The unfortunate truth about inflation… 📈💵
In this monologue, Dan Novaes argues that the recent slowdown in headline inflation does not mean that inflation has ended. He explains that price levels surged two years ago and have largely remained at those elevated levels—citing examples like a $5 coffee, doubled rent, and unchanged grocery prices. Novaes emphasizes that inflation is asymmetric: prices rise quickly but rarely fall, because firms have learned they can charge more and are unwilling to lower prices even when inflation eases. Meanwhile, wages have not kept pace with these higher costs, so consumers’ real purchasing power has declined. The result is that people feel poorer despite nominally stable incomes, a phenomenon he attributes to a permanent shift in the cost of living rather than a genuine economic recovery.
Chapters
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