No bargains in this post, just a vent about food prices. First, I heard on the news in recent weeks that food prices were expected to rise 5%, more than the 3-4% they rose last year. Only 5%? Puh-lease. They have gone up much more than that. A loaf of wheat bread is regulary priced at $3.50 or $3.75 now, that’s more than double what I used to pay.
And I don’t know if you saw it–but I saw it both on ABC news local and national, and it was on NPR. This idea of ‘sticky prices.’ The general gist of the news stories were that-“hey, oil prices came down and then gas prices came down. We were told that food prices were going up due to high gas costs, so why aren’t food prices coming down with gas prices?”
Apparently there’s something called sticky pricing. An event, such as high oil prices, causes prices on some items to increase. But even though there was a justifiable cause, when that problem is resolved, the prices don’t come back down. Because manufacturers and retailers know that we’re just accustomed to paying these prices, so they leave them there! This phenomenon apparently will happen with groceries and air travel prices, but we can expect clothing and other items to come back down.
How annoying is that? Here is the wiki definition of sticky economics.
Well, here’s to more couponing and hoping that the retailers get more competitive with their deals.
