Home Household items Prices for this household item have plunged – 24/7 Wall St.

Prices for this household item have plunged – 24/7 Wall St.


Special report

The news headlines in September and October are all talking about the same thing: Inflation has not come down. Prices for everything that increased year over year in October, from gasoline (49.6%) to beef and veal (20.1%). Still, some prices have come down and the price of this item has plunged – elementary and secondary school food.

As the United States adjusts to the post-pandemic world, some economists have said inflation will ease. There are still enough jobs open, some argue, keeping the labor market flexible enough not to push up wages. A booming economy would increase production of the items most Americans need for everyday life. With a plentiful supply, inflation would last around a quarter, but no longer, some say. (House prices have also skyrocketed. These are the states where house prices have increased the most in the past 12 months.)

There were prominent economists who argued otherwise. Former Treasury Secretary Lawrence Summers, who is a noted economist, said the assumption that inflation could be tamed was wrong. Government spending to help create jobs after the 2020 recession and for other purposes proposed by the Biden administration would fund increased consumer spending. Disrupted supply chains would mean that many products would be in short supply. The formula for high inflation is already in place, Summers argued.

The September CPI backed the alarm bells of those who share the same point of view as Summers. What consumers pay for goods and services increased 5.4% on an unadjusted basis from September 2020, and October was even worse. The All-items index rose 6.2% from October of last year, a 31-year high. (The price of this household item is skyrocketing.)

Despite the fact that some articles grew double-digit year over year, some articles went against the grain. 24/7 Wall St. scanned the BLS Consumer Price Index summary for items that have fallen in price in the past year.

Remarkably, some prices have dropped by double digits. These included smartphones, phone equipment, and food sold at schools and employee sites. Specifically, the price of food in elementary and secondary schools fell 58.8% year over year. There are no ready-made explanations for any of them.

In fact, smartphone prices have plummeted even as one of the most expensive smartphones in history, the iPhone 13, recently hit the market. So why have smartphone prices gone down? These may be discounts offered on earlier versions of iPhone. These can be subsidies that wireless operators pay to customers to keep them or move them from other operators. Government data does not tell.

Foods sold at schools and employee sites may be easier to explain. Schools were closed and closed during the pandemic. Even when schools opened, parents kept children at home. And in a work-from-home environment, businesses are unlikely to return to regular employee meal schedules. However, as with smartphones, this is all speculation.

While most front-page reports on food prices reflect that they have skyrocketed this year, there are exceptions. The price of Frankfurters, lettuce and cheese has been falling year after year. This contrasts with uncooked steak, which increased 24.2% in October year over year.

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