Maybe it's the new old way of making known to the reader that an LLM was not used, like back in the day when printed maps had minor intentional mistakes (for entirely different reasons though) !
A lot of the inflation on food is increasingly feeling like businesses cashing in. For instance my old go to brand of breed increased by over 50% months ago.
They didn't have the pricing power/their customers didn't have the tolerance for rising prices/coordinated action and corporate consolidation means prices are going up and it doesn't matter what your choices are.
Circumstances materially changed over the last few years, and inflation is a great time for profit taking as we're seeing, which reinforces the inflation. In a competitive environment the excess profit-taking should start pulling back eventually, but in the meantime the prices are going to the moon.
I don't think there was a magical point in consolidation that let them increase the price of eggs ad hoc. Or a magic 'greed' button that they refused to hit before now. Why not just make it $30 an egg?
> They didn't have the pricing power/their customers didn't have the tolerance for rising prices/
Just for everyone's sanity, it's WAY easier to believe that there are underlying market conditions that should be addressed and not worry too much about retailers. They are just doing marginal pricing. If there is a shortage on eggs, it's better for everyone that they price eggs so they stay on the shelves than to price them as if nothing is happening and then people panic because they can never find them anymore.
The profits may be up, but the revenue is still down overall.
The linked study didn't really make that claim. All it really showed was that only a small portion of inflation was returned in the form of wages. It didn't really attempt to figure out the reasons for the profits.
I don't know why people get so hung up on this though: If you have less stuff to sell, and fewer employees to sell it, your profit margins are going to be higher! That doesn't mean though that you are maximizing your revenue potential. Which is probably why despite all of these reports of "record profits" you are not seeing exploding stock evaluations.
Also, it doesn't hurt that inflation is always going to be favorable to retailers. You buy inventory at the pre-inflation price and sell it at the post-inflation price. Even if you just price to keep up with inflation, you are going to report "record profits" every quarter just by nature of inflation.
>I don't think there was a magical point in consolidation that let them increase the price of eggs ad hoc. Or a magic 'greed' button that they refused to hit before now. Why not just make it $30 an egg?
I'm not sure this can be approached from a rational examination of economic premises alone. You raise good questions. However political economy also should be considered.
Let us imagine for a moment that this narrative is being advanced to deflect from government largess in the economy. Under this scenario court economists have an interest in protecting the regime, while the regime and academic institutions generally have a symbiotic relationship. If these incentives make sense, the narrative can be better understood in this political context.
Unfortunately this hypothesis suggests that there is very little we can say here without this discussion devolving into the regular flames we see on this topic.
This is exactly it. Companies will actually go quite into the red on particular products to avoid a price increase "before everyone else" if they can survive else wise.
There cannot be anyway Arizona Ice Tea is making the same profit today on their .99 cans that they were in 1992.
And at some point that has to break unless they become a charity subsidizing aluminum-clad tea.
When "the break" happens they almost always overshoot; it's easier to offer a 'discount' later if necessary.
Long story short: they reduce costs (thinner cans, no need for heavy marketing because fixed price is the marketing) and aren't greedy, playing the long game.
Free market economics means that if absurd profits are being had, then new people coming to the game will offer slightly cheaper prices.
A price were willing occur until surviving companies are making minimal amount of profits.
Related is if someone figures out how to produce the same amount for less effort/cost.
If someone is making absurd profits for long periods, then usually some major factor such as government regulations is preventing new players from entering the market.
> Free market economics means that if absurd profits are being had, then new people coming to the game will offer slightly cheaper prices.
Supermarkets are expensive but still not expensive enough for someone to bootstrap an operation to elbow themselves into the market as a new player and expect to still make profit.
> A price were willing occur until surviving companies are making minimal amount of profits.
> Related is if someone figures out how to produce the same amount for less effort/cost.
Existing supermarket chains have massive delivery networks and associated efficiency, already have
- the real estate and
- all the internals of a retail store and
- the associated warehousing set up,
- all the personnel who know their way around the store and where everything goes (which is a huge part of the efficiency of distributing the wares in the store),
- "brand" recognition of the store (Aldi, Tesco, Walmart, ...)
which means the new competitors would very likely have to massively loss-lead at a time when the already-established market participants are making more profit than before.
> If someone is making absurd profits for long periods, then usually some major factor such as government regulations is preventing new players from entering the market.
Selling foodstuffs especially is an area of business where a huge chunk of regulations are absolutely justified and it's not like all of the food singled out because of expired shelf life ("MHD"/"Mindesthaltbarkeitsdatum") is getting thrown into the garbage (at least here in Germany).
I currently work in a supermarket and have done so in a different chain before this one and from what I know most damaged or "expired" food is getting written off and then either set aside in the appropriate temperature store-room for the "Tafel" (food bank) OR if it's really unfit/unsafe for consumption (moldy, completely interrupted cold chain [1] or obvious signs of spoilage like bloated food packaging) it gets thrown into the garbage.
Raving about "free markets" from ones ivory tower is all well and good but the reality is that because of corporate consolidations and necessity-for-living many economic sectors are effectively locked down by (implicit) cartels, either because it's cost-prohibitive to even enter - let alone succeed in - that market or because the actual necessary infrastructure has been divied up between the current market participants (think USA and their local mono-/duopolies of ISPs).
[1]: For example when we find items which should be kept cool or frozen in other areas of the market having been taken and left there by customers who obviously don't care (like that one time I found fresh fish with its plastic bag bloated to bursting in a warm section of the market during summer time, thankfully the packaging wasn't damaged or it wouldn't have been pretty).
One hypothesis I have is that as food and labor costs have increased, people eat out less and generate more store traffic. Those shoppers are stuck with the decision to cook and their demand on a per store basis is more inelastic.
Mass inflation is a convenient excuse for profiteering. Similar shit happened in Germany with the DM => EUR switchover, yielding the nickname "Teuro" ("expensive euro").
The core problem is that Western countries have collectively decided to dial back anti-trust enforcement that could have stepped in.
Energy price in EU is at pre-war levels, as far as I know, for some months now. It definitely must be something else. I live in a country where everybody eats bread every day, and the price increase has been around ~80% over the span of a year. The price of flour has risen by around ~15-20% with all the "Ukraine is a major grain exporter" uncertainty since the beginning of the war. Corporate profits are unprecedented, so it cannot be anything else but pure greed.
I'm having trouble understanding how much of food shrinkflation is down to actual costs going up versus exploiting the current market dynamics to squeeze more profit.
I understand it's probably a mix of both, but it's hard to tell the relative proportion as a consumer.
I've switched to buying the bargain bin discounter stuff. It's such a transparent pretense to raise prices while raking in profits that I don't want to give it to them.
At least where I am this is the case. Milk and milk products are at record highs, with some products nearly double what they were at the beginning of last year. Yet the milk companies actually cut how much they pay producers. Prices for energy and fuel are around the same as the end of 2021.
As someone who doesn't live in the UK, the impression I get from headlines is that the UK is becoming poorer by the day, the NHS has collapsed, crime is exploding, poverty is rising, most people can't afford anything anymore, the Royal Mail is hanging by a thread, and the economy is in free fall.
Anecdotally, my buddy (31M) in London says he's having the time of his life. Making a lot of money at BP, parties every weekend, just moved into a nice flat with a partner. I suspect, just like in America, that if you're inside the "formal economy" (corporate job with real benefits and potential for career growth) your life is pretty great. If you're outside that (service worker, gig economy, small business owner, NEET) then things are pretty grim.
That's the rising income inequality working the way it does. Inequality is the reason many third world countries are as bad as they are. Now the US and the UK are seeing rising inequality and for sure you'll see they having more of this stupid problems happening.
Economy is not great but certainly not in free fall. Most people are ok. Crime is no worse than in other major European countries. There are no riots in London (looking at you, Paris...)
On the other hand, according to certain parts of the UK press those riots in France are a sign that their politics is far healthier than the awful state of politics here (looking at you, Guardian)...
On the contrary, those riots show that every important issue in France is hijacked by violent far left militants who don't want to debate but to bring "the system" down or just destroy as much property as they can get away with. That is not healthy. Riots on the pretext that the retirement age increases by 2 years to an age still below the EU average is not a sign of healthy politics.
London has experienced the worst drop in quality of life by far, other places are also being hit but they're kind of used to it by now and they can't really fall much further anymore.
I've lived in London for the past 6 years and I wouldn't say that at all. Food and energy has gone up (comparably to the rest of Europe), but there's a feeling that Sunak is more competent than the previous lot. Plus we're getting loads of tech investment.
I lived in London pretty much since I was born (2000), I moved away last year because of how bad it's gotten, and it has very little to do with food and energy. There is basically no sense of social cohesion left anymore, you cannot expect safety, you cannot leave a car parked outside and expect it not to be broken into. I've had a guy almost pull a knife on me because I accidentally came up behind him and he thought I was from an opposing gang. This sort of thing was a not-so-uncommon experience for my peers at school.
This is just so alien to me. I'm in a not-so-great area of North Islington, and never even _seen_ violent crime happening.
I can't walk down the street any more without saying hi to people, the chippy guy who goes on Sunday runs, the coffee shop owner who lets me know when they're trying a new roaster, the elderly women walking their dogs at lunchtime. It's almost like my old hometown.
I'm very Americanized owing to the amount of American content I've consumed, especially due to the internet. For example: I also say 'dude' and use American spellings for words.
I have a lot of friends in the UK, and my perception 15 years ago was that it was a country in decline. There was a general feeling of malaise, with not many hopeful for the future.
2008 was probably not the best time to ask that question - and it's probably not the best time to ask it now either. (Unless you want a negative, doom-laden answer, in which case you got lucky both times!)
It's hard to get a handle on any kind of objective reality. Headlines always catastrophise.
Anecdotally at least:
- Brexit is a pretty notable economic negative, purely in the sense that it's added a lot of drag to EU trade and made it harder for workers to access the UK market. Nobody likes loads of red tape. It's hard to separate this from the many other influences from COVID through to Ukraine.
- There has been a pretty clear spike in the cost of living, which has a direct impact on things like poverty. Notably the housing market was very disrupted by the policies of the previous prime minister; again, it's hard to separate this from anything else but anecdotally a very large number of people noticed that they suddenly had to find hundreds of pounds of extra money every month due to housing end energy costs.
- The NHS is not in a great state, no. Several years of underinvestment and the pandemic came home to roost, and combined with the pandemic and rather a lot burnout it is not sounding great from anyone who works there.
- The economy isn't in "free fall" but does have several things dragging at it – including supply-chain difficulties, inflation, worker shortages, and other challenges. It's hard out there.
- Most noticeable and in-your-face thing for someone like me—in the fortunate position of being on the breadline—is an obvious deterioration in services and availability. Lots of strikes in various industries, quality of everything suffering, difficulties getting basic goods sometimes. It can feel pretty oppressive, though of course nothing compared to how some people must be struggling to get by at all.
I live in London and am married with 2 kids, working in tech. Personally, I'm not seeing too much difference.
* Energy prices are higher, and this has had a knock-on effect, but I see it more on childcare (e.g. nursery) than food.
* There have been shortages of some foods - specifically there were shortages of tomatoes and peppers for a week or two a month or two ago, but not recently... and there are shortages of eggs, which I understand from my cousins, who are egg farmers, is primarily due to bird flu (most eggs in the UK are from British hens).
* Regarding NHS, we've not needed to use hospitals recently, but access to GPs has been same as usual.
* I've not seen an increase in crime.
* I hear that poverty is rising, but don't have direct experience.
* The Royal Mail is almost certainly dying, but I think it's been on its way out for years.
Like I say, this is just personal experience - I appreciate that I'm quite lucky at having an OK-paying job, so could well be insulated from problems that others face.
It seems that way because part of the problem is that grievance has become the most valuable currency.
Food here is, empirically, still unbelievably cheap. I can buy a 500g bag of spaghetti for 28p, lentil and beans are cheap, bread is relatively cheap, chicken is so cheap that you wonder how safe it is...still...but the problem is that in the UK, if anything doesn't benefit you immediately then people will complain.
RM...they had a monopoly, their workers are almost always threatening industrial action, like they aren't "hanging by a thread"...they have a licence to print money, workers just won't turn up to work because they feel aggrieved.
NHS...funding is through the roof, the biggest individual component of the budget with a deficit of 5% and tax % of GDP at all-time highs...workers on strike, "they get paid more in Australia" (true of almost every job in the UK because Australia also has significantly higher CoL).
Crime? Again, we have an underclass of people who commit all the crime, repeat offenders often walk free over and over, shoplifting isn't investigated, robberies aren't investigated...and people wonder why it is attractive to commit crime?
Poverty hasn't increased, unemployment has dropped like a stone over the past ten years, all this time we have people like you: the economy is in FREE FALL, poverty is going to rise soon...it hasn't happened, the issue we have is that people are constantly feeling aggrieved. This seems to be a disease of the West too, you see the same thing in the US where there are real economic issues but there is very little discussion of them...all it is just single-dimensional, "things have never been so bad" grievance-building.
But no, nothing has really changed. Life carries on unsurprisingly. The UK has issues, food prices aren't one (in fact, food prices are far too low still), problems that do exist remain unaddressed, problems that don't exist absorb all of the attention.
I’d say they’re overly dramatic headlines. For example, the nhs is under funded, as always, but still functioning with long wait time s for non emergency surgery/consultation. Poverty is rising as a consequence of the cost of living crisis. The Royal Mail has always been an overly priced service buts there’s loads more competition. Personally, I reckon we should just let the service die!
Saturday deliveries and 5 weekday deliveries seem unnecessary, but universal letter and small (CD-sized) parcel service seems worthwhile.
If the logistics work, delivering letters only if there's a first class letter to be delivered, if there's a standard letter that's been waiting more than 2-3 days, or if Royal Mail feel like it (e.g. delivering to this road for someone else's first class letter) might save a lot of money.
32, tech worker, just bought a house in a village in the south... Yes my vegetables are a bit more expensive week to week, maybe i need to go to another store to buy one or two specific things but generally life is fine.
Still getting pay rises, still getting bonuses. Generally life is more comfortable for me than its ever been.
Someone set fire to a bin last week, does that count as an increase in crime?
The reality is very difficult to assess, but there are some clear markers: NHS waiting times have increased, and there is an unprecedented series of strikes by NHS staff some of whom are badly underpaid and all of whom have been exhausted by the pandemic.
Crime is not necessarily exploding, but confidence in the police is rather low. A Metropolitan police officer was jailed for 71 counts of sexual assault earlier this year, having done quite a lot to raise the crime rate all by himself.
> Bread was up 20.8%, with pasta products and couscous up 25.3%
This is unjustified. Under no circumstances could this happen unless a) price gauging, or b) supply chain is drying up.
Edit for the ignorant:
> The UK is largely self-sufficient in production of grains, producing over 100% of domestic consumption of oats and barley and over 90% of wheat. Average yields over recent decades have been broadly stable but fluctuate from year to year as a result of better or worse weather. Increasingly unpredictable and extreme weather as a result of climate change is likely to exacerbate these fluctuations. Wheat yields in 2020 were the lowest since 1981 due to of unusually bad weather. However, preliminary data indicates they have since increased in 2021.
> In meat, milk, and eggs, the UK produces roughly equivalent volume to what it consumes. In 2020 it produced 61kg of meat, 227L of milk and 172 eggs per person per year. By value, the UK is a net importer of dairy and beef. This reflects UK consumer preferences for eating higher value products, while lower value products are exported.
> The UK produces a significant proportion of its other crop needs, including around 60% of sugar beet, 70% of potatoes and 80% of oilseeds. Apart from a recent pest-related reduction in oilseeds, these proportions have remained stable over the last ten years. Climate change represents a risk to production both in terms of making conditions unsuitable for some crops and allowing new pests to proliferate but it may also benefit new types of crops.
> The UK produces over 50% of vegetables consumed domestically, but only 16% of fruit. 93% of domestic consumption of fresh vegetables was fulfilled by domestic and European production, while fruit supply is more widely spread across the EU, Africa, the Americas, and the UK.
Well we saw extreme disruption in the supply of fertilizer and some extremely poor growing seasons in some bread basket reasons around the world simultaneously, if I recall correctly (which I might not be).
Are you aware that the UK is largely self-sufficient wrt grains?
> The UK is largely self-sufficient in production of grains, producing over 100% of domestic consumption of oats and barley and over 90% of wheat. Average yields over recent decades have been broadly stable but fluctuate from year to year as a result of better or worse weather. Increasingly unpredictable and extreme weather as a result of climate change is likely to exacerbate these fluctuations. Wheat yields in 2020 were the lowest since 1981 due to of unusually bad weather. However, preliminary data indicates they have since increased in 2021.
> The UK produces a significant proportion of its other crop needs, including around 60% of sugar beet, 70% of potatoes and 80% of oilseeds. Apart from a recent pest-related reduction in oilseeds, these proportions have remained stable over the last ten years. Climate change represents a risk to production both in terms of making conditions unsuitable for some crops and allowing new pests to proliferate but it may also benefit new types of crops.
> The UK produces over 50% of vegetables consumed domestically, but only 16% of fruit. 93% of domestic consumption of fresh vegetables was fulfilled by domestic and European production, while fruit supply is more widely spread across the EU, Africa, the Americas, and the UK.
That have considerable export logistics through Romania. Minus the resources that Russia stole over the territories it had control over during this stupid Putin war.
Is this at least partially Brexit related? For comparison, the US has seen food go up by around 10% over the same time period, which is pretty high but also far from 18%.
War has nothing to do with that, at least not war in a classical sense. Economic or total war that some countries are involved in can be considered as a major reason.
My understanding is the Russia and Ukraine both contribute meaningful portions of the global food supply. Wouldn't destabilizing these two countries affect food prices globally?
Yes, this is well known and has been tracked in the finance and economic press. Just as an example, both grain production and transport (due to disturbances in rails and shipping) were both effected directly and indirectly which had significant impacts in Africa.
Are any countries other than maybe Ukraine engaging in total war? I'm not sure even Russia's mobilized to a degree that the term's applicable (though, maybe, in their case—but anyone other than the two principles in the war? Definitely not)
And Ukraine's hesitance/inability to strike war-relevant civilian targets in Russia (say, bridges and factories) more than very-sporadically makes the term a bit iffy even for them. Hell, even Russia's been more restrained than what the term usually suggests, as far as the brutality of attacks, if only barely.
It basically means "complete mobilization of a state & society toward a war effort, coupled with a willingness to engage any target regarded as having any war relevance whatsoever, no matter where or what the target is". Hallmarks are mass conscription, rationing, large-scale conversion of civilian production capacity to making war materiel, and leveling cities on purpose (not just as a side-effect of fighting over them).
Naw. Stupid people are only happy until they face the consequences of their stupidity. I'll take being right and derive my happiness elsewhere because internet validation is a chump's game.
Every country in Europe is feeling the effects of the war in Ukraine but the UK seems to be dealing with it the worst. There's clearly an extra layer going on there.
How do you figure? From the numbers posted by others in these comments it seems UK inflation is pretty much mid-table compared with the rest of Europe: https://i.redd.it/8hbhiqhowjpa1.png
Fair enough, I was only thinking about inflation resulting from the war. You are right about the other things, and Brexit is undoubtedly a factor there.
Last year we spent two weeks in Iceland. I do remember, 10+ years ago, paying the same for 2 (two!) onions as you did for 1kg in Germany over there. Last year, we were not shocked at all, actually we paid less then we did in Germany, not much but still. Turned out Icelands grocery prices were roughly on par with France, and a tad lower than Germany at the time.
So, German groccery prices did a lot of catching up since at least a hear. Slow enough so that you don't realize unless you are living on tight budget. That being said, since salaries in Germany tend to be higher than in France, the average German consumer is still a bit better off (ignoring housing or rent, and using a broad brush here).
The war im Ukraine did caise all kinds of issues, as did Covid. All ghinhs considered so, the developed world did reasonably well so far so. If food prices increaseore so, governments will have to intervene, as lower income families will have a hard time between increased energy and food prices.
It feels Europe is becoming increasingly poor and unsafe, and the situation in the UK has worsened quite a bit since the start of Brexit.
Anecdotally, seems there's a lot of British and European expats here in the Valley and they don't seem too keen on returning. We've been getting a lot of international applicants (but work from home was supposed to mean Europeans could avoid moving to the "dangerous" US but work for American companies?).
Brexit was 6 years or so ago. Then we had 3 years of trying to reverse it, then Covid, then Ukraine and, to top that, a Govt that decides fracking for gas is unacceptable and then goes and imports fracked gas from the US.
Maybe best to sum things up as a run of bad luck compounded with gross incompetence?
Everything becomes less safe when inflation is on the rise. Every country has a different inflation formula (alongside the effects of "shadow inflation"), thus you can't compare 10% in country X with 18% in country Y. We're all in the same shit.
Can’t seem to find data to backup this observation, so leaning on anekdata instead - when traveling in EU, food prices seemed a lot lower than US. If this is true, an equivalent nominal increase would translate to a higher percent increase. For example, if the good costs $10 in US and $5 in UK, both see an increase of $1 (let’s say due to some shared factor like energy cost), then US would report 10% increase and UK 20%.
_Probably_, but German food inflation is running about 22%, and the UK is pretty comparable with most of Europe, so Brexit is probably a minor effect at best.
Nearly all inflation is tied to inflation in cost of energy. Food is especially related to energy cost, since the core cost of modern food creation is the cost of fertilizer and operating artificial growing environments (greenhouses, metered and pre-mixed feed waters). Energy is going up, so food is going up, this impacts Europe more than the US, because they operate in different energy markets. More generally, for almost all goods, the cost of transport went up, both because of the cost of energy, and because of challenges with logistics during the pandemic that have not fully subsided.
Energy costs are the primary driving factors for the cost of nearly all aspects of modern life.
This was predicted when Ukraine was invaded. Russia and Ukraine were the world's leading producers of the ingredients in fertilizer.
They are now no longer exporting, and many countries in the world are getting 50% or more of their calories from import. Things will get better before they get worse.
> They are now no longer exporting, and many countries in the world are getting 50% or more of their calories from import. Things will get better before they get worse.
It's not like they wouldn't like to export when they could. But they are not allowed to export due to various sanctions and limitations. It's almost like one side taking half of the world as hostages and letting them hunger, so they could harm and blame the other side.
But yes, "Carthago delenda est" no matter the costs and victims.
Obviously, inflation will destroy the value of wealth, and disincentivise future investment, so in order to reduce inflation, we need to raise interest rates.
>The Edict on Maximum Prices is still the longest surviving piece of legislation from the period of the Tetrarchy. The Edict was criticized by Lactantius, a rhetorician from Nicomedia, who blamed the emperors for the inflation and told of fighting and bloodshed that erupted from price tampering.
>During the Crisis of the Third Century, Roman coinage had been greatly debased by the numerous emperors and usurpers who minted their own coins, using base metals to reduce the underlying metallic value of coins used to pay soldiers and public officials.
The UK will last longer than the EU. The EU has a fundamental schism of a shared monetary policy, without a shared fiscal policy (see euro sovereign debt crisis). It also has a problem regarding the population becoming increasingly sceptical of freedom of movement, voting for more socially conservative parties.
Hopefully the EU can be reformed to go back to a trading bloc, with a liberal visa regime for member states, rather than an idealistic United States of Europe model, punctuated periodically by brutal austerity.
The culture in the UK is to live for the weekend. Weekend consisting of getting drunk and watching football. A lot of the people carrying it both in blue collar and white collar jobs are foreigners. Even when it comes to academics, go to any top university and you will forget you are in the UK.
As well as declining productivity per worker, they are also suffering a declining worker pool as more people are switching to part time, taking early retirement, or are claiming unemployment/disability.
This isn't the case. The stuff you read about this is just ludicrously inaccurate.
One, UK is growing at about the same rate as other developed economies. This is quite remarkable because, if you look at Europe, 100% of these countries have significantly higher unemployment.
Two, productivity growth has slowed everywhere after 2007. The UK is comparable to Western Europe, slower than Germany, faster than Italy, it depends heavily on what start and end date you pick. This isn't particularly surprising given that we essentially outlawed the most productive sector of our economy after 2007.
Three, the UK had no financial boom in the 2010s, the US did, and the EU did...let's just wait until the debt has to be repaid to see the full score on whether that has worked out economically.
> This saw select fruit and vegetables rationed in UK supermarkets, due to shortages caused by bad weather conditions in the South of Europe and Northern Africa and many growers having to cut back due to rising costs of heating greenhouses.
Besides the obvious degradation of the energy and fertilizer markets from the war in Ukraine, the collapsed Pound is probably the biggest factor here.
Uh, how does one source produce except through imports? A weak Pound will make it more expensive.
Even for things that can be domestically produced, like greenhouse tomatoes, they will still be more expensive even if they are now competitive with imports. And for items like rice and couscous you're not really going to be able to domestically produce them anyway.
The pound isn't particularly weak against the Euro. The shortages are because supermarkets won't pay for spot-prices, they'd rather just have little to no stock in the short-term.
Meanwhile in Sweden the CEO of ICA, the largest supermarket chain in the country (53% of the market) said yesterday: "It is actually the consumer who controls what they are prepared to pay for a product. In the end, it is they who decide." https://omni.se/icas-vd-det-ar-kunderna-som-avgor-matpriset/...
"Meanwhile" means there isn't any particular connection, but replying in disagreement is very common and on social media it's often assumed if ambiguous.
This seems to happen all the time. Someone is just trying to make conversation (like me, here) and people try really hard to see in what way they were attacked by the comment.
Can I just point out that my comment wasn't an outright contradiction either, people just assumed it must have been one (correctly, in this case) since it would have been a rather pointless observation otherwise.
In an ironic way, the consumers decided to leave the EU and expose the UK to higher inflation. Though much of the world has been seeing severe inflation at this time, it would have probably been better if the UK had access to a broader food market.
The inflation for these products came from the EU, the reason why prices for tomatoes went up is because Dutch farmers have been paying significantly higher energy costs (some supermarkets chose to hold no stock instead of paying these prices too).
The UK still has access to those markets. The problem is not that we can't import goods, but that there are fewer goods to import and they are being sold at higher prices.
For example, in January, food inflation in France was 14.8% and in the UK it was slightly lower at 13.3% and the OECD rate was 15.2%. It's not a Brexit problem; it's a production problem.
It's not a problem caused by brexit; it's just a problem made less severe by zero-trade barriers with the countries you're importing food from.
The UK is one of the most import-dependent nations in europe, and the world; it's easy to give good reasons to suppose had the UK been in the EU it would have seen below-average inflation.
When food starts to run out, governments serve their own people first. This is also true for the EU. If there's not enough to go around, the UK simply won't get to buy any.
That's true, except when food starts to run out, the French government will serve the French people, the Spanish government will serve the Spanish people, and so on. You're nuts if you think the Spanish are going to ship food they desperately need to Hungary because they're both in the EU.
Isn't that exactly what's happening with energy right now? I live next to a hydro plant that isn't even maxed at capacity and my electricity bill is like 8x what it used to be, simply because they "have to" sell energy at the whole EU market because someone somewhere desperately needs it.
The consumer decides what they are prepared to pay for a product, unless the demand is inelastic. And for food overall, the demand is inelastic. Consumers cannot just say "food is too expensive for me, so I think I'm going to to go without it this month".
They can choose between the individual products they buy, so it wouldn't be a problem if just some food items got expensive. But the price of food overall is inflating.
Demand for food overall is inelastic, but the demand for specific foodstuffs is elastic. The measure of inflation we're discussing is across all foodstuffs.
Expecting everyone to just give up meat and bread for rice and beans is nonsense. And eating too many calories is unhealthy, but who are you to decide. You're blaming the victim.
If the prices on hotdogs are like what I've seen at the store, no it is not. They're not priced quite like a steak, but it's close. And then you got the buns which are also like $5 for a 8-pack of the cheap store brand ones.
A lot of the basic foodstuffs -- dry beans, grains, milk, eggs, flour -- have all gone up in price significantly. I've seen prices double over the last two years on some of these.
They've gone up in price, but they still retain their status as the cheapest meat. The people who aren't buying steak are buying something else instead.
In fact, I believe that the price of hot dogs have gone up more than the price of steak has. Yet people are still buying more hot dogs and less steak.
You don't have to buy the buns lol. I remember using sliced bread instead of the buns because it's cheaper if you only use 1 slice to wrap the meat. I still see the $1.99 for a loaf of wonder bread or whatever it's called. That's plenty of slices for plenty of hot dogs lol.
And to add to that, these companies hide addictive processed sugars and additives in such you that can be psychologically if not physically dependent on things without realizing it.
This is an interesting point. It's definitely easy to switch to cheaper calories. Candy bars have high calorie counts and are cheap. Even today in the UK, you could buy 2000 kcal worth of candy bars for about £1.60.
And the inflation will push some people toward such food choices. Maybe not that extreme, but switching to cheaper food generally means eating less nutritious food (unless you were over-spending), which is awful.
Being pushed into single-digits spending on food daily isn't outside the realm of reality. £10 a day is about £305 a month. This is a lot of money for some vulnerable groups, like large single parent families, retirees, students, some young adults, and similar.
The inflation also harms people's diets in a several ways: you must buy less food or less nutritious food for the same amount of money, and you have less money for food as other expenses have inflated. What is worse, less healthy food demand has long-term consequences to do with its supply going down and prices going up further.
What kind of candy bars are those? That's like 10 candy bars. A US Hershey bar is only 220 calories which is pretty standard for a candy bar. The real MVP for calories at minimum price is peanut butter. A bottle of Walmart peanut butter apparently goes for $2.18 currently and is 2880 calories total.
I've been thinking about this for many years. I really think flour is the best ratio of calories to dollar. However, I've been unable to satisfactorily quantify the energy and time costs into equivalents.
In Germany I'm able to buy 1kg of flour for about 50 euro cents at Edeka. I don't know how much bread that makes, but it is A LOT. I'm certain that it is significantly more than 2880 calories.
Flour is clearly the winner vs. peanut butter when comparing price per calories. At Walmart.com it is $2.12 for a 5lb (2.26kg) bag which is about 8250 calories. But yeah, processing that into bread (home energy cost and time cost) is tough to calculate and probably depends on your situation.
Still there are in-between options - pasta for instance is more bang for your buck than peanut butter and is much easier to prep yourself than bread.
It's interesting this conversation evolved into one about the most cost-effective sources of calories. Unintentionally, it serves as a poignant reflection of how things are going in our times. Many people will need to consider cost of calories seriously soon, many already do so.
Cheaper food is cheaper for a reason. The human body doesn’t just require calories. You need other nutrients too: protein, fat, vitamins and minerals. Usual advice is to eat a balanced diet, but that is expensive. Even eggs are expensive.
If everybody starts eating even more trash than usual then that will cost the government more in healthcare costs.
You can eat a balanced diet just off of canned food and rice. The fact that people expect to be able to eat fresh bell peppers in the middle of winter is the issue.
Eating seasonal and preserved foods is how we survived before the age of refrigeration and global logistics chains and maybe we should reconsider what is normal.
> Eating seasonal and preserved foods is how we survived before the age of refrigeration and global logistics chains and maybe we should reconsider what is normal.
That we survived doesn't mean we had a balanced diet.
I've been off beef for a long time now (family of 5). My grocery bill is $2k/month and my kids are still young. I can't imagine what it'll be when they're all teenagers.
I was buying a piece of tenderloin in Costco once a week. In a short time the average price went from about $150 to $200. I could still afford it but something in me cringe so I stopped buying it. That is in Canada
Ground beef prices at Costco went up a boat load as well. Costco only sells things at most a 2% markup so Costco prices are a pretty good metric for inflation.
Looking at the conditions that "beef" is raised in - feedlots specifically - the price for beef is way too low. Of course it should be raised by laws requiring better living conditions for the animals, not by the operations staying the same but making more profit. Same for all kinds of meat really. I happily eat meat, and of the more pricey variety and not the cheapest I can get, but I'm willing to pay the price (and I'm not earning much) if the animals are treated better.
If that also leads to meat being a side dish instead of the main dish more often that's probably for the better for overall population health too AFAIK.
> They can choose between the individual products they buy, so it wouldn't be a problem if just some food items got expensive. But the price of food overall is inflating.
That is a false binary. You can still buy flour (or naan or pita), cheese and tomato sauce instead of pre-made pizzas, sacrificing your time against rising food costs. You can buy lentils instead of steak, sacrificing your preferences against rising food costs. Or you can travel further to a warehouse store and buy in bulk...
When enough people act empowered in the face of adversity, we don't have to sweat "greedflation". Retailers will learn their lesson.
Yes, I understand rising prices make life worse. But don't let anyone tell you there's nothing you can do about it. Learn to cook, change stores, eat differently, maybe even move.
"My Pizza Pops went up 25%, I am powerless in the face of inflation!" Just no.
If flour, cheese, and tomato sauce also go up 25% what the shit is gained from your entire post? The people at the bottom of this still have issues buying food.
Correct. Almost all flour-containing goods have a cheap version which is cheaper than making from scratch. Buying bread flour and making bread is usually a net economic negative, it's just something that people do for fun.
The exception is maybe if you've got a good Indian supermarket and can buy at the 10-20kg range, then churn out a lot of chapattis.
Ok so as an another commenter mentionned:
1. Spare time to cook food from scratch is a class thing. Most peeps have to work stupid hours.
2. To go to a warehouse and buy wholesale, you need #1 and make sure your petrol cost offset the savings which imho is absolutely unreasonable.
It's how rich Western Europeans say that the poor will revolt unless socialism. It references something some French princess allegedly said who, when told the peasants don't have bread to eat, replied that they should eat cake instead. Some claim it as a sign of the royal disconnect that lead to the French Revolution.
Apparently suggesting they buy raw ingredients instead of processed foods is the same as suggesting they eat cake if they don't have flour to make bread, because nobody likes the idea that consumers can adjust their choices.
b) making food from raw ingredients is cheaper than buying (at least some of the ingredients) pre-made. Again, it isn't for a surprising number of foods because, you know, economies of scale. Prime example is bread.
It is for a lot though. You can buy a kilogram of rice (or even larger amounts, price didn't move at all in Northern Germany), or you can buy the 2-minute-microwave-stuff (price did move). You can buy 2kg of potatoes for the price of 750g french fries. You can buy soup ingredients or you can buy canned soup etc etc.
Why do you think economies of scale wouldn't happen at the potato-selling business? Are they buying and selling individual potatoes?
We can go back and forth listing every single food under the sun, but the fact if the matter remains: food prices have gone up. Including for "ingredients".
It's easy to dismiss your opponent with "but rice and potatoes aren't more expensive". Well, I don't only eat rice and potatoes, and prices for other stuff like meat and milk has gone up.
No, "inelastic demand" is a specific term in economics. It means that demand for a product does not change much or at all depending on its price. Think about bathroom tissue, tobacco and diesel. Whether the price goes up 20% or down 20%, about the same amount of the product will be sold.
Elastic demand is the opposite. Some products have elastic demand, like luxuries and durables. An expensive car trim might be very price-sensitive because it is a luxury product. People will buy much fewer of those in austere times. They may buy fewer washing machines, too, because these products are durables. They are often bought "as an upgrade" or when one broke but could be repaired for cheaper.
> Consumers cannot just say "food is too expensive for me, so I think I'm going to to go without it this month".
One could be temporarily elastic, e.g. thaw meats from the freezer, eat shelf-stable food from the pantry. And in a few weeks, prices could be different and they do tend to bounce around week to week.
Also note that Lidl droppeded its prices and the others came out "predicting" lower prices just hours after Svantesson (finance minister) came out of that meeting with the oligopoly and complained about the lack of competition. I think they got the message, but will it be enough? I doubt it.
There is something called price elasticity of demand, which is how much demand reacts to changes in price.
Here we're discussing food... People have to eat so demand for food, at least staples, does not change much when prices rise as long as people can afford to pay (and by and large currently they can).
It should also be noted that in developed countries the price of food has collapsed as a proportion of people's income over the last 100 years. So the reality is that even if prices double demand will probably not change much apart from some arbitrages (go to cheaper brands/supermarkets, drop in demand of a few luxury items and non food items).
I hope that continues to be an option. In my neighborhood, they finally changed the signage from a merger that happened a while ago. I now have two Safeways within a mile of my house with the next closest grocer being a high end store 4 miles away and a discount grocer 6 miles away.
I fully expect one or both of those stores to be absorbed by the Safeway/Albertsons/Kroger monolith in the next few years.
The supermarkets in the UK engage in price fixing so consumer can only decide so much when each supermarket has the same price and smaller shops are priced out of the market.
In the UK where big business dominate, the competition is illusory and regulators turn the blind eye.
The UK politics seems like a separate level of dysfunction. It seems like all the worst decisions being made together. For some reason people voted for Brexit. The PM who was the chief Brexit Campaigner (Boris Johnson) had to resign because of entirely avoidable mistakes. The next PM had to resign too soon due to trying to bring policies which were not well thought out. The current PM had to be annointed since it didn't seem like the Party membership would vote for him.
It doesn't seem like Labour has a charismatic leader either. I could never even find a concrete stance by Corbyn on what he was running on wrt Brexit.
HNers from UK, what does the outlook look like policy wise for the UK.
"what does the outlook look like policy wise for the UK"
I'm hoping for boringly competent management of the economy plus a gradual drift back towards relatively friction free trade (both goods and services) with our largest neighbour.
Wage growth would be good and some action on housing so wage gains don't just turn into house price rises.
You’re spot on calling uk politics a separate level of dysfunctional. It feels like we’re stuck with a shower of gobshites for a while! Exporting immigrants to Africa is a particularly shambolic/shameful recent effort. And don’t mention ‘the Brexit’ - I’m not saying it’s the only reason but it’s certainly a huge pain point on many fronts.
I think UK politics is at a rock bottom at present but hopefully it’ll spur enough of us on to hold our representatives to a a higher standard…
> what does the outlook look like policy wise for the UK
Sunak will gracefully lose the next election, by a lot, but a lot less than Truss or BJ would have lost it by, and having helped to slow the freefall in reputation by the Tories and steadied the economy a bit. Keir Starmer will be a decent and competent but dull leader for two terms, and the who the heck knows. But the next ten years or so should be pretty dull, in a good, centrist sort of way, ideally culminating in rejoining the EU.
Demand for food is inelastic, so it makes sense that companies are raising prices as high as possible since people still have to eat. Generally this leads to price competition from other food brands, but when single companies own dozens/hundreds of food brands it’s easy to act like a cartel and keep prices high.
Also many people don't pay attention to how much food costs, at the point of purchase. It's all things that have low numbers that add up. e.g. when asked, nobody knows the price of a pint of milk.
I guarantee you that people trying to raise a family on a budget pay very close attention to the cost of individual items.
People might stop caring quite as much about individual pricing once they have enough money not to have to care.
People who have to worry "can I afford all of this once I get to the till" are very aware of how much everything costs, and they are more common than people who don't have to worry.
A pint? I mean no, but that's because milk is sold by the gallon. If you think people aren't acutely aware of the price of a gallon of milk then you live in a bubble of wealthy people. If milk rises above $3 a gallon or falls below $1.50 half of my Facebook feed has something to say about it. Same goes for many other standard products.
This thread title starts with "UK:", where milk is sold in pence per liter (and also "metric pints", which are pint-multiple containers quoted in mililiters)
Outside of chemistry, liquids are typically measured in litres (AmE: liters), a metric unit of capacity equal to the volume of one kilogram of water at 4°C (39°F) and at standard atmospheric pressure of 760 millimeters of mercury.
"Gallons" are not a universal metric:
For the US, 1 Liter of milk = 0.2641720524 (US) Gallons.
For the UK, 1 Liter of milk = 0.2199692483 (UK) Gallons.
Because this has been and still is confusing, the standard unit of liter was introduced as a universal alternative (no flamebait intended).
If you are poor and/or live paycheck to paycheck (for example due to your monthly home heating bills having gone from 400 euros to 3000 euros year over year), I can guarantee you, you pay very close attention to how much food costs.
I doubt it. I've read that Americans throw away 40% of their food. Obesity rates suggest people eat far more than they need to. And there are major choices in what to eat - cheap vs expensive calories.
> Obesity rates suggest people eat far more than they need to.
Obesity rates are also higher among poorer segments of society than wealthy, so it isn't necessarily a given that obese people will choose to eat less just because doing so will make them poorer due to higher prices.
It's likely possible that the lack of self-control that is sometimes related to overeating correlates with lack of self-control in other areas such as saving money or avoiding debt.
But that's not popular to talk about; nobody likes hearing about personal responsibility anymore.
It can also be a learned reaction due to past experience. Shortage or hungry times resulting in an instinct to overeat when food is available to act as a buffer should bad times come again.
Obesity reates in the US, from my observation, are a compound effect of the unavailability of affordable, healthy ingredients (fruits, vegetables) and cultural factors (a custom of never cooking healthy meals, for instance rice and vegetables, instead of consuming carb-heavy burgers and sugary milk shakes and coke at fast food outlets).
Friends in the US drove school buses during the day and worked at Wendy's at night, only to give back a substantial part of what they earned to Wendy's to cover their dinner there. They didn't even realize what slavery they were caught up in.
Hmm. Napkin math assuming its 40 gallons of sugared soda at a reasonable 20g per 8oz serving is 640 servings, 12800g of sugar, 51200 calories, or 14.6 lbs of empty nutrients on average a year if it all got replaced by calorie-free sweetener.
How much is 40 gallons? 426 12 oz cans of soda, 35.5 dozen cans, or 256 20oz bottles of soda.
I wonder if the bad quality of the majority of tap water has an effect on soda consumption. How much less soda would we drink if every residence had on-site water filtration?
Yes, and we have a culture of overwork so even if people did want to cook at home they’re too exhausted or short on time to consistently cook healthy meals.
If humans behave rationally and eating healthy is cheaper and healthier why don’t more people do it?
I'm not sure how this cartel like behaviour works in the UK where every major supermarket has its own range of competing products - and then there is the likes of Aldi that is 90% stocked with brand lookalike knock offs?
There are currently competing narratives in the UK about food prices - greedy supermarkets v poor farmers and the same people complaining then say they shop at Aldi because it's cheaper.
Food is still cheap - it represents a small percentage of people's income. However, in the UK, we are beginning to see that food produced without the benefit of slave labour is somewhat less cheaper than it used to be.
> Food is still cheap - it represents a small percentage of people's income.
If you look at it as an average for the population, sure. But that masks the real issue, which is that it hits poor people the hardest because spending on food doesn't scale proportionally with income.
Let's check this empirically. Which cartel-like brands are publicly traded and publish financial reports? We can look at their profit margins next quarter.
It's probably better to look at the margin, I could see how the profits increased in absolute numbers as people may have switched from eating out to home-cooked food.
I don't know, but I would not be too surprised if local / smaller producers are a bit better represented for restaurants. In any case, profit margin should not be sensitive to this.
Profit margin increased by 230 base points that represents a 14% higher margin.
130 basepoints if you use GAAP measures so only ~7% higher margin then but clearly unilever doesn't just have higher costs but is also increasing their margin.
Margin will also help discount issues resulting from Covid; a company that lost money during Covid (think restaurant suppliers) would go to a profit when it was over, but are they making MORE margin (percentage) than they were before Covid?
If it owns all brands and they raise the price, then start your own food company offering lower prices, you will turn up the market to you like from day to nite.
It's both increased wholesale food costs and price gouging. Profits have never been higher all along the board. Everyone in the chain is "passing the cost on" and also taking a little extra cut.
gouging is an incredibly unhelpful context in a macroeconomic sense. In cases of shorter term scarcity (e.g. toilet paper during early covid), you can have instances of gouging. But over a longer-term period where prices are calibrating to demand/supply dynamics, price increases simply reflect the shifting balance between supply and demand.
Should we be concerned about why there are shifts in demand/supply? Sure.(In the case of food, part of this is driven by the UA war and likely other trends in food productive)?
But it is eminently unhelpful to simply attribute increases to 'gouging' and expect that to be the final say.
Increased prices and price gouging are not the same thing. If production costs are up, and they are up, then prices can go up without anyone making any more money. You have to actually look at why prices are going up.
The other factor is that rising prices often mean an increased need for investment by producers. That investment capital has to come from somewhere, so what look like increased profits based on current cost structures can actually be entirely justified if the company then needs to invest that money in order to get production volumes up and cope with increased capital costs.
I don't know enough about the food industry to be able to say which of these is happening, in which sector or country, but these are much more complex issues that the knee jerk reactions here imply. What I can say is, it seems to me that if the reduced supply from Ukraine and Russia is going to be made up, somebody somewhere is gong to have to ramp up food production an awful lot, and I can't imagine that's going to be cheap.
> Increased prices and price gouging are not the same thing
Considering that's the explicit context of this comment thread, obviously, the difference is exactly what we're talking about here.
> I don't know enough about the food industry to be able to say which of these is happening, in which sector or country, but these are much more complex issues that the knee jerk reactions here imply.
That's what I mean about sparing a company's feelings. You have no material objections, but it's important we not use the word "gouging" for companies whose profits are rising considerably faster than inflation and it's consumers being hurt. Tone policing is the least important (and least interesting) part of this conversation.
I think the point is a little finer than you think. Yes, profits are up, but can you necessarily conclude from that single fact that the issue is price gouging? In a scenario where every company is trying to maximize profit, "price gouging" cannot explain why prices are increasing now in particular. Other things can, such as the elements pointed above. In an industry with a lot of competition, I find it much more productive to discuss what are the macroeconomic elements that cause inflation than whether the selfishness of corporations has increased recently.
Increased prices (and sufficient demand to justify the price increase - e.g, overall profit increase) is part of the interaction between demand and supply. Sure, demand for food is inelastic, but there are plenty of different suppliers at each level of the supply chain (different food brands, different grocery stores, etc.) who are individually acting to support the price search function (via individual profit maximization).
Price is a signal of scarcity. Food is more scarce due to supply chain issues, therefore food is more expensive. Is that bad? Sure, let's address the supply chain issues, overall macroeconomic inflation and, uh, other disruptions (incl. the UA war).
Unless you are specifically alleging direct conspiracy between food producers to raise prices (e.g., monopolistic action), (also already an illegal thing), there doesn't seem to be a clear call to action here.
if any given step in the value chain is increasing their prices beyond what is necessary to cover increases in costs (they are), that additional margin purely for the purpose of wanting more money is, imo, pretty shameless when it's hurting so many people down the line
In the US, M2 increased 70% in 2 years. Of course prices are going up. Anything less than a 70% increase means companies have a ways to go to catch up.
I'm not sure about 70%, I can only see 33% in open sources, but either figure is huge and now everyone is with Pikachu face and blames everything but helicopter money.
and i don’t think you’d expect it to. the increased supply needs to hit the market first. depending on how that money is distributed, that could take a long time. also remember that QE has been central fiscal policy in the UK and US since basically 2007. and it’s safe to say that concentration of this wealth is.. very high.
> has UK M2 declining [..]
it becomes a bit more sobering when you look at the full scale on that graph (when the y-axis starts from 0). it’s a metaphorical deck-chair-thrown-off-of-the-titanic amount of decrease.
The contention was that the rich always want high inflation to stiff the poor. I’m just pointing out that’s not berm the case for, I said 20 years, but it’s actually been 30.
Yes we have high inflation now, but that’s just been a plain old cockup. The massive inflation reduction act stimulus for example.
Those are nominal profits, everyone is trying to take "an extra cut" to stay ahead of inflation. Grocery has razor thin margins to begin with and the usual direction of prices is downward. Inflation will absolutely put a grocer out of business if they can't stay ahead of rising prices.
After tax profit margins for grocery retailers in the US range from 1-3%, some places like Whole Foods approach 5%. Gross margins are higher, but net margins are what determine whether or not you go out of business.
I've seen a convincing argument that this is energy price inflation being passed on down the pipe. Certainly for out-of-season foods grown in greenhouses, leading to the UK tomato shortage of last month. (Anyone else see "max 3 per customer" on various fresh fruit and veg?)
>Profits have never been higher all along the board. Everyone in the chain is "passing the cost on" and also taking a little extra cut.
This feels correct, but if that were the case, if companies are generating record profits, why aren't we seeing that reflected in stock prices? At the very least, why isn't price / earning ratios cratering?
the dollars are lower as a result of their actions increasing profits
they only need to increase prices to deal with the increase in costs, and profits represent an increase above and beyond that necessary amount, which in economic terms is "not cool, dude"
All well and good except for the fact that these companies have gone on the record in their earning calls to say this is just them squeezing the end consumer as much as they can. But go ahead and makeup some false justification to defend them against the truth of their own words.
Dude, did you even read my post? Yes that is happening in the US, I said as much. In the UK, profits are down. For the most part in both cases, I'm sure there are exceptions.
Acting like "food" is a company is absurd, there is a ton of competition and substitution in the market, no one actor has the capacity to influence "food" prices in general. If they did, then were they just being altruistic three years ago by not raising prices?
This isn't how the market works in the UK, or anywhere close to it (because distribution is heavily consolidated).
The main change has been energy prices (it is complex because supermarkets stopped selling some products, so the price recorded is not what consumers experienced because the product largely wasn't available).
Also, just generally, that isn't how demand for food works either. It isn't elastic, there are substitutes for every product. The main factor driving differences between countries is usually the structure of the food supply chain and exposure to trade.
You’d be surprised at how few importers actually provide most of the imported foodstuffs in the U.K. - Lamex and IPL for instance. Brexit has made importing untenable for a lot of smaller operations due to the red tape, and many have moved their buying to import agencies or domestic wholesalers.
There are quite a few significant supply bottlenecks in the U.K. food supply chain, from supermarkets to wholesalers to importers, and they do allow for price fixing - demonstrably so in the case of supermarkets and domestic produce.
Not to veer off into the psychology of it, but there's just such an overwhelming desire by most people to place blame for any misfortune on some intentional human behavior.
It's the root of conspiracy theories - it's much easier and nicer to think there's some cartoon villain somewhere making your life miserable; it's much harder to admit that the world is just annoying and painful.
Also with a "big evil" you can tell yourself that removing that evil would solve everything.
A lot of times, the villainy is really the collective self-interest of thousand of people in a supply chain or open market. No one is going to willingly pay more or sell for less than they can get at any step of the way.
I use housing as a good example since it's been a major driver of inflation and most houses are sold peer to peer on the open market. If you're selling your house and you see comparable houses selling for $900K, but you only need $750K to earn enough profit to buy your next house, what are you going to do? Sell for the lowest price you can afford? Or sell for the highest price you can get? You'd sell for the highest price. And that same calculation gets played out at every level of every transaction in every corner of the global marketplace. Yet nobody would think of themselves as being a villain for doing it. Or be accused of gouging.
From that comes NIMBY; everyone agrees that something should be done but nobody wants to do it. We really don't like be presented with 'we cause things too.'
The house sale is a perfect example, and is something to meditate on. (One solution is 'competition' such as making sure new houses are being built, other companies can produce food, etc.)
I see a lot of millenial/gen z commenters complaining that the previous generations were able to build wealth by buying affordable homes and watching them appreciate faster than inflation. And they want in on the same deal. It's simply not possible. For one, we haven't built housing to keep pace with population growth which skews supply and demand. NIMBYs are a big reason why. Secondly, in order for a home to be a valuable investment, it must by definition become less affordable for the next generation. Otherwise, it's not increasing the wealth of the owner. The only sustainable option is to match supply to demand such that houses pace or even lag inflation which makes them no longer be a viable store of wealth and instead remain affordable and available to everyone. The Boomers got a sweet deal and realistically, no one should ever get that deal again.
Well, also, we know from behavioral economics that people behave their most irrationally when they try to perceive value.
When a store runs out of flour, people don't get as mad at the store as if they raised the prices but keeps flour on the shelf. Despite the fact that having an expensive option for flour always leaves you better off than having no option.
After Hurricane Katrina there were some prominent examples of people being arrested under anti-scalping laws for trying to haul in food and generators from other areas to sell.
It's always the case. Someone, somewhere, is taking the opportunity to put prices up. It might be in some cases that it's triggered by a shortage, but they're still putting prices up because they can.
I appreciate the feedback, but I think it's unhelpful to dismiss what I said as "lazy". I have an economics background and am certainly not a "blame corporations" reactionary.
Companies are smart. When news gets spread far and wide about a shortage of eggs or other products due to disease or wars or "supply chain issues", they leap to take advantage of this consumer consciousness by increasing their prices, knowing the consumer will blame the larger macro factor and not the company. This has been well-documented, even in cases where the supply chain issues didn't actually impact the company that raised prices.
The best way to understand what's happening is via corporate earnings calls. They're upfront with their strategy when talking to investors.
Sure, but firms reacting normally to consumer price inelasticity during supply shocks is not exactly noteworthy. The noteworthy thing here is that there are supply shocks on so many different fronts at once.
I don't deny that corporations will try to make a buck taking advantage of favorable price-over-volume plays when they can, but I think it's crazy that people think during a global energy and fertilizer shortage Walmart just decided to throw out all of their low-price volume corporate strategy just to screw customers over egg prices.
I'd expect decent firms to not try to gouge customers who are already hurting at the time when they most are, but maybe "normal" means "sociopathic" in the context of amoral unrestricted capitalism
Housing works the same way, and we've seen the result of that. If food distributors are able to coordinate price increases without direct collusion, expect it to go the way rent has.
so gullible people not paying attention to their profits would just blame inflation for the entire price increase rather than recognizing that greed is driving a chunk of it
We had shortages of ammonia, a key component of fertilizer, last year. That drove up fertilizer costs. Not a huge surprise when the output goods are then marked up.
This. The last part, thank you. I think it's a major problem in the economy today. For a market economy to work there needs to be competition, but there's too little of it. If the prices are too high, the market response should be to produce more. But it's not happening - even if you produce something you need to get it in stores and every country is dominated by a few huge chains. They don't want to do business with small time producers. So in multiple parts of the chain you have entities that can basically do whatever they want.
Animal feed makes demand for food highly elastic. Simplest example, you can convert #2 corn to cow feed and make 1 calorie out of 7, turn it into chicken feed for closer to 1:2, or turn it into corn-based food directly. People can and do shift consumption to cheaper substitutes, like chicken instead of beef (or oatmeal instead of eggs for breakfast).
Demand for food is highly elastic. Food is not a homogenous substance that costs the same to produce each kind. When people are feeling more flush, they will consume more expensive food products (lobster, beef, fish, berries, mussels) and when they are feeling more price conscious they will economize on cheaper products (wheat, lentils, rice, tofu, chicken, beans, vegetables), and by wasting less food. We're talking about literally thousands of different ingredients and products, produced in different ways in different regions, that can to one extent or an other be substituted for each other.
Many of the workers in these factory jobs decided it was a good point to retire, decided it was more worth it to stay home with their kids, found a calling in a different career, went back to school, etc. This all had had ripple effects throughout the supply chain, making for less goods available. Combine that with low unemployment, hence many folks competing for those goods, and it's easy to see why we are where we are.
Something interesting is that this article breaks the narrative about it all being about the vegetables and the weather. Veg inflation was 18%, slightly below the average. Several other food categories like grains and fats had higher inflation.
This certainly seems to be more of a sign of a weakening pound not buying as much in n imports than something about food alone.
Not related but The price of poultry has gone up significantly in the GTA, and a friend who works for the government informed me that there is an outbreak of bird flu in Ontario that's affecting poultry farms. Unfortunately, farmers can't talk about it due to ag-gag laws.
Unsurprising. Over 58 million US chickens have died of the H5N1 bird flu in the last year. Although it seems to have slowed down considerably in the last two months. Currently, South America is having a lot of problems with the same strain.
The Canada Food Inspection Agency publishes weekly estimates of the number of birds affected by highly pathogenic avian influenza infections. The numbers seem relatively high (any number above zero is concerning), but they have barely increased since January:
Week ending 2023-01-18: 748,000 birds affected in Ontario, 7,051,000 in Canada [1]
Week ending 2023-03-22: 749,000 birds affected in Ontario, 7,173,000 in Canada [2]
Media narrative obviously. This looks like a story about the war’s effects on energy and resources. Better to redirect people’s anger so they they don’t lose their appetite for the proxy war.
I'm curious why the values aren't identical to within rounding errors for countries like the Netherlands and Belgium which are nearly the same size, in essentially the same location, and don't have different amounts of welfare like north/south Korea or USA/MX.
Can't be that one has tech or purchasing power that the other doesn't, or that food needs to travel a lot further, and I would also not expect vastly different foreign relations (also because EU, but also because the countries are so similar in beliefs and histories).
And similar for slightly different but still nearby and similar countries like Germany, Luxemburg, and the UK. Anyone know what causes these differences?
Edit: to answer your question, I wouldn't look for meaning behind that but rather assume that a limited scope article is a lot easier to write than a broadly scoped one. In the ~global context of HN, the headline then sounds like they're singled out.
A shortage of low-cost labour on which the UK has long been (perhaps too) reliant, and reduced inefficiency (= higher cost of) the import process.
Or, in a word, Brexit.
Everywhere is getting inflation. Supply chain disruption, Ukraine war and a dash of climate change (hasn't really bitten yet compared to the other two). Britain seems to be getting about 5% more than everywhere else.
Isn't the reason because the lingua franca of HN is English? If people were posting articles in other languages, there'd be a more representative set of criticism.
In general there seems to be a weird zeitgeist of negative exceptionalism in the UK at the moment.
Not sure why but generally journos seem to write about issues like they are only hitting the UK when a simple google search shows they aren’t.
It does come across like a weird concerted effort to paint the UK as collapsing since leaving the EU. The majority of journos seem to be able to write only negatively about UK current affairs unless you read something like The Express who are delusional in their own right.
Most recent ones I can think of are the failed space launch and British volt going under.
These were both highly ambitious projects that had a high chance of failure, especially the space launch. It’s unlikely you’re going to get your first launch right, famously it takes many attempts.
When both of these happened journalists seemed to revel in the failure. It was very odd to see.
I understand with these two examples a lot of it has to do with government/brexiteer chest thumping which shon a spotlight on them. However it was still odd to see.
I think this then trickles down to places like HN (who’s membership generally has a bias towards remain) who also see an opportunity to revel in it.
This is odd as well because I can see why Britons or Europeans would be passionate about membership in a regional trade bloc, Americans who get really passionate about it confuse me. As a Briton I didn’t really care when America left NAFTA.
This is assuming the majority of people on HN are American but based on time zones and when articles are posted I’m probably wrong.
Edit:
This is a UK based publication writing about Groceries in the UK which is why it’s so specific. Your comment just spurred something I’ve been thinking recently.
> In general there seems to be a weird zeitgeist of negative exceptionalism in the UK at the moment.
Especially on Hacker News. I tend to avoid UK-based posts on here because the content is fairly predictable: the UK is going to shit and Brexit is to blame, repeated ad nauseam in the absence of any evidence that it's true. If I wanted thoughtless UK doom mongering, I'd read the Guardian or the NYT.
Yeah I do the same. It seems to permeate into everything, even positives.
UK announcing research into x: comments will probably be negative and about how it’s a boondoggle.
UK company doing exciting stuff like fusion or quantum: comments will probably be negative and about how it’s a boondoggle.
It’s tiring.
Edit:
That being said it does lead to hilarious moments where I’ll read the Guardian and see a headline like “The NHS won’t make it to Christmas (for real this time) but it doesn’t matter because we’ll all be dead by then because of Brexit” and then I’ll see the Express in my corner shop with a headline like “Brexit HERO Boris makes Ursula von der Leyen CRY when he announced new BRITISH MOON BASE”
- Governemtn forecast 4% lower GDP than without Brexit
- UK car industry significant decline in output since 2015 (around 30% IIRC)
- People who immigrated here for work (and have the right to stay) are choosing to leave
- Low investment compared to comparable regions / countries
- Turmoil around NI
- Banking migrating to Europe and New York in particular
- Trade deals not materialising
It’s not what “project fear” warned us of, but it’s certainly not good. Many of these effects are playing out across years so haven’t really hit home for people yet.
It's because there are narratives to follow, sides to pick. There's no room for facts by themselves, they have to fit some story your pack has bought into.
Right, left, middle, or anarchy, it's all the same; you're part of a herd.
I see a huge difference between people online and normal people.
Obviously we are going through a tough time at the moment. While there are some things unique to the UK (such as the nurses and junior doctors strike), for the most part what we are experiencing is common to most of Europe and often even the USA. I mean look at France - Paris is drowning in rubbish due to bin strikes and protesters are setting things on fire - yet if anything that seems to be being covered as something positive for them. People taking back power and exerting their rights. Last time that happened here, though, it was treated as an almost apocalyptic event and emblemic of Broken Britain. Sure the Paris strikes are ostensibly about pensions, but really they're about more than that.
By default, Brits tend to lean toward the negative side. I think even before Brexit/Tories/etc. most British people would broadly have considered the UK to be a bit shit, and generally complain more than they say anything positive. However, when measured, the UK is in the top 10 countries on a huge number of metrics and isn't particulary awful at anything. I do find the general negativity a bit tiresome, but it's not entirely a bad thing. That negativity is probably partly behind why we have managed to become and remain such a successful and stable country for so long.
Online, though, British people seem to be incredibly negative in a way that I've rarely experienced in person. I figure one reason why people online are so unflinchingly negative about the UK is that online Brits seem to lean very hard left and we're now on our 13th year of Tory leadership. I'm pretty lefty myself, but an awful lot of the chronically online UK types are literally Trots and Tankies (who are, nevertheless, pro-remain #FBPE, despite the contradiction between those views). Look at, e.g. Corbyn's online popularity versus his real (un)popularity with the electoral base. Or how the Tories actually generally get a similar popular vote to Labour, but online it's hard to find a single person who expresses any support for them.
I also think the UK generally gets its news about Europe from US news sources, especially when it comes to economic policy and comparisons. The US news (especially NYT and such) love to paint the US as a capitalist hellscape compared to the utopia of Continental Europe and the Nordics in particular. In reality, of course, the EU and Nordics are a lot more complicated than that, and in socioeconomic terms we're a lot closer to Europe in most ways than we are to the US, but that doesn't seem to feed through so people draw the same comparisons that are popular in US papers. You also get that with the NHS vs USA's system, as though those are the only two options.
With Hacker News being predominately English speaking I suspect plays into why we see more US and UK (and other English speaking countries) related posts vs non-English speaking.
And of course people do love to point out where the UK is suffering these days to put a Brexit spin on it (whether fair or not) as it gets them clicks. Much like a famous or young person dying is almost always reported as "died suddenly" these days regardless of nature of death as it gets clicks with all the anti-vax crowd.
Its not average for Europe. Aside from Germany, rest of Europe is at around ~10%.
The UK is being singled out because its not able to import the groceries it used to do before Brexit now - there has been a low yield crop season in most parts of Europe and the domestic demand for groceries has literally exhausted the supply that can be exported. Since the UK is out of the Eu, its not possible to access the Eu domestic supply anymore and it has to wait for what remains for export.
> The UK is absolutely capable of tapping EU supply,
I don't understand what are you trying to falsify. CNBC or their news about the UK not being able to import as it used to from the Eu.
"...James Walton, chief economist at the Institute of Grocery Distribution, told CNBC: “The U.K. is highly reliant on imports of fresh produce at all times of year, especially in winter — the EU accounts for much of this import volume. If there are shortfalls in production in the EU, then it would make sense that EU producers would serve their local demand first. This leaves less available for export to the U.K...”"
Having a 'free' trade deal does not mean that you will get priority over the domestic buyer as an outsider.
> I'm eating Spanish cherry tomatoes as I type
Your personal experience does not constitute a statistic.
I (we?) were discussing food inflation, but generalised inflation is higher in the UK - 10.4% Vs EU of 9.9%.Not a massive difference.
You said the UK, due to Brexit:
> Since the UK is out of the Eu, its not possible to access the Eu domestic supply anymore
Which is just plain not true. Deprioritised, sure, but not unable. A lot of people take the Daily Mail seriously (including other news outlets too) when they say stuff like we can't get tomatoes. It just meant I went to the other shop across the road instead.
The argument was about inflation, not food inflation alone. Even if only food prices are considered, one can say that its hard to trust UK's numbers in anything since the Tories that are ruling there have very funny ways of measuring things. Like how they recently have declared that homeowners were actually 'creating and also consuming rent services' and bumped the UK's GDP a fair bit.
Even we gloss over it and trust the UK's own numbers, the Eu inflation in February would have been driven by mostly Germany with ~24% inflation compared to the ~10% most of the major countries have.
...
However it still does not make any difference since prices are irrelevant if there simply arent groceries and they are being rationed. That was the point.
You're either completely misunderstanding all of the figures you're reading, or you're arguing in bad faith. This has already been explained to you by others, this is my last message to you.
Either food inflation or general inflation, the UK has similar rates to the rest of Europe.
The Tories are not in charge of deciding the inflation rate in the UK, it's from the Office for National Statistics and all the financial lenders would be very quick to voice their disagreement if they thought otherwise. Suggesting that the values coming from the UK are fake is an extraordinary claim which you have no evidence of.
Germany has a general inflation rate of 8.7%, this is below the EU average. They are not driving it up.
Groceries were rationed because UK supermarkets refused to buy them at spot-prices. The UK had a shortage of peppers while Sweden etc had peppers at 10€/kg.
But the core reason for those shortages were poor weather in Spain etc where the produce is grown, I'd be surprised if the EU didn't have the same issues.
I wouldn't be surprised if those countries such as Spain reduced the amount available for export so that they can meet demand for local markets though, but capitalism would dictate that they sell to the highest bidder instead.
The Economist ran a story the other week on the topic of food costs talking about how the tomato can be looked at as a type of energy store & how British supermarkets differ from other European supermarket chains by rationing out veg rather than increasing pricing. [0] This was to say the "shortages" were more of a quirk of the British market rather than purely due to Brexit.
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[ 0.19 ms ] story [ 386 ms ] threadDoesn't anybody read what they write?
Circumstances materially changed over the last few years, and inflation is a great time for profit taking as we're seeing, which reinforces the inflation. In a competitive environment the excess profit-taking should start pulling back eventually, but in the meantime the prices are going to the moon.
> They didn't have the pricing power/their customers didn't have the tolerance for rising prices/
Just for everyone's sanity, it's WAY easier to believe that there are underlying market conditions that should be addressed and not worry too much about retailers. They are just doing marginal pricing. If there is a shortage on eggs, it's better for everyone that they price eggs so they stay on the shelves than to price them as if nothing is happening and then people panic because they can never find them anymore.
The profits may be up, but the revenue is still down overall.
There's some empirical evidence from Australia that this is exactly what they did. Also an island nation that heavily imports food
https://www.theguardian.com/business/2023/feb/24/an-economic...
I don't know why people get so hung up on this though: If you have less stuff to sell, and fewer employees to sell it, your profit margins are going to be higher! That doesn't mean though that you are maximizing your revenue potential. Which is probably why despite all of these reports of "record profits" you are not seeing exploding stock evaluations.
Also, it doesn't hurt that inflation is always going to be favorable to retailers. You buy inventory at the pre-inflation price and sell it at the post-inflation price. Even if you just price to keep up with inflation, you are going to report "record profits" every quarter just by nature of inflation.
I'm not sure this can be approached from a rational examination of economic premises alone. You raise good questions. However political economy also should be considered.
Let us imagine for a moment that this narrative is being advanced to deflect from government largess in the economy. Under this scenario court economists have an interest in protecting the regime, while the regime and academic institutions generally have a symbiotic relationship. If these incentives make sense, the narrative can be better understood in this political context.
Unfortunately this hypothesis suggests that there is very little we can say here without this discussion devolving into the regular flames we see on this topic.
Therefore you can see prices fixed for years, and then suddenly a sudden flurry of lots of manufacturers all raising prices 50%.
There cannot be anyway Arizona Ice Tea is making the same profit today on their .99 cans that they were in 1992.
And at some point that has to break unless they become a charity subsidizing aluminum-clad tea.
When "the break" happens they almost always overshoot; it's easier to offer a 'discount' later if necessary.
https://www.latimes.com/business/story/2022-04-12/az-iced-te...
Long story short: they reduce costs (thinner cans, no need for heavy marketing because fixed price is the marketing) and aren't greedy, playing the long game.
A price were willing occur until surviving companies are making minimal amount of profits.
Related is if someone figures out how to produce the same amount for less effort/cost.
If someone is making absurd profits for long periods, then usually some major factor such as government regulations is preventing new players from entering the market.
Supermarkets are expensive but still not expensive enough for someone to bootstrap an operation to elbow themselves into the market as a new player and expect to still make profit.
> A price were willing occur until surviving companies are making minimal amount of profits.
> Related is if someone figures out how to produce the same amount for less effort/cost.
Existing supermarket chains have massive delivery networks and associated efficiency, already have
- the real estate and - all the internals of a retail store and - the associated warehousing set up, - all the personnel who know their way around the store and where everything goes (which is a huge part of the efficiency of distributing the wares in the store), - "brand" recognition of the store (Aldi, Tesco, Walmart, ...)
which means the new competitors would very likely have to massively loss-lead at a time when the already-established market participants are making more profit than before.
> If someone is making absurd profits for long periods, then usually some major factor such as government regulations is preventing new players from entering the market.
Selling foodstuffs especially is an area of business where a huge chunk of regulations are absolutely justified and it's not like all of the food singled out because of expired shelf life ("MHD"/"Mindesthaltbarkeitsdatum") is getting thrown into the garbage (at least here in Germany). I currently work in a supermarket and have done so in a different chain before this one and from what I know most damaged or "expired" food is getting written off and then either set aside in the appropriate temperature store-room for the "Tafel" (food bank) OR if it's really unfit/unsafe for consumption (moldy, completely interrupted cold chain [1] or obvious signs of spoilage like bloated food packaging) it gets thrown into the garbage.
Raving about "free markets" from ones ivory tower is all well and good but the reality is that because of corporate consolidations and necessity-for-living many economic sectors are effectively locked down by (implicit) cartels, either because it's cost-prohibitive to even enter - let alone succeed in - that market or because the actual necessary infrastructure has been divied up between the current market participants (think USA and their local mono-/duopolies of ISPs).
[1]: For example when we find items which should be kept cool or frozen in other areas of the market having been taken and left there by customers who obviously don't care (like that one time I found fresh fish with its plastic bag bloated to bursting in a warm section of the market during summer time, thankfully the packaging wasn't damaged or it wouldn't have been pretty).
The core problem is that Western countries have collectively decided to dial back anti-trust enforcement that could have stepped in.
Never let a crisis go to waste.
Scroll to page 9 for a good graph on how this works. Unit profits are massively up, unit labour costs stagnant.
I understand it's probably a mix of both, but it's hard to tell the relative proportion as a consumer.
What's the reality? In London and outside?
Sounds just like the roaring twenties.
I suspect the "formal economy" is hurting in a number of places, just not the energy sector.
0: https://www.bigissue.com/news/social-justice/we-asked-expert...
I can't walk down the street any more without saying hi to people, the chippy guy who goes on Sunday runs, the coffee shop owner who lets me know when they're trying a new roaster, the elderly women walking their dogs at lunchtime. It's almost like my old hometown.
Has only gotten worse, it seems.
So things are getting noticeably worse but I wouldn't use words like collapse just yet.
Anecdotally at least:
- Brexit is a pretty notable economic negative, purely in the sense that it's added a lot of drag to EU trade and made it harder for workers to access the UK market. Nobody likes loads of red tape. It's hard to separate this from the many other influences from COVID through to Ukraine.
- There has been a pretty clear spike in the cost of living, which has a direct impact on things like poverty. Notably the housing market was very disrupted by the policies of the previous prime minister; again, it's hard to separate this from anything else but anecdotally a very large number of people noticed that they suddenly had to find hundreds of pounds of extra money every month due to housing end energy costs.
- The NHS is not in a great state, no. Several years of underinvestment and the pandemic came home to roost, and combined with the pandemic and rather a lot burnout it is not sounding great from anyone who works there.
- The economy isn't in "free fall" but does have several things dragging at it – including supply-chain difficulties, inflation, worker shortages, and other challenges. It's hard out there.
- Most noticeable and in-your-face thing for someone like me—in the fortunate position of being on the breadline—is an obvious deterioration in services and availability. Lots of strikes in various industries, quality of everything suffering, difficulties getting basic goods sometimes. It can feel pretty oppressive, though of course nothing compared to how some people must be struggling to get by at all.
* Energy prices are higher, and this has had a knock-on effect, but I see it more on childcare (e.g. nursery) than food.
* There have been shortages of some foods - specifically there were shortages of tomatoes and peppers for a week or two a month or two ago, but not recently... and there are shortages of eggs, which I understand from my cousins, who are egg farmers, is primarily due to bird flu (most eggs in the UK are from British hens).
* Regarding NHS, we've not needed to use hospitals recently, but access to GPs has been same as usual.
* I've not seen an increase in crime.
* I hear that poverty is rising, but don't have direct experience.
* The Royal Mail is almost certainly dying, but I think it's been on its way out for years.
Like I say, this is just personal experience - I appreciate that I'm quite lucky at having an OK-paying job, so could well be insulated from problems that others face.
Food here is, empirically, still unbelievably cheap. I can buy a 500g bag of spaghetti for 28p, lentil and beans are cheap, bread is relatively cheap, chicken is so cheap that you wonder how safe it is...still...but the problem is that in the UK, if anything doesn't benefit you immediately then people will complain.
RM...they had a monopoly, their workers are almost always threatening industrial action, like they aren't "hanging by a thread"...they have a licence to print money, workers just won't turn up to work because they feel aggrieved.
NHS...funding is through the roof, the biggest individual component of the budget with a deficit of 5% and tax % of GDP at all-time highs...workers on strike, "they get paid more in Australia" (true of almost every job in the UK because Australia also has significantly higher CoL).
Crime? Again, we have an underclass of people who commit all the crime, repeat offenders often walk free over and over, shoplifting isn't investigated, robberies aren't investigated...and people wonder why it is attractive to commit crime?
Poverty hasn't increased, unemployment has dropped like a stone over the past ten years, all this time we have people like you: the economy is in FREE FALL, poverty is going to rise soon...it hasn't happened, the issue we have is that people are constantly feeling aggrieved. This seems to be a disease of the West too, you see the same thing in the US where there are real economic issues but there is very little discussion of them...all it is just single-dimensional, "things have never been so bad" grievance-building.
But no, nothing has really changed. Life carries on unsurprisingly. The UK has issues, food prices aren't one (in fact, food prices are far too low still), problems that do exist remain unaddressed, problems that don't exist absorb all of the attention.
If the logistics work, delivering letters only if there's a first class letter to be delivered, if there's a standard letter that's been waiting more than 2-3 days, or if Royal Mail feel like it (e.g. delivering to this road for someone else's first class letter) might save a lot of money.
32, tech worker, just bought a house in a village in the south... Yes my vegetables are a bit more expensive week to week, maybe i need to go to another store to buy one or two specific things but generally life is fine.
Still getting pay rises, still getting bonuses. Generally life is more comfortable for me than its ever been.
Someone set fire to a bin last week, does that count as an increase in crime?
Food bank use is clearly rising.
Royal Mail international shipping was down for at least a week due to ransomware: https://techcrunch.com/2023/02/23/royal-mail-restores-global... ; they are in general badly managed, but few delivery companies are ever loved.
Crime is not necessarily exploding, but confidence in the police is rather low. A Metropolitan police officer was jailed for 71 counts of sexual assault earlier this year, having done quite a lot to raise the crime rate all by himself.
We are not yet back to early 80s tent cities.
> Bread was up 20.8%, with pasta products and couscous up 25.3%
This is unjustified. Under no circumstances could this happen unless a) price gauging, or b) supply chain is drying up.
Edit for the ignorant:
> The UK is largely self-sufficient in production of grains, producing over 100% of domestic consumption of oats and barley and over 90% of wheat. Average yields over recent decades have been broadly stable but fluctuate from year to year as a result of better or worse weather. Increasingly unpredictable and extreme weather as a result of climate change is likely to exacerbate these fluctuations. Wheat yields in 2020 were the lowest since 1981 due to of unusually bad weather. However, preliminary data indicates they have since increased in 2021.
> In meat, milk, and eggs, the UK produces roughly equivalent volume to what it consumes. In 2020 it produced 61kg of meat, 227L of milk and 172 eggs per person per year. By value, the UK is a net importer of dairy and beef. This reflects UK consumer preferences for eating higher value products, while lower value products are exported.
> The UK produces a significant proportion of its other crop needs, including around 60% of sugar beet, 70% of potatoes and 80% of oilseeds. Apart from a recent pest-related reduction in oilseeds, these proportions have remained stable over the last ten years. Climate change represents a risk to production both in terms of making conditions unsuitable for some crops and allowing new pests to proliferate but it may also benefit new types of crops.
> The UK produces over 50% of vegetables consumed domestically, but only 16% of fruit. 93% of domestic consumption of fresh vegetables was fulfilled by domestic and European production, while fruit supply is more widely spread across the EU, Africa, the Americas, and the UK.
https://www.gov.uk/government/statistics/united-kingdom-food...
Electricity prices have sky rocketed in most of Europe.
[1] https://www.gov.uk/government/statistics/united-kingdom-food...
> This is unjustified. Under no circumstances could this happen unless a) price gauging, or b) supply chain is drying up.
Are you aware that both Russia and Ukraine are (normally) major exporters of grain?
> The UK is largely self-sufficient in production of grains, producing over 100% of domestic consumption of oats and barley and over 90% of wheat. Average yields over recent decades have been broadly stable but fluctuate from year to year as a result of better or worse weather. Increasingly unpredictable and extreme weather as a result of climate change is likely to exacerbate these fluctuations. Wheat yields in 2020 were the lowest since 1981 due to of unusually bad weather. However, preliminary data indicates they have since increased in 2021.
> The UK produces a significant proportion of its other crop needs, including around 60% of sugar beet, 70% of potatoes and 80% of oilseeds. Apart from a recent pest-related reduction in oilseeds, these proportions have remained stable over the last ten years. Climate change represents a risk to production both in terms of making conditions unsuitable for some crops and allowing new pests to proliferate but it may also benefit new types of crops.
> The UK produces over 50% of vegetables consumed domestically, but only 16% of fruit. 93% of domestic consumption of fresh vegetables was fulfilled by domestic and European production, while fruit supply is more widely spread across the EU, Africa, the Americas, and the UK.
https://www.gov.uk/government/statistics/united-kingdom-food...
https://www.bls.gov/news.release/cpi.t02.htm
War has nothing to do with that, at least not war in a classical sense. Economic or total war that some countries are involved in can be considered as a major reason.
Once war started, the sanctions made sure they stayed high.
And Ukraine's hesitance/inability to strike war-relevant civilian targets in Russia (say, bridges and factories) more than very-sporadically makes the term a bit iffy even for them. Hell, even Russia's been more restrained than what the term usually suggests, as far as the brutality of attacks, if only barely.
https://en.wikipedia.org/wiki/Total_war
It basically means "complete mobilization of a state & society toward a war effort, coupled with a willingness to engage any target regarded as having any war relevance whatsoever, no matter where or what the target is". Hallmarks are mass conscription, rationing, large-scale conversion of civilian production capacity to making war materiel, and leveling cities on purpose (not just as a side-effect of fighting over them).
How do you figure? From the numbers posted by others in these comments it seems UK inflation is pretty much mid-table compared with the rest of Europe: https://i.redd.it/8hbhiqhowjpa1.png
I'm figuring this from the reporting of the BBC, Guardian etc
https://www.bbc.com/news/business-63596773
https://www.theguardian.com/business/2022/jul/02/dashboard-o...
You would be surprised, but German press is full of such stories.
0. https://tradingeconomics.com/germany/food-inflation#:~:text=....
1. https://www.google.com/amp/s/amp.dw.com/en/germany-inflation...
So, German groccery prices did a lot of catching up since at least a hear. Slow enough so that you don't realize unless you are living on tight budget. That being said, since salaries in Germany tend to be higher than in France, the average German consumer is still a bit better off (ignoring housing or rent, and using a broad brush here).
The war im Ukraine did caise all kinds of issues, as did Covid. All ghinhs considered so, the developed world did reasonably well so far so. If food prices increaseore so, governments will have to intervene, as lower income families will have a hard time between increased energy and food prices.
neither Covid19 nor the war caused the effects, it were the measures that the stupid monkey horde took.
Anecdotally, seems there's a lot of British and European expats here in the Valley and they don't seem too keen on returning. We've been getting a lot of international applicants (but work from home was supposed to mean Europeans could avoid moving to the "dangerous" US but work for American companies?).
Maybe best to sum things up as a run of bad luck compounded with gross incompetence?
Energy costs are the primary driving factors for the cost of nearly all aspects of modern life.
They are now no longer exporting, and many countries in the world are getting 50% or more of their calories from import. Things will get better before they get worse.
It's not like they wouldn't like to export when they could. But they are not allowed to export due to various sanctions and limitations. It's almost like one side taking half of the world as hostages and letting them hunger, so they could harm and blame the other side.
But yes, "Carthago delenda est" no matter the costs and victims.
:extreme sarcasm:
>The Edict on Maximum Prices is still the longest surviving piece of legislation from the period of the Tetrarchy. The Edict was criticized by Lactantius, a rhetorician from Nicomedia, who blamed the emperors for the inflation and told of fighting and bloodshed that erupted from price tampering.
>During the Crisis of the Third Century, Roman coinage had been greatly debased by the numerous emperors and usurpers who minted their own coins, using base metals to reduce the underlying metallic value of coins used to pay soldiers and public officials.
Hopefully the EU can be reformed to go back to a trading bloc, with a liberal visa regime for member states, rather than an idealistic United States of Europe model, punctuated periodically by brutal austerity.
Not quite sure why, but their relative productivity per worker has been dropping since 2007 compared to all other developed nations. [1]
With low productivity, it doesn't matter if you have sweet trade deals - you're still going to decline eventually.
[1]: https://www.bbc.com/news/business-47826195.amp
One, UK is growing at about the same rate as other developed economies. This is quite remarkable because, if you look at Europe, 100% of these countries have significantly higher unemployment.
Two, productivity growth has slowed everywhere after 2007. The UK is comparable to Western Europe, slower than Germany, faster than Italy, it depends heavily on what start and end date you pick. This isn't particularly surprising given that we essentially outlawed the most productive sector of our economy after 2007.
Three, the UK had no financial boom in the 2010s, the US did, and the EU did...let's just wait until the debt has to be repaid to see the full score on whether that has worked out economically.
Besides the obvious degradation of the energy and fertilizer markets from the war in Ukraine, the collapsed Pound is probably the biggest factor here.
As someone who occasionally orders stuff from UK businesses, I wish the pound would collapse against the Canadian dollar. Like, 1:1 or 1:1.2
Even for things that can be domestically produced, like greenhouse tomatoes, they will still be more expensive even if they are now competitive with imports. And for items like rice and couscous you're not really going to be able to domestically produce them anyway.
If I agree, I upvote and move on.
For example, in January, food inflation in France was 14.8% and in the UK it was slightly lower at 13.3% and the OECD rate was 15.2%. It's not a Brexit problem; it's a production problem.
- https://tradingeconomics.com/france/food-inflation
- https://www.theguardian.com/business/2023/jan/04/record-133-...
-https://www.ons.gov.uk/economy/inflationandpriceindices/arti...
The UK is one of the most import-dependent nations in europe, and the world; it's easy to give good reasons to suppose had the UK been in the EU it would have seen below-average inflation.
They can choose between the individual products they buy, so it wouldn't be a problem if just some food items got expensive. But the price of food overall is inflating.
A lot of the basic foodstuffs -- dry beans, grains, milk, eggs, flour -- have all gone up in price significantly. I've seen prices double over the last two years on some of these.
In fact, I believe that the price of hot dogs have gone up more than the price of steak has. Yet people are still buying more hot dogs and less steak.
It will happen.
And the inflation will push some people toward such food choices. Maybe not that extreme, but switching to cheaper food generally means eating less nutritious food (unless you were over-spending), which is awful.
Being pushed into single-digits spending on food daily isn't outside the realm of reality. £10 a day is about £305 a month. This is a lot of money for some vulnerable groups, like large single parent families, retirees, students, some young adults, and similar.
The inflation also harms people's diets in a several ways: you must buy less food or less nutritious food for the same amount of money, and you have less money for food as other expenses have inflated. What is worse, less healthy food demand has long-term consequences to do with its supply going down and prices going up further.
In Germany I'm able to buy 1kg of flour for about 50 euro cents at Edeka. I don't know how much bread that makes, but it is A LOT. I'm certain that it is significantly more than 2880 calories.
Still there are in-between options - pasta for instance is more bang for your buck than peanut butter and is much easier to prep yourself than bread.
Anyways, it was to argue a point. Most calorie-dense foods are unhealthy if eaten alone. Peanut-butter, and flour included.
If everybody starts eating even more trash than usual then that will cost the government more in healthcare costs.
Eating seasonal and preserved foods is how we survived before the age of refrigeration and global logistics chains and maybe we should reconsider what is normal.
That we survived doesn't mean we had a balanced diet.
I'm a senior programmer with outrageous salary, and I still paused yesterday looking at the price of beef. Went for chicken instead.
I wish inflation numbers would also include things like "percentage of income spent on just living: food and shelter"
If that also leads to meat being a side dish instead of the main dish more often that's probably for the better for overall population health too AFAIK.
That is a false binary. You can still buy flour (or naan or pita), cheese and tomato sauce instead of pre-made pizzas, sacrificing your time against rising food costs. You can buy lentils instead of steak, sacrificing your preferences against rising food costs. Or you can travel further to a warehouse store and buy in bulk...
When enough people act empowered in the face of adversity, we don't have to sweat "greedflation". Retailers will learn their lesson.
Yes, I understand rising prices make life worse. But don't let anyone tell you there's nothing you can do about it. Learn to cook, change stores, eat differently, maybe even move.
"My Pizza Pops went up 25%, I am powerless in the face of inflation!" Just no.
The exception is maybe if you've got a good Indian supermarket and can buy at the 10-20kg range, then churn out a lot of chapattis.
"Let them make cake"
Why does higher priced food keep inflating too if consumer has no control.
They could always eat cake.
Not sure how this would be relevant.
a) raw ingredients didn't go up in price either. They did: https://news.ycombinator.com/item?id=35291270
b) making food from raw ingredients is cheaper than buying (at least some of the ingredients) pre-made. Again, it isn't for a surprising number of foods because, you know, economies of scale. Prime example is bread.
Why do you think economies of scale wouldn't happen at the potato-selling business? Are they buying and selling individual potatoes?
It's easy to dismiss your opponent with "but rice and potatoes aren't more expensive". Well, I don't only eat rice and potatoes, and prices for other stuff like meat and milk has gone up.
Elastic demand is the opposite. Some products have elastic demand, like luxuries and durables. An expensive car trim might be very price-sensitive because it is a luxury product. People will buy much fewer of those in austere times. They may buy fewer washing machines, too, because these products are durables. They are often bought "as an upgrade" or when one broke but could be repaired for cheaper.
One could be temporarily elastic, e.g. thaw meats from the freezer, eat shelf-stable food from the pantry. And in a few weeks, prices could be different and they do tend to bounce around week to week.
Here we're discussing food... People have to eat so demand for food, at least staples, does not change much when prices rise as long as people can afford to pay (and by and large currently they can).
It should also be noted that in developed countries the price of food has collapsed as a proportion of people's income over the last 100 years. So the reality is that even if prices double demand will probably not change much apart from some arbitrages (go to cheaper brands/supermarkets, drop in demand of a few luxury items and non food items).
People in west vastly overestimate how much they have to eat.
We wouldn't have health epidemic if people can just stop eating all the time.
Last year that number was 3600 ( fda recommendation is 2000, for reference )
imagine what will happen to food prices if americans cut their consumption by half.
I fully expect one or both of those stores to be absorbed by the Safeway/Albertsons/Kroger monolith in the next few years.
In the UK where big business dominate, the competition is illusory and regulators turn the blind eye.
It doesn't seem like Labour has a charismatic leader either. I could never even find a concrete stance by Corbyn on what he was running on wrt Brexit.
HNers from UK, what does the outlook look like policy wise for the UK.
I'm hoping for boringly competent management of the economy plus a gradual drift back towards relatively friction free trade (both goods and services) with our largest neighbour.
Wage growth would be good and some action on housing so wage gains don't just turn into house price rises.
Sunak will gracefully lose the next election, by a lot, but a lot less than Truss or BJ would have lost it by, and having helped to slow the freefall in reputation by the Tories and steadied the economy a bit. Keir Starmer will be a decent and competent but dull leader for two terms, and the who the heck knows. But the next ten years or so should be pretty dull, in a good, centrist sort of way, ideally culminating in rejoining the EU.
Not optimistic for the next ten years or so.
In fact, local eggs are now cheaper than factory farm eggs around here, and chicken is getting to be equivalent in price to beef.
People might stop caring quite as much about individual pricing once they have enough money not to have to care.
People who have to worry "can I afford all of this once I get to the till" are very aware of how much everything costs, and they are more common than people who don't have to worry.
"Gallons" are not a universal metric:
For the US, 1 Liter of milk = 0.2641720524 (US) Gallons.
For the UK, 1 Liter of milk = 0.2199692483 (UK) Gallons.
Because this has been and still is confusing, the standard unit of liter was introduced as a universal alternative (no flamebait intended).
If you are poor and/or live paycheck to paycheck (for example due to your monthly home heating bills having gone from 400 euros to 3000 euros year over year), I can guarantee you, you pay very close attention to how much food costs.
I doubt it. I've read that Americans throw away 40% of their food. Obesity rates suggest people eat far more than they need to. And there are major choices in what to eat - cheap vs expensive calories.
Obesity rates are also higher among poorer segments of society than wealthy, so it isn't necessarily a given that obese people will choose to eat less just because doing so will make them poorer due to higher prices.
But that's not popular to talk about; nobody likes hearing about personal responsibility anymore.
Friends in the US drove school buses during the day and worked at Wendy's at night, only to give back a substantial part of what they earned to Wendy's to cover their dinner there. They didn't even realize what slavery they were caught up in.
I hear that a lot, and it simply isn't true. A bag of apples is cheap, so is a bag of beans, a bag of rice, a bag of potatoes, etc.
Some of the cheapest foods in the supermarket are an ordinary can of beans. Milk is cheap, too.
It is possible to lose weight eating only at McDonald's but it takes effort.
The fact that Americans drink about 40 gallons of soda a year on average HAS NOTHING TO DO WITH ANYTHING GO AWAY.
(I'd love to do the math if all caloric sodas in the USA had corn syrup removed and fake sugars added what the result would be)
How much is 40 gallons? 426 12 oz cans of soda, 35.5 dozen cans, or 256 20oz bottles of soda.
I wonder if the bad quality of the majority of tap water has an effect on soda consumption. How much less soda would we drink if every residence had on-site water filtration?
That's a complete lie. It's way cheaper to purchase healthy ingredients and cook than to get fast food. It's completely cultural.
If humans behave rationally and eating healthy is cheaper and healthier why don’t more people do it?
It's a matter of culture.
There are currently competing narratives in the UK about food prices - greedy supermarkets v poor farmers and the same people complaining then say they shop at Aldi because it's cheaper.
Food is still cheap - it represents a small percentage of people's income. However, in the UK, we are beginning to see that food produced without the benefit of slave labour is somewhat less cheaper than it used to be.
If you look at it as an average for the population, sure. But that masks the real issue, which is that it hits poor people the hardest because spending on food doesn't scale proportionally with income.
Sure, the distributors are different, but I'd assume it's all still Monsanto, Unilever, etc., at the end of the day anyway.
130 basepoints if you use GAAP measures so only ~7% higher margin then but clearly unilever doesn't just have higher costs but is also increasing their margin.
Here's wholesale food prices in the US: https://fred.stlouisfed.org/series/WPU578101
In fact you'd expect reduced sales from the higher prices to put pressure on profits. That is what seems to be happening in the UK:
https://www.grocerygazette.co.uk/2023/01/31/food-companies-p...
But not in the US, where it does look like there may be some gouging going on, but we'd need to see their profit reporting to be sure:
https://accountable.us/wp-content/uploads/2023/02/2023-02-10...
Should we be concerned about why there are shifts in demand/supply? Sure.(In the case of food, part of this is driven by the UA war and likely other trends in food productive)?
But it is eminently unhelpful to simply attribute increases to 'gouging' and expect that to be the final say.
The other factor is that rising prices often mean an increased need for investment by producers. That investment capital has to come from somewhere, so what look like increased profits based on current cost structures can actually be entirely justified if the company then needs to invest that money in order to get production volumes up and cope with increased capital costs.
I don't know enough about the food industry to be able to say which of these is happening, in which sector or country, but these are much more complex issues that the knee jerk reactions here imply. What I can say is, it seems to me that if the reduced supply from Ukraine and Russia is going to be made up, somebody somewhere is gong to have to ramp up food production an awful lot, and I can't imagine that's going to be cheap.
Considering that's the explicit context of this comment thread, obviously, the difference is exactly what we're talking about here.
> I don't know enough about the food industry to be able to say which of these is happening, in which sector or country, but these are much more complex issues that the knee jerk reactions here imply.
That's what I mean about sparing a company's feelings. You have no material objections, but it's important we not use the word "gouging" for companies whose profits are rising considerably faster than inflation and it's consumers being hurt. Tone policing is the least important (and least interesting) part of this conversation.
Price is a signal of scarcity. Food is more scarce due to supply chain issues, therefore food is more expensive. Is that bad? Sure, let's address the supply chain issues, overall macroeconomic inflation and, uh, other disruptions (incl. the UA war).
Unless you are specifically alleging direct conspiracy between food producers to raise prices (e.g., monopolistic action), (also already an illegal thing), there doesn't seem to be a clear call to action here.
if any given step in the value chain is increasing their prices beyond what is necessary to cover increases in costs (they are), that additional margin purely for the purpose of wanting more money is, imo, pretty shameless when it's hurting so many people down the line
and i don’t think you’d expect it to. the increased supply needs to hit the market first. depending on how that money is distributed, that could take a long time. also remember that QE has been central fiscal policy in the UK and US since basically 2007. and it’s safe to say that concentration of this wealth is.. very high.
> has UK M2 declining [..]
it becomes a bit more sobering when you look at the full scale on that graph (when the y-axis starts from 0). it’s a metaphorical deck-chair-thrown-off-of-the-titanic amount of decrease.
Yes we have high inflation now, but that’s just been a plain old cockup. The massive inflation reduction act stimulus for example.
The profits are inarguable. They really have never been higher. https://tradingeconomics.com/united-kingdom/corporate-profit...
(note the table underneath pointing out that industrial production has declined at the same time as record profits)
Energy is a large part of that: https://www.bbc.co.uk/news/uk-64489147
This feels correct, but if that were the case, if companies are generating record profits, why aren't we seeing that reflected in stock prices? At the very least, why isn't price / earning ratios cratering?
What are profits like adjusted for inflation?
they only need to increase prices to deal with the increase in costs, and profits represent an increase above and beyond that necessary amount, which in economic terms is "not cool, dude"
The root cause is economic decoupling between Russia, China, and the U.S.
The main change has been energy prices (it is complex because supermarkets stopped selling some products, so the price recorded is not what consumers experienced because the product largely wasn't available).
Also, just generally, that isn't how demand for food works either. It isn't elastic, there are substitutes for every product. The main factor driving differences between countries is usually the structure of the food supply chain and exposure to trade.
Couscous and margarine and eggs being more expensive across the board at the supplier level. This does not speak to any sort of cartel behavior.
There are quite a few significant supply bottlenecks in the U.K. food supply chain, from supermarkets to wholesalers to importers, and they do allow for price fixing - demonstrably so in the case of supermarkets and domestic produce.
Also with a "big evil" you can tell yourself that removing that evil would solve everything.
I use housing as a good example since it's been a major driver of inflation and most houses are sold peer to peer on the open market. If you're selling your house and you see comparable houses selling for $900K, but you only need $750K to earn enough profit to buy your next house, what are you going to do? Sell for the lowest price you can afford? Or sell for the highest price you can get? You'd sell for the highest price. And that same calculation gets played out at every level of every transaction in every corner of the global marketplace. Yet nobody would think of themselves as being a villain for doing it. Or be accused of gouging.
The house sale is a perfect example, and is something to meditate on. (One solution is 'competition' such as making sure new houses are being built, other companies can produce food, etc.)
When a store runs out of flour, people don't get as mad at the store as if they raised the prices but keeps flour on the shelf. Despite the fact that having an expensive option for flour always leaves you better off than having no option.
After Hurricane Katrina there were some prominent examples of people being arrested under anti-scalping laws for trying to haul in food and generators from other areas to sell.
Companies are smart. When news gets spread far and wide about a shortage of eggs or other products due to disease or wars or "supply chain issues", they leap to take advantage of this consumer consciousness by increasing their prices, knowing the consumer will blame the larger macro factor and not the company. This has been well-documented, even in cases where the supply chain issues didn't actually impact the company that raised prices.
The best way to understand what's happening is via corporate earnings calls. They're upfront with their strategy when talking to investors.
For more info I'd recommend listening to this episode: https://www.bloomberg.com/news/articles/2023-03-09/corporate...
I don't deny that corporations will try to make a buck taking advantage of favorable price-over-volume plays when they can, but I think it's crazy that people think during a global energy and fertilizer shortage Walmart just decided to throw out all of their low-price volume corporate strategy just to screw customers over egg prices.
I'd expect decent firms to not try to gouge customers who are already hurting at the time when they most are, but maybe "normal" means "sociopathic" in the context of amoral unrestricted capitalism
Even drug dealers aren't that greedy
Why did companies wait until this year to do that?
This certainly seems to be more of a sign of a weakening pound not buying as much in n imports than something about food alone.
Week ending 2023-01-18: 748,000 birds affected in Ontario, 7,051,000 in Canada [1]
Week ending 2023-03-22: 749,000 birds affected in Ontario, 7,173,000 in Canada [2]
[1] https://web.archive.org/web/20230120170319/https://inspectio...
[2] https://inspection.canada.ca/animal-health/terrestrial-anima...
https://i.redd.it/8hbhiqhowjpa1.png
Can't be that one has tech or purchasing power that the other doesn't, or that food needs to travel a lot further, and I would also not expect vastly different foreign relations (also because EU, but also because the countries are so similar in beliefs and histories).
And similar for slightly different but still nearby and similar countries like Germany, Luxemburg, and the UK. Anyone know what causes these differences?
Edit: to answer your question, I wouldn't look for meaning behind that but rather assume that a limited scope article is a lot easier to write than a broadly scoped one. In the ~global context of HN, the headline then sounds like they're singled out.
Or, in a word, Brexit.
Everywhere is getting inflation. Supply chain disruption, Ukraine war and a dash of climate change (hasn't really bitten yet compared to the other two). Britain seems to be getting about 5% more than everywhere else.
Not sure why but generally journos seem to write about issues like they are only hitting the UK when a simple google search shows they aren’t.
It does come across like a weird concerted effort to paint the UK as collapsing since leaving the EU. The majority of journos seem to be able to write only negatively about UK current affairs unless you read something like The Express who are delusional in their own right.
Most recent ones I can think of are the failed space launch and British volt going under.
These were both highly ambitious projects that had a high chance of failure, especially the space launch. It’s unlikely you’re going to get your first launch right, famously it takes many attempts.
When both of these happened journalists seemed to revel in the failure. It was very odd to see.
I understand with these two examples a lot of it has to do with government/brexiteer chest thumping which shon a spotlight on them. However it was still odd to see.
I think this then trickles down to places like HN (who’s membership generally has a bias towards remain) who also see an opportunity to revel in it.
This is odd as well because I can see why Britons or Europeans would be passionate about membership in a regional trade bloc, Americans who get really passionate about it confuse me. As a Briton I didn’t really care when America left NAFTA.
This is assuming the majority of people on HN are American but based on time zones and when articles are posted I’m probably wrong.
Edit:
This is a UK based publication writing about Groceries in the UK which is why it’s so specific. Your comment just spurred something I’ve been thinking recently.
Especially on Hacker News. I tend to avoid UK-based posts on here because the content is fairly predictable: the UK is going to shit and Brexit is to blame, repeated ad nauseam in the absence of any evidence that it's true. If I wanted thoughtless UK doom mongering, I'd read the Guardian or the NYT.
UK announcing research into x: comments will probably be negative and about how it’s a boondoggle.
UK company doing exciting stuff like fusion or quantum: comments will probably be negative and about how it’s a boondoggle.
It’s tiring.
Edit:
That being said it does lead to hilarious moments where I’ll read the Guardian and see a headline like “The NHS won’t make it to Christmas (for real this time) but it doesn’t matter because we’ll all be dead by then because of Brexit” and then I’ll see the Express in my corner shop with a headline like “Brexit HERO Boris makes Ursula von der Leyen CRY when he announced new BRITISH MOON BASE”
Actually what I'm describing is casualuk which is even wore for its banality some how.
If i needed a teenager to verbally doom scroll me i'd talk to my extended family.
- Governemtn forecast 4% lower GDP than without Brexit
- UK car industry significant decline in output since 2015 (around 30% IIRC)
- People who immigrated here for work (and have the right to stay) are choosing to leave
- Low investment compared to comparable regions / countries
- Turmoil around NI
- Banking migrating to Europe and New York in particular
- Trade deals not materialising
It’s not what “project fear” warned us of, but it’s certainly not good. Many of these effects are playing out across years so haven’t really hit home for people yet.
Are you being facetious ;)
It's because there are narratives to follow, sides to pick. There's no room for facts by themselves, they have to fit some story your pack has bought into.
Right, left, middle, or anarchy, it's all the same; you're part of a herd.
Obviously we are going through a tough time at the moment. While there are some things unique to the UK (such as the nurses and junior doctors strike), for the most part what we are experiencing is common to most of Europe and often even the USA. I mean look at France - Paris is drowning in rubbish due to bin strikes and protesters are setting things on fire - yet if anything that seems to be being covered as something positive for them. People taking back power and exerting their rights. Last time that happened here, though, it was treated as an almost apocalyptic event and emblemic of Broken Britain. Sure the Paris strikes are ostensibly about pensions, but really they're about more than that.
By default, Brits tend to lean toward the negative side. I think even before Brexit/Tories/etc. most British people would broadly have considered the UK to be a bit shit, and generally complain more than they say anything positive. However, when measured, the UK is in the top 10 countries on a huge number of metrics and isn't particulary awful at anything. I do find the general negativity a bit tiresome, but it's not entirely a bad thing. That negativity is probably partly behind why we have managed to become and remain such a successful and stable country for so long.
Online, though, British people seem to be incredibly negative in a way that I've rarely experienced in person. I figure one reason why people online are so unflinchingly negative about the UK is that online Brits seem to lean very hard left and we're now on our 13th year of Tory leadership. I'm pretty lefty myself, but an awful lot of the chronically online UK types are literally Trots and Tankies (who are, nevertheless, pro-remain #FBPE, despite the contradiction between those views). Look at, e.g. Corbyn's online popularity versus his real (un)popularity with the electoral base. Or how the Tories actually generally get a similar popular vote to Labour, but online it's hard to find a single person who expresses any support for them.
I also think the UK generally gets its news about Europe from US news sources, especially when it comes to economic policy and comparisons. The US news (especially NYT and such) love to paint the US as a capitalist hellscape compared to the utopia of Continental Europe and the Nordics in particular. In reality, of course, the EU and Nordics are a lot more complicated than that, and in socioeconomic terms we're a lot closer to Europe in most ways than we are to the US, but that doesn't seem to feed through so people draw the same comparisons that are popular in US papers. You also get that with the NHS vs USA's system, as though those are the only two options.
Most news sites have become rather terrible since they started optimizing solely for ad revenue.
It's for clicks. It's completely disingenuous and one should be wise to take a mental note of the author and publisher.
To answer your question: "Not sure why the UK is being singled out."
The answer to me is simply that it is a UK website www.grocerygazette.co.uk
There are plenty of similar stories about the same kind of inflation here in France such as https://www.lemonde.fr/en/economy/article/2023/02/03/inflati... or https://www.france24.com/en/france/20230306-french-retailers...
With Hacker News being predominately English speaking I suspect plays into why we see more US and UK (and other English speaking countries) related posts vs non-English speaking.
And of course people do love to point out where the UK is suffering these days to put a Brexit spin on it (whether fair or not) as it gets them clicks. Much like a famous or young person dying is almost always reported as "died suddenly" these days regardless of nature of death as it gets clicks with all the anti-vax crowd.
The UK is being singled out because its not able to import the groceries it used to do before Brexit now - there has been a low yield crop season in most parts of Europe and the domestic demand for groceries has literally exhausted the supply that can be exported. Since the UK is out of the Eu, its not possible to access the Eu domestic supply anymore and it has to wait for what remains for export.
https://www.cnbc.com/2023/02/28/british-supermarkets-are-rat...
There isnt such a situation like rationing vegetables anywhere else in Europe.
All I know is that here in the Netherlands, the prices they're mentioning are normal.
https://ycharts.com/indicators/europe_inflation_rate
That isn't true at all, the UK is about the same as the Euro area taken as a whole.
> Since the UK is out of the Eu, its not possible to access the Eu domestic supply anymore and it has to wait for what remains for export
The UK is absolutely capable of tapping EU supply, we've got an extensive free trade deal. I'm eating Spanish cherry tomatoes as I type!
Source: https://tradingeconomics.com/country-list/food-inflation?con...
https://ycharts.com/indicators/europe_inflation_rate
> The UK is absolutely capable of tapping EU supply,
I don't understand what are you trying to falsify. CNBC or their news about the UK not being able to import as it used to from the Eu.
"...James Walton, chief economist at the Institute of Grocery Distribution, told CNBC: “The U.K. is highly reliant on imports of fresh produce at all times of year, especially in winter — the EU accounts for much of this import volume. If there are shortfalls in production in the EU, then it would make sense that EU producers would serve their local demand first. This leaves less available for export to the U.K...”"
Having a 'free' trade deal does not mean that you will get priority over the domestic buyer as an outsider.
> I'm eating Spanish cherry tomatoes as I type
Your personal experience does not constitute a statistic.
You said the UK, due to Brexit:
> Since the UK is out of the Eu, its not possible to access the Eu domestic supply anymore
Which is just plain not true. Deprioritised, sure, but not unable. A lot of people take the Daily Mail seriously (including other news outlets too) when they say stuff like we can't get tomatoes. It just meant I went to the other shop across the road instead.
The difference apparently is in how much the inflation affects different basket items. Like food.
> Deprioritised
Yeah, that means 'unable' when there is a shortage like how there is just now.
> A lot of people take the Daily Mail seriously (including other news outlets too) when they say stuff like we can't get tomatoes
CNBC is not daily mail.
https://ycharts.com/indicators/europe_inflation_rate
General inflation: UK 10.4% vs EU 9.9%
Food inflation: UK 18.2% vs EU 19.5%
Same reason I can't say UK inflation is 10.4% and much lower than the EU's 19.5%. They're measuring different things.
Even we gloss over it and trust the UK's own numbers, the Eu inflation in February would have been driven by mostly Germany with ~24% inflation compared to the ~10% most of the major countries have.
...
However it still does not make any difference since prices are irrelevant if there simply arent groceries and they are being rationed. That was the point.
Either food inflation or general inflation, the UK has similar rates to the rest of Europe.
The Tories are not in charge of deciding the inflation rate in the UK, it's from the Office for National Statistics and all the financial lenders would be very quick to voice their disagreement if they thought otherwise. Suggesting that the values coming from the UK are fake is an extraordinary claim which you have no evidence of.
Germany has a general inflation rate of 8.7%, this is below the EU average. They are not driving it up.
Groceries were rationed because UK supermarkets refused to buy them at spot-prices. The UK had a shortage of peppers while Sweden etc had peppers at 10€/kg.
Yeah, and that's a Japanese institution not British. Its incorrigible like the BBC...
> Suggesting that the values coming from the UK are fake is an extraordinary claim
Its as extraordinary as other claims like Iraqi WMDs or the GDP numbers generated from 'homeowners creating and using rent services'.
The trust of Brits in their institutions is amazing.
> Groceries were rationed because UK supermarkets refused to buy them at spot-prices
Surely not because of Brexit... It has to be something else.
Source: live in UK
I wouldn't be surprised if those countries such as Spain reduced the amount available for export so that they can meet demand for local markets though, but capitalism would dictate that they sell to the highest bidder instead.
Companies LOVE an excuse to raise prices to where they "think" they should be, and inflation is a great time to do such.
Hmm...
Yeah, okay, whatever.
0. https://www.economist.com/britain/2023/03/02/britains-tomato...