luckily the US is current producing more oil than any country ever.
WillDupage@reddit
No. We experienced rapid price increases in the late 1970s-mid 1980s and prices never really came down.
Example: base price 1979 Ford LTD was$4510. In 1984, the base price for the same car (then called the LTD Crown Victoria) had risen to $11038.
obscuresignal@reddit
Well, Accord to Fred Harrison (economist who predicted the 2008 housing market crash a decade in advance) we're due for another housing crash in 2026.
ilovesaintpaul@reddit
Not gonna happen. We're not overbuilt right now. There's still massive demand for housing stock and it's not a bubble. !remindme1year
Darkfire757@reddit
Exactly. House prices may stabilize a bit, but they’re not going to the gutters anytime soon as much as so many redditors want to believe
-dag-@reddit
RemindMe! 1 year six months
TechnologyDragon6973@reddit
Doubt it. The system is broken and government meddling in the economy (which people mistakenly believe is capitalism) only worsens it.
WashuOtaku@reddit
Sadly, prices will only continue to rise.
Not likely. The last housing crash was because a lot of people that should not received a mortgage did. Since then the banks have been more strict who gets a loan and that they can pay it back; a result is that we are not in the same scenario and something different will need to happen for the bubble to burst.
Flashy_Cartoonist767@reddit
Canadians are in the same boat my American brothers and sisters! Screw the rest of the world at this point we need our governments to put North America first! There is zero reason to buy anything anywhere else 🇺🇸🇨🇦 have every resource on this planet between us. We need manufacturing back in full swing and investment solidly in our communities not some third world crap whole that some warlord will steal and we suffer.
The next elections for us matter deeply.
God Bless North America!
🇺🇸🤝🇨🇦 together we always win! History shows it and proves it.
Evil_Weevill@reddit
Almost certainly not. The best we can hope for is that the rate of inflation slows down significantly and that wages start rising a little faster.
Hopefully. We're currently coming out of another mini-recession so shit is bad right now and employers still kinda tightening their belts. But that will hopefully relax in the nearish future. Depends on a lot of factors though, make of which are entirely outside of our control.
Probably not. I work for a major US bank. And while I don't work on mortgage, I know a lot of folks who do. The general consensus is that for the foreseeable future there is no crash coming. Demand still currently outpacing supply in most areas so it's still a seller's market. The conditions that led to the '08 crash were entirely different. We're unlikely to see that again. Once again all we can really hope for is that the dynamics will eventually shift back to a buyer's market. So we won't have a crash but hopefully we'll have more affordable housing some time in the next decade.
While no one can predict the future with certainty, I can tell you this stuff comes in cycles. We're on a downswing right now that started with the tail end of the pandemic. Odds are it'll eventually start to swing back again but it will probably take time and will probably not be as dramatic a shift as we had in the early 2010s.
Electronic_Dance_640@reddit
Wages are already outpacing inflation and have been. It’s also a trade off, we coulda had much higher unemployment but is that any better? I’d rather have higher prices than be unemployed. Also we had a pandemic where millions of people died and global markets and supply chains were completely transformed overnight which everyone seems to forget- things aren’t gonna magically get better right away. Also America is doing great compared to most other countries. It might not be perfect but relatively speaking we’re doing about as good as one could.
nanitatianaisobel@reddit
Probably not. Inflation is usually a one way trip, and not just in the US.
Firm_Bit@reddit
Hopefully not.
Yes_2_Anal@reddit
they won't come back down. they will just not raise as quickly, and hopefully wages catch up
406_realist@reddit
Wages have increased, in some places more than others and often not fast enough but it’s happening. The answer to your question is yes, it can take awhile
Housing will eventually crash. People like to list reasons why it won’t but note that before every economic downturn in history people thought the same thing. The people who lost were “immune” a few months before.
People warned about all this during the global hyperbolic Covid mitigation and were called conspiracy theorists. Those “consequence free” shutdowns did in fact have consequences. Who knew
Ct-5736-Bladez@reddit
Not without some serious work
jrhawk42@reddit
I think we'll see a bit of relaxation on some greedflation, but a lot of things that continue to sell well are going to continue to have high prices.
Fappy_as_a_Clam@reddit
No.
Houses, maybe some if it crashes but maybe back to 3 years ago, not 20.
Groceries, nope. Those are the new prices.