Re:IMF: Largest driver of EU inflation is corporate profits
by Spivak on Monday June 26, 2023 @03:13PM
(#36484396)
Sure, but that assumes that people will do nothing in the long term that affects their spending behavior and will just eat the cost indefinitely.
If groceries tomorrow cost 10x I would not suddenly be spending 10x my current grocery bill. Luxury purchases like snacks, soda, premade sauces, candy, off-season produce, would be on the chopping block. Anything non-perishable would be bought in bulk during sales and wholesale clubs.
And for people who are already scraping by it would result in a 10x grocery bill which they can now not pay.
There's only so much money you can squeeze from a stone in the long run. Rising prices like this changes consumer behavior but can't make money appear out of nowhere. Since food is one of the easiest ways to belt-tighten rising prices across the board has the risk of reducing the wallet share food producers have.
If groceries tomorrow cost 10x I would not suddenly be spending 10x my current grocery bill. Luxury purchases like snacks, soda, premade sauces, candy, off-season produce, would be on the chopping block. Anything non-perishable would be bought in bulk during sales and wholesale clubs.
And for people who are already scraping by it would result in a 10x grocery bill which they can now not pay.
There's only so much money you can squeeze from a stone in the long run. Rising prices like this changes consumer behavior but can't make money appear out of nowhere. Since food is one of the easiest ways to belt-tighten rising prices across the board has the risk of reducing the wallet share food producers have.