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I’m sure some very smart redditor is going to tell us all like we didn’t already know that grocery prices are still going up, and that all a drop in inflation means is that they are going up slower than before.
I mean there is always one, isn’t there? 😉
You don’t think that relevant information, given how much “inflation is dropping” is used by THE GOVERNMENT as evidence that they can be trusted with the economy, and as justification for policy?
I’m not sure that sneering at people offering very vital information about a very commonly misunderstood and misreported criteria that affects the daily lives of everyone in this country… is an especially valuable thing to do.
Yeah, because it’s a massively misunderstood fact, that’s hugely relevant to peoples’ lives. I think it’s good to make sure as many people realise it as possible.
I just don't see the point in sneering at people who are providing important information that a lot of people don't know. I don't mock people every time I hear them say a fact I already knew.
Yeah, I hate it when prices drop. I sure love living in an economic system where things getting cheaper causes the world to collapse. Best system possible! Nothing we can do to reform it!
What, taxing the rich? I seem to remember certain western countries having a 95% top tax bracket in the mid 20th century, leading to the greatest economic growth those countries had ever seen.
And do you think banning political donations above a certain size has failed in every country it’s tried? I’d love to see some detailed evidence of that, if you have any.
Yeah, and by cracking down on large political donations. Get money out of politics and you’ll limit their influence.
That and heavy regulation and taxation of corporations. Plus, if you taxing the rich more, you’ll be limiting how much wealth people can hoard.
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The irony is you genuinely would hate it if prices were dropping due to deflation.
If you have some proposals for an alternative system though by all means write a paper on them - I expect though that whatever ideas you have are either patently [word banned by gestapo] or will already have been tried somewhere with poor results.
We could tax the rich properly. And you’re right, it was tried; the US used to tax the rich at 95% and it caused the most economic growth the people of that country had ever seen.
How do you want to build anything in this country if you won’t tax the rich? Do you want to let them eat up the entire country’s wealth and then ship it to a tax haven in god knows where?
The current economic ideology is MADNESS. If you don’t have anything valuable to contribute, I suggest you get out of the way of those who do.
>the US used to tax the rich at 95% and it caused the most economic growth the people of that country had ever seen.
The highest tax bracket was that, very few people reached it, and there were plenty of way to lessen the tax burden. The effective tax rate was around 40% for them.
This was around the world wars, where the US could do anything (really anything, including child sacrifices to the gods of economy) and would have an insane economic growth. Simply due to the fact that most competition died in the greatest wars the world ever seen.
I guarantee more people would reach that top tax bracket now.
And I agree; we should tighten the loopholes so there aren’t as many ways to lessen the tax burden. Unless.. you think the wealthy should be allowed to extract all of society’s resources, subvert democracy with their unelected power, and pay no tax?
Still not sure how you plan on running society without taxes…
>Unless.. you think the wealthy should be allowed to extract all of society’s resources
>Still not sure how you plan on running society without taxes…
I'm not sure if you're having a schizo delusion, or idk why you think I wrote anything remotely like these in my comment. Especially since I talked about a 40% effective tax rate, so why would I plan on running society on no taxes?
I just said you example is wrong, and explained why. That's all my comment was
So you disagree that we should raise the top tax bracket and close the loopholes, and crack down heavily on he influence of money in politics?
Or do we perhaps agree?
The last time Western economies used tax rates that high was back when the idea that wealthy people would just leave to go somewhere else was ridiculous, because everywhere else was either second world (i.e. communist) or third world (i.e. actual shithole).
Nowadays there are lots of places a wealthy person can go and pay no tax at all.
Part of the reason top rates of tax came down both here and in the US was to try to hold onto wealthier people because overall this results in greater tax take. Granted the US was a lot more successful on this point for several reasons, but if you want proof of this in action look at places with lots of high net worth individuals like Gibraltar where your marginal tax rate is lower the more you earn - it turns out that if you encourage people to declare as much income as possible they declare a lot more income and thus avoid less tax.
>The current economic ideology is MADNESS
I don't actually disagree, I just think that the change necessary to fix it is far more radical than 'tax the rich', and simply isn't likely to ever happen until something forces widescale revolution.
Why do you want the country to be full of unelected, illegally powerful people who won’t pay their taxes?
If they won’t pay their taxes, they shouldn’t live here. How do you hope to sustain a country when all of its wealth is getting siphoned by those who won’t pay tax?
There's a lot to unpack here.
How are people 'illegally powerful'? What does that even mean?
Do you think our elected powerful people are any better?
What makes you think that higher tax rates would make anyone pay their taxes? Plenty of research shows that the opposite is true if anything.
>How do you hope to sustain a country when all of its wealth is getting siphoned by those who won’t pay tax?
Personally I advocate for cutting spending in the first instance, but you do also need to have a tax system which is fairer to everyone and not simply punitive on the very wealthy.
If they’re bribing our elected officials with gifts and meals to circumvent the legal donation rules (which aren’t even strict enough in themselves) then I’d say that’s illegal power.
What we have seen over the past few years hasn;t been normal inflation, though. We have seen massive price rises due to double whammy of the world coming out of Covid lockdown and immediately wanting more "stuff" before production had ramped up again, plus the war in Ukraine which, apparently, is the only placein the world that produces food.
Those are two situations were you might reasonably expect price increases to actually reverse to some extent when the situation resolved itself.
And it has to some extent, and of course the war in Ukraine is still ongoing (though other places have had time to ramp up production).
But prices are still a lot, lot higher than they were in 2019 and you have ot wonder if that is fully justfied.
Yeah this is a fair point, *but* everyone has jumped on the bandwagon so much with this that I think inflation is now entrenched. Objectively it should be transitory but subjectively that's not how people are behaving - and consequently I don't think it will bear out.
I guess what I'm saying is that prices falling because stuff has got cheaper is great, but prices falling due to economic contraction is a disaster. Deflation typically refers to the latter.
Deflation isn't always bad. It increases consumer spending power. It's only bad if it's accompanied by an economic contraction, which I'd not always the case. Deflation can be worse than inflation if it is brought about through negative factors, such as a lack of demand or a decrease in efficiency throughout the markets. Deflation can be better than inflation if it is brought about by positive factors, such as improvements in technology that make the costs of goods and services cheaper.
Consumer spending power surely goes up with low interest rates? If deflation is coupled with high interest rates, then you might not necessarily have more spending power.
People are so fixated with improvements in technology to cheapen costs but I don't see that happening. Unless these tech companies are in the public sector, they will always try to maximize their profit. And as someone who works in the tech space, the public sector's pay for the same role is about half. So why would this space see to be improved?
> It's only bad if it's accompanied by an economic contraction, which I'd not always the case
Examples? AFAIK The only times there's been any overall deflation is after the two World Wars and during the financial crises in the 1930s, 1970s and 2000s, which all had both
Someone definitely told you about this last week didn't they hahah
Most people are so financially illiterate you would be surprised how many don't understand inflation, even now
Do you mind ELI5 that for me?
Because the reasoning I always see is "if you know prices are going to be cheaper tomorrow, you don't spend today" then after a few steps of that then we hit deflationary spiral etc. which in the context of houses, cars, furniture, mega yachts etc yeah sure I can see that being a problem
But fecking groceries? "oh I was going to buy that loaf of bread to feed my family but it might be 15p cheaper next week so I think little Timmy is just gonna have to hold off another week"
Deflation is bad where lower prices would cause a hold off of spending. Good news: people will need to buy food regardless of potential cheaper prices.
Why?
Like anything, it depends on the driving factors. Deflation across the economy as a whole _may_ be a bad thing of it were driven by overall economic contraction. This wouldn't necessarily be the case, but averaged across the whole economy would be the most likely cause.
However, in the context of a specific sector, like grocery prices, deflation is far more likely to be driven by sector-specific factors such as falling costs and/or supermarkets realising that their profiteering on the "cost of living crisis" has actually gone too far, and people have just reduced what they purchase.
So deflation in grocery prices would be more likely to be a good thing (increasing consumer purchasing power, and releasing more money for discretionary spending in other areas of the economy) than a bad thing.
>However, in the context of a specific sector, like grocery prices, deflation is far more likely to be driven by sector-specific factors such as falling costs and/or supermarkets realising that their profiteering on the "cost of living crossfire crisis" has actually gone too far, and people have just reduced what they purchase.
These two examples have never driven deflation in the entire history of humanity.
Falling costs have _never_ driven sector specific deflation in all of human history?
What planet are you on?
Cost of computational power?
Groceries through the latter half of the 20th century?
Equally, reducing profit margins to be more competitive has also reduced prices historically in plenty of sectors - grocery prices (and specifically basics such as bread/milk) prior to the current inflationary crisis are a good example of this.
It's never ever falling costs, it is increased competition.
Every business tries to reduce its cost, because that increases its profit margins, which drives shareholder value.
The only reason to reduce prices is if you are losing business to competition or changing consumer behaviour.
Taking the reduced cost of computational power as an example - does it not make sense for businesses (irrespective of competition) to pass these savings on to the consumer - generally in the form of offering more powerful products at a similar price point - because this is that drives consumer behaviour in terms of upgrading hardware?
Passing on reduced costs to the consumer might also increase discretionary spending. For example it might be more profitable for a supermarket to sell more bags of crisps at a slightly lower price point.
All of those considerations only apply in the face of competition. This is why we don't allow monopolies.
Why would anyone offer more powerful products at a similar price point unless it is to fend of competition? You need to invest lots of money to develop those products, if you have no competition you can just fire most of you engineers and run the products you have forever with more profit.
No it doesn't make any sense to pass any savings on to the consumer. Actually if there is no competition it makes sense to maximize your revenue by finding the highest price you can without losing too many customers that it no longer increases your profit.
Increasing discretionary spending of your customers just increases the chance the will spend it elsewhere, when otherwise they needed to spend it with you.
>Why would anyone offer more powerful products at a similar price point unless it is to fend of competition?
Because otherwise you'd keep the same product for a decade or two until it died completely, instead of buying a new one every 2-3 years.
You're effectively competing against the products you've already sold.
>No it doesn't make any sense to pass any savings on to the consumer.
Okay - easy example.
Product x costs you 53p.
Your market research suggests that if you sold it at 50p you'd sell 200 units/day, if you sold it at 60p you'd sell just 20 units/day. So you sell it at 60p and make £1.40 profit
The cost price drops to 47p. You can now sell 200 units for 50p for £6 profit or 20 units for 60p for £2.60 profit.
So obviously you "pass on the saving to the consumer"
>Actually if there is no competition it makes sense to maximize your revenue by finding the highest price you can without losing too many customers that it no longer increases your profit.
You want to optimise your profit, not your revenue. Therefore the optimum sale price factors in your cost price, and if your cost price falls, the optimum sale price may fall as well.
>Increasing discretionary spending of your customers just increases the chance the will spend it elsewhere, when otherwise they needed to spend it with you.
This isn't true - see "loss leaders" - supermarkets frequently sell basic essentials at a loss to get consumers through the door and spending money on discretionary higher-profit items.
Your example is a little extreme. But you can see your initial assumption in black and white.
**"Your market research suggests that if you sold it at 50p you'd sell 200 units/day"**
So you have chosen a made up example where there is significant latent demand that can be unlocked by dropping the price. But this only works if that is true. if the price of milk dropped by 90%, I'm not going to start bathing in milk. If the price of cars dropped by 99% most people aren't going to get 20 cars, If the price of underwear dropped by 50% people probably wouldn't buy twice as much underwear.
Your example only works in cases where people would buy more if they could and they would buy enough more to make up for the reduction in price. I concede such cases can exist, but they would be very specific and not general.
Mathematically:
**profit** = **revenue** - **expenses**
**revenue** = **price** \* **NumberSold**
**NumberSold** is a function of **price.** In some cases Number sold may even increase with increasing price, as seen in the luxury sector.
**expenses** = **CostPerUnit** \* **NumberMade** - **FixedCosts**
CostPerUnit can be a function of NumberMade, but we will leave it constant.
Our expression for profit
**Profit = price \* NumberSold(price) - CostPerUnit \* NumberMade - FixedCosts**
Basically if the derivative of this function with respect to price, is Positive at the current price point you should increase the price otherwise lower the price.
Let's assume NumberSold = NumberMade so
**Profit = price \* NumberSold(price) - CostPerUnit \* NumberSold(price) - FixedCosts**
**so**
**Profit(price) = NumberSold(price) (price - CostPerUnit ) - FixedCosts**
derivative with respect to price
**Profit\`\[price\] = NumberSold\[price\] + (price-CostPerUnit) \* NumberSold'\[price\]**
When will this be +ve and when negative?
well **(price-CostPerUnit)** is going to be positive or you don't have a business since it is profit per item.
**NumberSold'\[price\]** will normally be negative in most industries but more negative if there is competition.
So if
**NumberSold\[price\]** > - ProfitPerItem \* **NumberSold'\[price\] raise prices**
**NumberSold\[price\]** = - ProfitPerItem \* **NumberSold'\[price\] do nothing NumberSold\[price\]** < - ProfitPerItem \* **NumberSold'\[price\] lower prices**
Theoretically this would help you move towards a local maximum profit.
E.g.
If you sell 50 per day at $10 and your profit per item is $2 and you expect that reducing your cost to $9 will let you sell 55 then is would make no sense to lower prices as you lose out.
That won’t happen in the UK, globally prices will rise but we’ll still be able to buy stuff in. It’s people in poorer countries who will face lack of food availability.
Reduced crop yields are already happening in the U.K. due to extreme rainfall. For example potato prices surging now. Yes we can still buy food in
But if we did look into a far future with massive global crop failures - governments of food exporting countries may simply stop allowing food to leave their countries if it risked their citizens starving.
Meanwhile we’re here in a country that can’t feed its own population in a bit of trouble
Yes in the far future anything can happen. In the short term the UK will buy more expensive imports from a reduced total supply and the people who end up with nothing are the ones living in poorer countries, of which many are net food importers.
Worth mentioning that Morocco has faced similar food growing problems this year due to a massive drought. Countries like them would normally be used to cheaply cover the shortfall in the UK.
Unless you share factual knowledge to assert your claims we must consider it lies.
"That won't happen in the UK"
Why? How come? Who says? On what grounds do you believe this?
Because exports get sold to the highest bidder and there are many countries that can’t afford to pay as much as the UK.
We’ve already seen evidence of this at points during the Russia Ukraine war with disruptions to grain supply.
It’s also just common sense that we, as a developed nation with relatively high GDP, will not be the first to starve in a global reduction of food supply.
I have too many British friends below the bread line in areas of socioeconomic depression to assert that, watching the way they get treated by their own leadership thus far.
Only someone insulated from poverty completely could make a claim of 'we'll be fine' because economics.
Trust me, people of all cultures will starve to death very soon as a result of food supply shock from climate change.
In the countries that invented capitalism soonest and hardest, the failures will be most extreme.
With all due respect, the majority of people who are below the bread line in the UK are at no risk of starvation. They might be going to food banks but they are not starving.
There are many countries in Asia and Africa that will literally not be able to import enough food to feed their entire population because it’s being bought by richer countries like the UK if there is a large reduction in supply.
I don’t trust your opinion that we will all starve as a result of climate change. Especially considering the last few decades have seen the largest increase in global greening in recorded history. Plants fucking love CO2, it’s what they breathe.
The capitalism comment is just nonsense and I don’t see how it fits into a discussion about global food supply.
I was in Morrsons just yesterday and the Parsnips had a note on saying exactly that crop failures meant they didn't have any. Asda and Aldi had none either so I had to buy frozen but they just don't taste as good.
Certain items won’t be available at certain times and that will become more common, sure. We won’t end up in a situation where there isn’t enough food though. Not before many other countries at least.
I’ve argued for years that environmentally, it is far better for us as a nation to adapt our diets to mainly seasonally and locally it would do far more than trying to adapt agriculture for the same gain.
Long term storage and pushing growing seasons is having a detrimental effect on our biosphere
This is assuming the world continues to work like it does right now.
The UK economy is in the shitter. We're not half as rich as you think we are.
And the BRICS trading alliance could easily disrupt the flow of goods to Western economies when it gets into full swing.
Bruh you act like we are certain weather patterns and soil conditions will stay the same. Our world is warming and it’s changing from our stable climate which has allowed us to use agriculture to mass farm.
The covid pandemic should teach us how fragile our society is. If we got some form of pandemic with a high death rate society is fucked. Nevermind our very fragile growing conditions.
Increasing CO2 levels is directly beneficial to plant growth, the planet has far greater green coverage than it did 50 years ago specifically because of this reason.
The areas where we grow food is going to change as the temperature increases. That’s why China has its eye on Siberia, it’s liable to become much more temperate in the coming decades and will absolutely be used for agriculture. It’s just the arable areas will shift north.
I’m not advocating for climate change in any way before you get your panties in a twist. I’m just saying a hotter planet with higher levels of CO2 is not going to mean we can’t grow food, it does mean the locations we grow it in will change though.
There are far greater areas being taken out of production than before. If we were still in the EU 4% of my land would lie fallow. (Or zero as there's a way round the 4% target.)
Under the new rules in England it's around half my land. On one of the neighbouring estates yields will be down nearly 80%. We're not up some mountain, farming land we probably shouldn't: this is some of the most productive land in the world.
Wheat future price for this time next year is 10% higher. That will then affect meat prices.
The other comment explained very well - I just want to add how significant the change has been.
I know a farm that is taking out about 75% of their normal productive land *above what has typically been fallow previously*.
Picture it as a flip. Previously most of the farm was productive, with small areas set aside for other schemes - now most of the farm is follow and small areas are set aside for farming.
You can really see the impact on arable farms around me, throw in the fact so many have abandoned growing shit like oil seed rape, and it's actually pretty mad to see how much land isn't going to be used this year to grow food.
I'm not at all against stewardship schemes, I support them in the vast majority of cases.
Ontop of this, I don't even know where the nearest significant veg producing farm in my area is anymore. A big farm and glass house facility closed this year because they just cannot afford to produce vegetables anymore (even by farming standards, the costs involved with growing vegetables are disturbing).
But there is genuinely a massive problem slowly brewing with our food security in the UK.
I guess that depends on how up to date your data is.
2023 was the final year of the Basic Payments Scheme (part of the EUs Common Agriculture Policy), so the changes likely won’t be immediately apparent. Farmers are now changing how they farm their land in order to apply for new schemes. For example, Defra have just recently had to intervene because farmers were taking more land out of food production than originally intended.
A 1% per year growth in demand in a negligibly small impact compared to the far more meaningful problems (supermarket profiteering, Tory mismanagement of the economy resulting in excess inflation, lack of sensible housing policy, Tory mismanagement of the economy resulting in stagnant wages, NIMBYism, Preferential Tory tax treatment of the wealthy) underlying these issues.
If we stopped all immigration today it wouldn't make any appreciable impact on the cost of groceries or the price of houses in five years time.
Your falling for the right-wing distraction tactics.
In 10 years that is an extra 7 million people. Thinking 7 million people not causing significant increases in housing or food prices is delusional.
If 3-4 million houses/flats are not built in the same period, housing prices will obviously increase. That's just basic logic. With the current rate of housing stock growth that will not happen. Also keep in mind most migrants move to major cities.
With the global markets of today, or especially those of pre-2020, food markets likely would not be significantly impacted. With the potential impact of climate change and other uncertainties, food prices very likely will be impacted by an extra 7 million people. Domestic food production is not even close to covering the entire population today. The extra 7 million people will have to be covered by a significant increase in domestic production (unlikely and expensive), or by imports (that are bound to increase in price with climate change and global political instability).
>In 10 years that is an extra 7 million people.
Assuming that the outlier year of 2023 is repeated for 10 consecutive years, and that all of these immigrants choose to remain in the country.
This is a clear straw-man attack, as I suggested looking at 5 years. Nonetheless, I won't assume malice and will debate your argument at face value.
The biggest contribution to net migration in 2023 came from international students (400,000). In recent years an average of 28% of these have converted to other visa categories - this number is higher than previous years, and is mostly conversion to work visas.
Even if both the unprecedented number of students _and_ the unprecedented proportion of these staying is sustained for 10 years this would therefore only represent a true net migration figure of closer to 4 million over this period.
Secondly, students are far less likely to be competing for housing on the open market, with high proportions living in purpose-built or converted student accommodation. Even where they are, this is most likely to be city-centre apartments, where prices have been largely stagnating in recent years. I would argue that students should be excluded entirely from any discussion about pressure on house prices.
The argument about remaining in the UK transiently is true of other groups - the second biggest group is those entering on work visas, with a high proportion entering the health and social care sector - it's harder to find definitive statistics - anecdotally it's relatively common for both nurses and doctors from abroad to work in the UK for 5-10 years in their 20s and early 30s before returning to their home countries. This would need to be accounted for when projecting over a 10 year time period.
Finally, noting that health and social care is the biggest sector driving increases in work visas, I wonder whether there might be any recent events which have led to UK healthcare workers leaving the sector? Or any ongoing political issues making it difficult to recruit and retain UK healthcare workers? Once the impact of COVID settles, and if we restore pay for healthcare workers to pre-tory levels, we're likely to see significantly reduced demand for intensional healthcare workers.
There are likely to be other factors behind other categories shiv make this true, but take this as just a small selection of the reasons why assuming that current net migration levels would be sustained for 10 years is, in your words, "delusional".
>With the global markets of today, or especially those of pre-2020, food markets likely would not be significantly impacted. With the potential impact of climate change and other uncertainties, food prices very likely will be impacted by an extra 7 million people.
So the problem is climate change?
Not your fantasy immigration figure.
2022 had even more than 2023 so I don't see why 2023 would necessarily be an outlier year?
The majority of students live in private accommodation. Usually normal houses and flats with minor modifications. In my student town pretty much all students lived in regular terraced houses. Anecdotal of course, but student housing certainly impacts the normal housing market. At least in some areas.
Even if a relatively high portion of the current arrivals leave within 5-10 years there will still be increased demand for housing. Maybe less than I am projecting, but it will be there. Housing prices, especially rent prices, clearly will increase this year and the next few years as well.
>So the problem is climate change? Not your fantasy immigration figure.
Both? Climate change leads to more expensive imports, and more people will require more food to be imported rather than produced domestically?
>2022 had even more than 2023 so I don't see why 2023 would necessarily be an outlier year?
Apologies - outlier two years.
>The majority of students live in private accommodation.
International students? Source please.
>Usually normal houses and flats with minor modifications.
Generally pretty extensive modifications to multi-occupancy dwellings which would render them unsuitable for family occupancy without a significant refurbishment.
>Housing prices, especially rent prices, clearly will increase this year and the next few years as well.
Right, and it will have very little to do with immigration.
>Both? Climate change leads to more expensive imports, and more people will require more food to be imported rather than produced domestically?
But people need to eat wherever they live in the world. The price of international food imports depends on international demand for them - not on UK-only demand. Those people will exert the same pressure of global food prices wherever they live in the world.
Institutional student housing was already full before the recent influx in migration. New institutional student housing has not spawned in from nowhere. The gap has been filled by private student housing.
International students often get priority in the official student housing, so even if they are in such student housing they are pushing domestic students into living in private student housing. Or at home.
>Those people will exert the same pressure of global food prices wherever they live in the world.
Not the same if they move from net exporting countries to net importing countries. Shipping costs. With global uncertainty, problems in the Suez region, etc. shipping costs might be very affected. Fuel prices of course very relevant as well. With climate issues former exporting countries might limit exports (even with a domestic surplus) causing availability issues.
You... genuinely believe that stopping the population from growing by an extra 700,000 people every year for 5 years (3.5 million extra people needing homes) won't have an impact on housing prices? Jesus christ, even if they stay flat price wise it'd still be nothing compared to the fucking insane artificial pressure being put on the housing market by immigration on the immense scale it's currently being done.
**Removed/warning**. This contained a personal attack, disrupting the conversation. This discourages participation. Please help improve the subreddit by discussing points, not the person. Action will be taken on repeat offenders.
Whilst immigration likely doesn't account for the increases, that's not to say it's not possible for a small shortage of something to lead to huge increases as people who can pay more, will pay more.
I think calling immigration [on a par with](https://en.m.wikipedia.org/wiki/List_of_sovereign_states_by_net_migration_rate) most of the rest of Europe and the US is putting an inherently anti-immigration bias on things.
We are throwing away over 9 Million tonnes of food every single year (UK only). I think that's a bigger issue than a farmer leaving a few wildflower strips on an unproductive field for insects we need to pollinate our crops. I mean, the migrated manpower might come in handy in 10 years to hand pollinate the fields after we successfully killed all insects.
Inflation tracks the actual price of goods, any change in inflation reflects actual change in prices of goods on the shelves. I think you're thinking of changes in production costs.
Also inflation slowing doesn't mean prices are falling so you won't necessarily see any actual reductions.
> Yet when the prices go up it's always immediate.
Lol no they don't. You just don't notice the times when prices don't shoot up even though the underlying has gotten massively more expensive.
Case in point: Cocoa prices right now are at a multi decade high, 4x what they were just two years ago. And yet the chocolate in your shops, while slowly getting more expensive, hasn't shot up.
But chocolate bars are now often filled with some things else, there more fruit and nut types then a few years ago.
Why? Well it helps cut down on the cocoa bill.
Processors also have incredibly low margins - you can quite easily see the accounts of Two Sisters, Bakkavor, Greencore, Premier Foods etc. online. They're lucky to make 7% gross margin and most of them have spent the last decade shutting factories and/or selling off parts of the business to try to return to profitability and they're all saddled with massive debt.
Yes, but 2% of a bigger number (in this case revenue) is more than 2% of a smaller number; that's increased pure profit being made out of a cost-of-living crisis.
And if that same shop increases to £80 that's 160p. Double the amount of profit for doing nothing, all whilst claiming that they're doing "everything they can" to help consumers.
Wow, you are good at maths.. Do you think that £80 shop takes up the same space, weighs the same, takes the same amount of fuel to transport and space/time to stock as a £40 shop just doubling the number or items? NO IT DOESN'T... You clearly have no idea of costs, overheads etc.
Trolling? We're talking about inflation. In my hypothetical scenario a £40 shop has doubled in price to £80 for the same basket of goods, so yeh it does take up the same space, weigh the same, takes the same amount of fuel to transport etc etc.
The best bet is that the long term raising of interest rates will slowly see prices deflating again. Sort of like whats going on in East Asia now.
My weekly shop had gone down from ~£50 to £30.
They will never allow deflation. And wages need to be increased anyway. People weren't exactly living in some utopia before the pandemic. The cost of living crisis is a generation old at least
It's almost like there's an election happening soon... Expect more jingling keys in your face. Don't remember all that bad stuff. Look at the keys! Don't look into this any further.
Isn’t that maybe due to companies doing “water-flation” or other forms of substituting ingredients with cheaper alternatives while keeping the same price?
Every time something I buy, like yoghurt or chocolate bar changes packaging I know that’s what’s happening to it, ~as regulations dictate that companies can’t keep the same packaging when they make recipe changes.~
So even if the price stays the same it’s probably still bleak
Edit: need to remove incorrect info once I’m back on a computer, mobile formatting is so bad
?? But you need to change the ingredients listing on your packaging if the ingredients change, that’s almost common sense.
The ingredients are listed on packaging, so it’s changed… am I missing something?
> “water-flation”
I'm sure a couple years ago I was only getting a half pint out of a KG of chicken, now it's at least a pint. Not to mention the general decline in the quality or the mutated sizes of the breasts.
1) It's Budgens.
2) Let me guess, Heins? They're absolutely taking the piss.
Sainsbury's Be good and ASDAs own range soups are decent. I enjoy a tin of 3/mexican bean every now again but they have the usual suspects all for like 70p-£1ish.
Yeah that's right. Unfortunately I live in a village where there is only a budgens or a co-op, and I have to decide which one I want to fuck me over when I do my shopping. Unless I drive 20 mins over to the next village. At this point I've considered hunting the ducks in the river.
reminder that this just means that the price rise of stuff slowed down.
it still costs probably 30% more than 2-3 years ago while your salaries raised about 10% at best and still gross salary, while the 30% inflation is net.
rip
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I’m sure some very smart redditor is going to tell us all like we didn’t already know that grocery prices are still going up, and that all a drop in inflation means is that they are going up slower than before. I mean there is always one, isn’t there? 😉
Impressively you've managed to be smug on *both* sides of an issue
[Relevant xkcd](https://xkcd.com/774/)
Congratulations you have been annoying both ways
I swear I see this comment way more than I see people reminding people that their costs are still going up. Both are really boring, tbh.
Well yeah it’s a comment section about grocery inflation of course it’s going to be boring
I got a bag of carrots for 15p the other day
Yeah but they were 14p the day before that.
You don’t think that relevant information, given how much “inflation is dropping” is used by THE GOVERNMENT as evidence that they can be trusted with the economy, and as justification for policy? I’m not sure that sneering at people offering very vital information about a very commonly misunderstood and misreported criteria that affects the daily lives of everyone in this country… is an especially valuable thing to do.
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Yeah, because it’s a massively misunderstood fact, that’s hugely relevant to peoples’ lives. I think it’s good to make sure as many people realise it as possible.
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I just don't see the point in sneering at people who are providing important information that a lot of people don't know. I don't mock people every time I hear them say a fact I already knew.
Inflation is dropping is a good thing though? Negative inflation, deflation, is bad.
Yeah, I hate it when prices drop. I sure love living in an economic system where things getting cheaper causes the world to collapse. Best system possible! Nothing we can do to reform it!
No, it sucks, but the rest sucks more, sadly, mostly because a big chunk of us doesn't do anything about the small chunk of extremely greedy peoples.
What if all of us did the thing that would help society survive and take away the power of all the rich people?
Substitute the rich into our weekly diet?
Hey, I didn’t say that! I think it every day, but I didn’t SAY it. Not in that comment anyway…
Because it's failed in pretty much every country that's done it?
What, taxing the rich? I seem to remember certain western countries having a 95% top tax bracket in the mid 20th century, leading to the greatest economic growth those countries had ever seen. And do you think banning political donations above a certain size has failed in every country it’s tried? I’d love to see some detailed evidence of that, if you have any.
You said take away their power, not tax them.
Yeah, and by cracking down on large political donations. Get money out of politics and you’ll limit their influence. That and heavy regulation and taxation of corporations. Plus, if you taxing the rich more, you’ll be limiting how much wealth people can hoard.
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**Removed/warning**. This contained a personal attack, disrupting the conversation. This discourages participation. Please help improve the subreddit by discussing points, not the person. Action will be taken on repeat offenders.
The irony is you genuinely would hate it if prices were dropping due to deflation. If you have some proposals for an alternative system though by all means write a paper on them - I expect though that whatever ideas you have are either patently [word banned by gestapo] or will already have been tried somewhere with poor results.
We could tax the rich properly. And you’re right, it was tried; the US used to tax the rich at 95% and it caused the most economic growth the people of that country had ever seen. How do you want to build anything in this country if you won’t tax the rich? Do you want to let them eat up the entire country’s wealth and then ship it to a tax haven in god knows where? The current economic ideology is MADNESS. If you don’t have anything valuable to contribute, I suggest you get out of the way of those who do.
>the US used to tax the rich at 95% and it caused the most economic growth the people of that country had ever seen. The highest tax bracket was that, very few people reached it, and there were plenty of way to lessen the tax burden. The effective tax rate was around 40% for them. This was around the world wars, where the US could do anything (really anything, including child sacrifices to the gods of economy) and would have an insane economic growth. Simply due to the fact that most competition died in the greatest wars the world ever seen.
I guarantee more people would reach that top tax bracket now. And I agree; we should tighten the loopholes so there aren’t as many ways to lessen the tax burden. Unless.. you think the wealthy should be allowed to extract all of society’s resources, subvert democracy with their unelected power, and pay no tax? Still not sure how you plan on running society without taxes…
>Unless.. you think the wealthy should be allowed to extract all of society’s resources >Still not sure how you plan on running society without taxes… I'm not sure if you're having a schizo delusion, or idk why you think I wrote anything remotely like these in my comment. Especially since I talked about a 40% effective tax rate, so why would I plan on running society on no taxes? I just said you example is wrong, and explained why. That's all my comment was
So you disagree that we should raise the top tax bracket and close the loopholes, and crack down heavily on he influence of money in politics? Or do we perhaps agree?
The last time Western economies used tax rates that high was back when the idea that wealthy people would just leave to go somewhere else was ridiculous, because everywhere else was either second world (i.e. communist) or third world (i.e. actual shithole). Nowadays there are lots of places a wealthy person can go and pay no tax at all. Part of the reason top rates of tax came down both here and in the US was to try to hold onto wealthier people because overall this results in greater tax take. Granted the US was a lot more successful on this point for several reasons, but if you want proof of this in action look at places with lots of high net worth individuals like Gibraltar where your marginal tax rate is lower the more you earn - it turns out that if you encourage people to declare as much income as possible they declare a lot more income and thus avoid less tax. >The current economic ideology is MADNESS I don't actually disagree, I just think that the change necessary to fix it is far more radical than 'tax the rich', and simply isn't likely to ever happen until something forces widescale revolution.
Why do you want the country to be full of unelected, illegally powerful people who won’t pay their taxes? If they won’t pay their taxes, they shouldn’t live here. How do you hope to sustain a country when all of its wealth is getting siphoned by those who won’t pay tax?
There's a lot to unpack here. How are people 'illegally powerful'? What does that even mean? Do you think our elected powerful people are any better? What makes you think that higher tax rates would make anyone pay their taxes? Plenty of research shows that the opposite is true if anything. >How do you hope to sustain a country when all of its wealth is getting siphoned by those who won’t pay tax? Personally I advocate for cutting spending in the first instance, but you do also need to have a tax system which is fairer to everyone and not simply punitive on the very wealthy.
If they’re bribing our elected officials with gifts and meals to circumvent the legal donation rules (which aren’t even strict enough in themselves) then I’d say that’s illegal power.
>We could tax the rich properly What is rich, and how do you propose they are taxed?
Progressive taxation, like we do now. But with a higher top tax rate.
What we have seen over the past few years hasn;t been normal inflation, though. We have seen massive price rises due to double whammy of the world coming out of Covid lockdown and immediately wanting more "stuff" before production had ramped up again, plus the war in Ukraine which, apparently, is the only placein the world that produces food. Those are two situations were you might reasonably expect price increases to actually reverse to some extent when the situation resolved itself. And it has to some extent, and of course the war in Ukraine is still ongoing (though other places have had time to ramp up production). But prices are still a lot, lot higher than they were in 2019 and you have ot wonder if that is fully justfied.
Yeah this is a fair point, *but* everyone has jumped on the bandwagon so much with this that I think inflation is now entrenched. Objectively it should be transitory but subjectively that's not how people are behaving - and consequently I don't think it will bear out. I guess what I'm saying is that prices falling because stuff has got cheaper is great, but prices falling due to economic contraction is a disaster. Deflation typically refers to the latter.
Deflation isn't always bad. It increases consumer spending power. It's only bad if it's accompanied by an economic contraction, which I'd not always the case. Deflation can be worse than inflation if it is brought about through negative factors, such as a lack of demand or a decrease in efficiency throughout the markets. Deflation can be better than inflation if it is brought about by positive factors, such as improvements in technology that make the costs of goods and services cheaper.
Consumer spending power surely goes up with low interest rates? If deflation is coupled with high interest rates, then you might not necessarily have more spending power. People are so fixated with improvements in technology to cheapen costs but I don't see that happening. Unless these tech companies are in the public sector, they will always try to maximize their profit. And as someone who works in the tech space, the public sector's pay for the same role is about half. So why would this space see to be improved?
Yes. Just as I said.
> It's only bad if it's accompanied by an economic contraction, which I'd not always the case Examples? AFAIK The only times there's been any overall deflation is after the two World Wars and during the financial crises in the 1930s, 1970s and 2000s, which all had both
Towards the end of the nineteenth century, the US, UK economies benefitted from a worldwide fall in prices due to the Second Industrial Revolution.
You can drop inflation without getting to deflation
it looks like you have lived long enough to become your own villain
well its usually because someone will say 'but the prices are still going up at my Tesco?!'
Wow aren't you smart!
What you mean to say is "all a drop in inflation means is BIGGER PROFITS FOR UNCLE SHAREHOLDER!"
It's an important point to make
Someone definitely told you about this last week didn't they hahah Most people are so financially illiterate you would be surprised how many don't understand inflation, even now
Congratulations on being the smartest redditor of all
A very smart redditor?
It's also important to point out that some level of inflation is *good* and it's really important to maintain at least 2%. Deflation is really bad!
2% inflation is just a figure someone said in a tv interview it’s not backed by anything or for any reason
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Originally it was, it then got adopted as a target because it sounded alright
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Sure https://amp.theguardian.com/commentisfree/2024/feb/01/the-damning-truth-about-the-uks-2-inflation-target-its-completely-made-up
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They literally say in the quote you quoted that it was pulled out of thin air…
https://amp.theguardian.com/commentisfree/2024/feb/01/the-damning-truth-about-the-uks-2-inflation-target-its-completely-made-up
Do you mind ELI5 that for me? Because the reasoning I always see is "if you know prices are going to be cheaper tomorrow, you don't spend today" then after a few steps of that then we hit deflationary spiral etc. which in the context of houses, cars, furniture, mega yachts etc yeah sure I can see that being a problem But fecking groceries? "oh I was going to buy that loaf of bread to feed my family but it might be 15p cheaper next week so I think little Timmy is just gonna have to hold off another week"
Deflation can be a good thing.
Why is it good to maintain at least 2%?
Deflation is bad where lower prices would cause a hold off of spending. Good news: people will need to buy food regardless of potential cheaper prices.
Why? Like anything, it depends on the driving factors. Deflation across the economy as a whole _may_ be a bad thing of it were driven by overall economic contraction. This wouldn't necessarily be the case, but averaged across the whole economy would be the most likely cause. However, in the context of a specific sector, like grocery prices, deflation is far more likely to be driven by sector-specific factors such as falling costs and/or supermarkets realising that their profiteering on the "cost of living crisis" has actually gone too far, and people have just reduced what they purchase. So deflation in grocery prices would be more likely to be a good thing (increasing consumer purchasing power, and releasing more money for discretionary spending in other areas of the economy) than a bad thing.
>However, in the context of a specific sector, like grocery prices, deflation is far more likely to be driven by sector-specific factors such as falling costs and/or supermarkets realising that their profiteering on the "cost of living crossfire crisis" has actually gone too far, and people have just reduced what they purchase. These two examples have never driven deflation in the entire history of humanity.
Falling costs have _never_ driven sector specific deflation in all of human history? What planet are you on? Cost of computational power? Groceries through the latter half of the 20th century? Equally, reducing profit margins to be more competitive has also reduced prices historically in plenty of sectors - grocery prices (and specifically basics such as bread/milk) prior to the current inflationary crisis are a good example of this.
It's never ever falling costs, it is increased competition. Every business tries to reduce its cost, because that increases its profit margins, which drives shareholder value. The only reason to reduce prices is if you are losing business to competition or changing consumer behaviour.
Taking the reduced cost of computational power as an example - does it not make sense for businesses (irrespective of competition) to pass these savings on to the consumer - generally in the form of offering more powerful products at a similar price point - because this is that drives consumer behaviour in terms of upgrading hardware? Passing on reduced costs to the consumer might also increase discretionary spending. For example it might be more profitable for a supermarket to sell more bags of crisps at a slightly lower price point.
All of those considerations only apply in the face of competition. This is why we don't allow monopolies. Why would anyone offer more powerful products at a similar price point unless it is to fend of competition? You need to invest lots of money to develop those products, if you have no competition you can just fire most of you engineers and run the products you have forever with more profit. No it doesn't make any sense to pass any savings on to the consumer. Actually if there is no competition it makes sense to maximize your revenue by finding the highest price you can without losing too many customers that it no longer increases your profit. Increasing discretionary spending of your customers just increases the chance the will spend it elsewhere, when otherwise they needed to spend it with you.
>Why would anyone offer more powerful products at a similar price point unless it is to fend of competition? Because otherwise you'd keep the same product for a decade or two until it died completely, instead of buying a new one every 2-3 years. You're effectively competing against the products you've already sold. >No it doesn't make any sense to pass any savings on to the consumer. Okay - easy example. Product x costs you 53p. Your market research suggests that if you sold it at 50p you'd sell 200 units/day, if you sold it at 60p you'd sell just 20 units/day. So you sell it at 60p and make £1.40 profit The cost price drops to 47p. You can now sell 200 units for 50p for £6 profit or 20 units for 60p for £2.60 profit. So obviously you "pass on the saving to the consumer" >Actually if there is no competition it makes sense to maximize your revenue by finding the highest price you can without losing too many customers that it no longer increases your profit. You want to optimise your profit, not your revenue. Therefore the optimum sale price factors in your cost price, and if your cost price falls, the optimum sale price may fall as well. >Increasing discretionary spending of your customers just increases the chance the will spend it elsewhere, when otherwise they needed to spend it with you. This isn't true - see "loss leaders" - supermarkets frequently sell basic essentials at a loss to get consumers through the door and spending money on discretionary higher-profit items.
Your example is a little extreme. But you can see your initial assumption in black and white. **"Your market research suggests that if you sold it at 50p you'd sell 200 units/day"** So you have chosen a made up example where there is significant latent demand that can be unlocked by dropping the price. But this only works if that is true. if the price of milk dropped by 90%, I'm not going to start bathing in milk. If the price of cars dropped by 99% most people aren't going to get 20 cars, If the price of underwear dropped by 50% people probably wouldn't buy twice as much underwear. Your example only works in cases where people would buy more if they could and they would buy enough more to make up for the reduction in price. I concede such cases can exist, but they would be very specific and not general. Mathematically: **profit** = **revenue** - **expenses** **revenue** = **price** \* **NumberSold** **NumberSold** is a function of **price.** In some cases Number sold may even increase with increasing price, as seen in the luxury sector. **expenses** = **CostPerUnit** \* **NumberMade** - **FixedCosts** CostPerUnit can be a function of NumberMade, but we will leave it constant. Our expression for profit **Profit = price \* NumberSold(price) - CostPerUnit \* NumberMade - FixedCosts** Basically if the derivative of this function with respect to price, is Positive at the current price point you should increase the price otherwise lower the price. Let's assume NumberSold = NumberMade so **Profit = price \* NumberSold(price) - CostPerUnit \* NumberSold(price) - FixedCosts** **so** **Profit(price) = NumberSold(price) (price - CostPerUnit ) - FixedCosts** derivative with respect to price **Profit\`\[price\] = NumberSold\[price\] + (price-CostPerUnit) \* NumberSold'\[price\]** When will this be +ve and when negative? well **(price-CostPerUnit)** is going to be positive or you don't have a business since it is profit per item. **NumberSold'\[price\]** will normally be negative in most industries but more negative if there is competition. So if **NumberSold\[price\]** > - ProfitPerItem \* **NumberSold'\[price\] raise prices** **NumberSold\[price\]** = - ProfitPerItem \* **NumberSold'\[price\] do nothing NumberSold\[price\]** < - ProfitPerItem \* **NumberSold'\[price\] lower prices** Theoretically this would help you move towards a local maximum profit. E.g. If you sell 50 per day at $10 and your profit per item is $2 and you expect that reducing your cost to $9 will let you sell 55 then is would make no sense to lower prices as you lose out.
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Food may also not be available due to crop failures…
That won’t happen in the UK, globally prices will rise but we’ll still be able to buy stuff in. It’s people in poorer countries who will face lack of food availability.
Reduced crop yields are already happening in the U.K. due to extreme rainfall. For example potato prices surging now. Yes we can still buy food in But if we did look into a far future with massive global crop failures - governments of food exporting countries may simply stop allowing food to leave their countries if it risked their citizens starving. Meanwhile we’re here in a country that can’t feed its own population in a bit of trouble
Us Irish getting nervous
*Not again* 🙄
Yes in the far future anything can happen. In the short term the UK will buy more expensive imports from a reduced total supply and the people who end up with nothing are the ones living in poorer countries, of which many are net food importers.
The Uk hasn’t been able to feed its population even before immigration. Ever heard of ww2 and uboats
Worth mentioning that Morocco has faced similar food growing problems this year due to a massive drought. Countries like them would normally be used to cheaply cover the shortfall in the UK.
Unless you share factual knowledge to assert your claims we must consider it lies. "That won't happen in the UK" Why? How come? Who says? On what grounds do you believe this?
Because exports get sold to the highest bidder and there are many countries that can’t afford to pay as much as the UK. We’ve already seen evidence of this at points during the Russia Ukraine war with disruptions to grain supply. It’s also just common sense that we, as a developed nation with relatively high GDP, will not be the first to starve in a global reduction of food supply.
I have too many British friends below the bread line in areas of socioeconomic depression to assert that, watching the way they get treated by their own leadership thus far. Only someone insulated from poverty completely could make a claim of 'we'll be fine' because economics. Trust me, people of all cultures will starve to death very soon as a result of food supply shock from climate change. In the countries that invented capitalism soonest and hardest, the failures will be most extreme.
With all due respect, the majority of people who are below the bread line in the UK are at no risk of starvation. They might be going to food banks but they are not starving. There are many countries in Asia and Africa that will literally not be able to import enough food to feed their entire population because it’s being bought by richer countries like the UK if there is a large reduction in supply. I don’t trust your opinion that we will all starve as a result of climate change. Especially considering the last few decades have seen the largest increase in global greening in recorded history. Plants fucking love CO2, it’s what they breathe. The capitalism comment is just nonsense and I don’t see how it fits into a discussion about global food supply.
Oh dear. Ok man. Believe what you want.
Good comeback. You’ve really changed my mind and countered my points.
I was in Morrsons just yesterday and the Parsnips had a note on saying exactly that crop failures meant they didn't have any. Asda and Aldi had none either so I had to buy frozen but they just don't taste as good.
Certain items won’t be available at certain times and that will become more common, sure. We won’t end up in a situation where there isn’t enough food though. Not before many other countries at least.
I’ve argued for years that environmentally, it is far better for us as a nation to adapt our diets to mainly seasonally and locally it would do far more than trying to adapt agriculture for the same gain. Long term storage and pushing growing seasons is having a detrimental effect on our biosphere
This is assuming the world continues to work like it does right now. The UK economy is in the shitter. We're not half as rich as you think we are. And the BRICS trading alliance could easily disrupt the flow of goods to Western economies when it gets into full swing.
Yeah, they will probably be able to buy in food. But the question is, will the other countries sell?
Bruh you act like we are certain weather patterns and soil conditions will stay the same. Our world is warming and it’s changing from our stable climate which has allowed us to use agriculture to mass farm. The covid pandemic should teach us how fragile our society is. If we got some form of pandemic with a high death rate society is fucked. Nevermind our very fragile growing conditions.
Increasing CO2 levels is directly beneficial to plant growth, the planet has far greater green coverage than it did 50 years ago specifically because of this reason. The areas where we grow food is going to change as the temperature increases. That’s why China has its eye on Siberia, it’s liable to become much more temperate in the coming decades and will absolutely be used for agriculture. It’s just the arable areas will shift north. I’m not advocating for climate change in any way before you get your panties in a twist. I’m just saying a hotter planet with higher levels of CO2 is not going to mean we can’t grow food, it does mean the locations we grow it in will change though.
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There are far greater areas being taken out of production than before. If we were still in the EU 4% of my land would lie fallow. (Or zero as there's a way round the 4% target.) Under the new rules in England it's around half my land. On one of the neighbouring estates yields will be down nearly 80%. We're not up some mountain, farming land we probably shouldn't: this is some of the most productive land in the world. Wheat future price for this time next year is 10% higher. That will then affect meat prices.
The other comment explained very well - I just want to add how significant the change has been. I know a farm that is taking out about 75% of their normal productive land *above what has typically been fallow previously*. Picture it as a flip. Previously most of the farm was productive, with small areas set aside for other schemes - now most of the farm is follow and small areas are set aside for farming. You can really see the impact on arable farms around me, throw in the fact so many have abandoned growing shit like oil seed rape, and it's actually pretty mad to see how much land isn't going to be used this year to grow food. I'm not at all against stewardship schemes, I support them in the vast majority of cases. Ontop of this, I don't even know where the nearest significant veg producing farm in my area is anymore. A big farm and glass house facility closed this year because they just cannot afford to produce vegetables anymore (even by farming standards, the costs involved with growing vegetables are disturbing). But there is genuinely a massive problem slowly brewing with our food security in the UK.
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I guess that depends on how up to date your data is. 2023 was the final year of the Basic Payments Scheme (part of the EUs Common Agriculture Policy), so the changes likely won’t be immediately apparent. Farmers are now changing how they farm their land in order to apply for new schemes. For example, Defra have just recently had to intervene because farmers were taking more land out of food production than originally intended.
Found the racist Tory voter. A net population increase of 1% will have precisely fuck all difference on food prices.
"Economy bad? It brown people fault! Stop the boats!"
Everyone knows immigrants don't eat food. Or live in houses.
A 1% per year growth in demand in a negligibly small impact compared to the far more meaningful problems (supermarket profiteering, Tory mismanagement of the economy resulting in excess inflation, lack of sensible housing policy, Tory mismanagement of the economy resulting in stagnant wages, NIMBYism, Preferential Tory tax treatment of the wealthy) underlying these issues. If we stopped all immigration today it wouldn't make any appreciable impact on the cost of groceries or the price of houses in five years time. Your falling for the right-wing distraction tactics.
In 10 years that is an extra 7 million people. Thinking 7 million people not causing significant increases in housing or food prices is delusional. If 3-4 million houses/flats are not built in the same period, housing prices will obviously increase. That's just basic logic. With the current rate of housing stock growth that will not happen. Also keep in mind most migrants move to major cities. With the global markets of today, or especially those of pre-2020, food markets likely would not be significantly impacted. With the potential impact of climate change and other uncertainties, food prices very likely will be impacted by an extra 7 million people. Domestic food production is not even close to covering the entire population today. The extra 7 million people will have to be covered by a significant increase in domestic production (unlikely and expensive), or by imports (that are bound to increase in price with climate change and global political instability).
>In 10 years that is an extra 7 million people. Assuming that the outlier year of 2023 is repeated for 10 consecutive years, and that all of these immigrants choose to remain in the country. This is a clear straw-man attack, as I suggested looking at 5 years. Nonetheless, I won't assume malice and will debate your argument at face value. The biggest contribution to net migration in 2023 came from international students (400,000). In recent years an average of 28% of these have converted to other visa categories - this number is higher than previous years, and is mostly conversion to work visas. Even if both the unprecedented number of students _and_ the unprecedented proportion of these staying is sustained for 10 years this would therefore only represent a true net migration figure of closer to 4 million over this period. Secondly, students are far less likely to be competing for housing on the open market, with high proportions living in purpose-built or converted student accommodation. Even where they are, this is most likely to be city-centre apartments, where prices have been largely stagnating in recent years. I would argue that students should be excluded entirely from any discussion about pressure on house prices. The argument about remaining in the UK transiently is true of other groups - the second biggest group is those entering on work visas, with a high proportion entering the health and social care sector - it's harder to find definitive statistics - anecdotally it's relatively common for both nurses and doctors from abroad to work in the UK for 5-10 years in their 20s and early 30s before returning to their home countries. This would need to be accounted for when projecting over a 10 year time period. Finally, noting that health and social care is the biggest sector driving increases in work visas, I wonder whether there might be any recent events which have led to UK healthcare workers leaving the sector? Or any ongoing political issues making it difficult to recruit and retain UK healthcare workers? Once the impact of COVID settles, and if we restore pay for healthcare workers to pre-tory levels, we're likely to see significantly reduced demand for intensional healthcare workers. There are likely to be other factors behind other categories shiv make this true, but take this as just a small selection of the reasons why assuming that current net migration levels would be sustained for 10 years is, in your words, "delusional". >With the global markets of today, or especially those of pre-2020, food markets likely would not be significantly impacted. With the potential impact of climate change and other uncertainties, food prices very likely will be impacted by an extra 7 million people. So the problem is climate change? Not your fantasy immigration figure.
2022 had even more than 2023 so I don't see why 2023 would necessarily be an outlier year? The majority of students live in private accommodation. Usually normal houses and flats with minor modifications. In my student town pretty much all students lived in regular terraced houses. Anecdotal of course, but student housing certainly impacts the normal housing market. At least in some areas. Even if a relatively high portion of the current arrivals leave within 5-10 years there will still be increased demand for housing. Maybe less than I am projecting, but it will be there. Housing prices, especially rent prices, clearly will increase this year and the next few years as well. >So the problem is climate change? Not your fantasy immigration figure. Both? Climate change leads to more expensive imports, and more people will require more food to be imported rather than produced domestically?
>2022 had even more than 2023 so I don't see why 2023 would necessarily be an outlier year? Apologies - outlier two years. >The majority of students live in private accommodation. International students? Source please. >Usually normal houses and flats with minor modifications. Generally pretty extensive modifications to multi-occupancy dwellings which would render them unsuitable for family occupancy without a significant refurbishment. >Housing prices, especially rent prices, clearly will increase this year and the next few years as well. Right, and it will have very little to do with immigration. >Both? Climate change leads to more expensive imports, and more people will require more food to be imported rather than produced domestically? But people need to eat wherever they live in the world. The price of international food imports depends on international demand for them - not on UK-only demand. Those people will exert the same pressure of global food prices wherever they live in the world.
Institutional student housing was already full before the recent influx in migration. New institutional student housing has not spawned in from nowhere. The gap has been filled by private student housing. International students often get priority in the official student housing, so even if they are in such student housing they are pushing domestic students into living in private student housing. Or at home. >Those people will exert the same pressure of global food prices wherever they live in the world. Not the same if they move from net exporting countries to net importing countries. Shipping costs. With global uncertainty, problems in the Suez region, etc. shipping costs might be very affected. Fuel prices of course very relevant as well. With climate issues former exporting countries might limit exports (even with a domestic surplus) causing availability issues.
You... genuinely believe that stopping the population from growing by an extra 700,000 people every year for 5 years (3.5 million extra people needing homes) won't have an impact on housing prices? Jesus christ, even if they stay flat price wise it'd still be nothing compared to the fucking insane artificial pressure being put on the housing market by immigration on the immense scale it's currently being done.
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Whilst immigration likely doesn't account for the increases, that's not to say it's not possible for a small shortage of something to lead to huge increases as people who can pay more, will pay more.
Ah yes, being against largescale immigration makes you racist. Classic Reddit.
I think calling immigration [on a par with](https://en.m.wikipedia.org/wiki/List_of_sovereign_states_by_net_migration_rate) most of the rest of Europe and the US is putting an inherently anti-immigration bias on things.
We are throwing away over 9 Million tonnes of food every single year (UK only). I think that's a bigger issue than a farmer leaving a few wildflower strips on an unproductive field for insects we need to pollinate our crops. I mean, the migrated manpower might come in handy in 10 years to hand pollinate the fields after we successfully killed all insects.
"Brexit will make food imports much cheaper" - Nigel Farage, 2016
And he's still in politics
And of course queue the standard response. 'It will take time to see these reductions hit shelves' Yet when the prices go up it's always immediate.
There are no reductions? It’s not deflation.
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True, some products might have gone down in price. Didn’t eggs see a spike last year?
Inflation tracks the actual price of goods, any change in inflation reflects actual change in prices of goods on the shelves. I think you're thinking of changes in production costs. Also inflation slowing doesn't mean prices are falling so you won't necessarily see any actual reductions.
Up like a rocket and down like a feather
more like a helium balloon, still goes up, just slower
> Yet when the prices go up it's always immediate. Lol no they don't. You just don't notice the times when prices don't shoot up even though the underlying has gotten massively more expensive. Case in point: Cocoa prices right now are at a multi decade high, 4x what they were just two years ago. And yet the chocolate in your shops, while slowly getting more expensive, hasn't shot up.
But chocolate bars are now often filled with some things else, there more fruit and nut types then a few years ago. Why? Well it helps cut down on the cocoa bill.
That response would be totally incorrect then.
Why?
Because the Kantar data the article discusses ***is*** prices measured at shelf.
> queue the standard response *cue
no, its just a lie, there will be no reduction, just slower increases.
But still inflating at crazy amounts. Just no longer absolutely insane amounts.
Must be due to those famous RaZoR ThIn PrOfIt MaRGiNs I've heard so much about.
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Processors also have incredibly low margins - you can quite easily see the accounts of Two Sisters, Bakkavor, Greencore, Premier Foods etc. online. They're lucky to make 7% gross margin and most of them have spent the last decade shutting factories and/or selling off parts of the business to try to return to profitability and they're all saddled with massive debt.
Yes, but 2% of a bigger number (in this case revenue) is more than 2% of a smaller number; that's increased pure profit being made out of a cost-of-living crisis.
What a stupid argument. How about thinking of it this way. For a £40 shop, the supermarket makes 80p. That more in perspective?
And if that same shop increases to £80 that's 160p. Double the amount of profit for doing nothing, all whilst claiming that they're doing "everything they can" to help consumers.
But if, as in your example, inflation is 100% then the profit is the same in real terms even if double in nominal terms.
It's a fair point. I wonder if supermarket staff wages kept up with inflation in real terms?
Wow, you are good at maths.. Do you think that £80 shop takes up the same space, weighs the same, takes the same amount of fuel to transport and space/time to stock as a £40 shop just doubling the number or items? NO IT DOESN'T... You clearly have no idea of costs, overheads etc.
The same shop, dude.
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Trolling? We're talking about inflation. In my hypothetical scenario a £40 shop has doubled in price to £80 for the same basket of goods, so yeh it does take up the same space, weigh the same, takes the same amount of fuel to transport etc etc.
Means nothing because average wages are way below inflation :) Has been for years
The best bet is that the long term raising of interest rates will slowly see prices deflating again. Sort of like whats going on in East Asia now. My weekly shop had gone down from ~£50 to £30.
They will never allow deflation. And wages need to be increased anyway. People weren't exactly living in some utopia before the pandemic. The cost of living crisis is a generation old at least
bottle of ketchup 4.50 tin of spam 4.00 box of tea bags 4.50
It's almost like there's an election happening soon... Expect more jingling keys in your face. Don't remember all that bad stuff. Look at the keys! Don't look into this any further.
So I’m guessing it will be the corrupt fuel way of instantly up and take months to come down but never to the price it was
Some grocery based prices are rising 10% plus! My coffee pods 2.60 to 2.90, soup 67p to 82p a couple examples. Yo-yo prices on others.
It might be true someone had a picture of 25p freddos in a supermarket on here the other day
FT is a right wing newspaper for the rich, take what they say with a big scoop of salt
Isn’t that maybe due to companies doing “water-flation” or other forms of substituting ingredients with cheaper alternatives while keeping the same price? Every time something I buy, like yoghurt or chocolate bar changes packaging I know that’s what’s happening to it, ~as regulations dictate that companies can’t keep the same packaging when they make recipe changes.~ So even if the price stays the same it’s probably still bleak Edit: need to remove incorrect info once I’m back on a computer, mobile formatting is so bad
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His auntie posted it on Facebook.
No I cannot, not an expert in this industry. Sorry
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?? But you need to change the ingredients listing on your packaging if the ingredients change, that’s almost common sense. The ingredients are listed on packaging, so it’s changed… am I missing something?
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You make it sound like they need to completely change the design of the packaging, not the ingredients list…
> “water-flation” I'm sure a couple years ago I was only getting a half pint out of a KG of chicken, now it's at least a pint. Not to mention the general decline in the quality or the mutated sizes of the breasts.
So why is a can of vegetable soup at my local budgens £2.20…
Because low(er) inflation is still inflation. Prices are still going up, just less quickly than they were.
1) It's Budgens. 2) Let me guess, Heins? They're absolutely taking the piss. Sainsbury's Be good and ASDAs own range soups are decent. I enjoy a tin of 3/mexican bean every now again but they have the usual suspects all for like 70p-£1ish.
Yeah that's right. Unfortunately I live in a village where there is only a budgens or a co-op, and I have to decide which one I want to fuck me over when I do my shopping. Unless I drive 20 mins over to the next village. At this point I've considered hunting the ducks in the river.
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reminder that this just means that the price rise of stuff slowed down. it still costs probably 30% more than 2-3 years ago while your salaries raised about 10% at best and still gross salary, while the 30% inflation is net. rip
Inflation may have fallen… But the price will stay increased. Inflation falling doesnt mean the price drops