A little inflation

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tmiles
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2013/08/06 16:46:07 (permalink)

A little inflation

Yesterday I stopped at Howard's on Rt 9 in West Brookfield , Mass. I got a  nice , soft serv, hot fudge sundae. I was a little surprised when the serving girl asked for $6.32. The place has been in biz for years, and is very popular. They must need to get that kind of money to stay in business. I stop there a few times a year, and will return again. What does a garden variety sundae cost in your area? Are you in a "high rent" area?
post edited by tmiles - 2013/08/06 16:47:45
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    Morel
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    Re:A little inflation 2013/08/06 18:22:19 (permalink)
    i live in a small.town south of toledo so definately not what i would consider high-rent
    #2
    Morel
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    Re:A little inflation 2013/08/06 18:24:00 (permalink)
    accidental premature posting, a sundae here is about $3.00 for soft serve and about $4 for hand dipped
    #3
    Pancho
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    Re:A little inflation 2013/08/06 18:34:28 (permalink)
    Here at a local frozen custard chain, a medium turtle sundae is about $6. Seniors get 10% off ONLY if you ask. I got mad the other day when I ordered a root beer float and the only spoon provided was a regular tea spoon length plastic. I even called the owner later and he said they "were cutting costs". They just cut a customer instead.
    #4
    MetroplexJim
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    Re:A little inflation 2013/08/06 19:10:12 (permalink)
    This is $3.50 in McKinney,TX:  http://www.culvers.com/menu-and-nutrition/sundaes/menu-item-details/caramel-cashew-2-scoop/ 
     
    That said, "next door" in Frisco, TX this place has prices every bit as high as those in MA:  http://www.doubledipfrozencustard.com/ .  The last time we went by we went in, took a look at their prices, and went on.
      
     
    post edited by MetroplexJim - 2013/08/06 19:11:40
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    Michael Hoffman
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    Re:A little inflation 2013/08/06 19:17:11 (permalink)
    I've never had anything soft serve, but when did a hot fudge sundae price go up from 25 cents? Sheesh! Next you're going to tell me a banana split doesn't cost 35 cents any longer.
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    MetroplexJim
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    Re:A little inflation 2013/08/06 19:54:00 (permalink)
    Michael Hoffman

    I've never had anything soft serve, but when did a hot fudge sundae price go up from 25 cents? Sheesh! Next you're going to tell me a banana split doesn't cost 35 cents any longer.


    Actually, if the Consumer Price Index actually was what the Bureau of Labor Statistics says that it is, a hot fudge sundae probably would be a quarter! 
     
    With regard to the "redefined" government statistics these days I am reminded by one of my favorite sayings:  "It's bad enough that you are pi$$ing on my shoes, just don't try to convice me that it's raining"!
    post edited by MetroplexJim - 2013/09/24 07:31:27
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    tmiles
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    Re:A little inflation 2013/09/23 19:20:48 (permalink)
    Update...
    Today I was in the area again. Within a few miles of Howard's is The Clambox, part of a 5 or 6 store chain (not related to the Clambox in Ipswich). The Sundae of the Day is 1.99, and a real deal. The whole clam roll was a 10 out of 10 and 9.99 on this Monday, usually 13.99 and worth every penny. I came with fries and was served on a "footlong" buttered hotdog bun.  They were doing a good biz for noon on a Monday, and I expect that's the idea. 
    #8
    MetroplexJim
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    Re:A little inflation 2013/09/24 08:07:39 (permalink)
    As an economist by trade, please know that the (economic and dictionary) definition of "inflation" begins as an increase in the supply of money relative to the real goods and services available in an economy.  The result of this "inflation" of the money supply is an increase in prices as "too much money chases too few goods".
     
    This last week the big economic news was the Federal Reserve Bank announcing that it would not "taper off" their "qualtitative easing" program of purchasing U.S. Treasury debt by creating - literally out of thin air - $85 billion per month in new reserves for the banking system.
     
    Please understand that each and every dollar "created" in this is now out there competing in the goods & services markets with the dollars you have earned. 
     
    Whether this is "good" or "bad" I'll leave to you.  Just know that it "is".
     
    Here is what John Maynard Keynes had to say about this process:
     
    "The best way to destroy the capitalist system is to debauch the currency. By a
    continuing process of inflation, governments can confiscate, secretly and
    unobserved, an important part of the wealth of their citizens". 

    post edited by MetroplexJim - 2013/09/24 08:09:04
    #9
    easydoesit
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    Re:A little inflation 2013/09/24 12:50:22 (permalink)
    MetroplexJim,
    Just want to say I enjoy your sporadic forays into economic principle.  I am a big believer in fiscal restraint and financial responsibility, and a fan of Milton Friedman.
     
    Keep up with the remarks as the mood takes you -- I just hope they don't get deemed "political" and get censored.
     
    Reasonable people can disagree, and do it respectfully.
     
    #10
    MetroplexJim
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    Re:A little inflation 2013/09/24 14:39:43 (permalink)
    easydoesit

    I just hope they don't get deemed "political" and get censored.


     
    That is why I stuck to a universally accepted economic principle, then said:  "Whether this is "good" or "bad" I'll leave to you.  Just know that it 'is'. "
     
    easydoesit
     
    Reasonable people can disagree, and do it respectfully.



    Indeed. 
    Hayek and Keynes were close friends. 
    You should enjoy these; my students certainly do:
     

     

    #11
    tmiles
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    Re:A little inflation 2013/09/26 19:59:31 (permalink)
    Jim is right. I moved off topic, even though I started the thread. I ran out of time on my last post and didn't get to the point.........but being waylayed by some great clams was good.
     
    When I bought my clams, I noticed that all plates we increased by a buck. Most had been 7.99, but the 7s were changed to 8s in a way that showed the old price. It was a protest and hard to do to good customers on the off season. The lady said, "I want people to do the math.......a buck on an 8 dollar meal is not the 2% they talk about on the news".
    #12
    phlmaestro
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    Re:A little inflation 2013/09/26 20:21:11 (permalink)
    When my wife and I lived within walking distance of Philadelphia's historic district, we loved going to Franklin Fountain, which has great ice cream that they make and some excellent homemade toppings as well. But they are in a very high rent area and their prices reflect that, which kept it to an occasional treat for us. A number of their sundaes run into double-digit dollars.
     
    Here is their menu:  http://www.franklinfounta...enu_2013_revised-1.pdf
     
    If you aren't too turned off by the prices, I really do recommend the place though if you're checking out the Liberty Bell, Independence Hall, and the rest of the stuff in that area. Aside from the quality, they do a good job of trying to capture the atmosphere of an early 20th century ice cream shop. The brothers who own the place go all out with their appearance in terms of looking like they belong in that era; right down to handle-bar mustaches.
    #13
    tmiles
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    Re:A little inflation 2014/02/01 08:44:04 (permalink)
    At a local dollar store, in the Auburn Mall (Mass), all items are now $1.09.
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    MetroplexJim
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    Re:A little inflation 2014/02/01 11:39:35 (permalink)
    Then married to a native of Bolivia I visited her home country twice: 08/1979 and 12/1984.
     
    On my first visit in 1979 the $b100 note cost $20 as the Bolivian Peso/USD was 5:1.  
      
    When I got off the plane just before Christmas, 1984 the $100,000 note cost $5 as the $b/USD rate had become 20,000:1.  I found the $b100 note below, only five years before worth $20, blowing in the streets of Cochabamba! 
     
    As I boarded the plane for home just after New Years 1985, the 'value' of the $b100,000 note had fallen to $2 as the exchange rate skied to from 20,000 to 50,000:1 in only two weeks!!!
     
    Several months later my father-in-law sent me a few $b10,000,000 notes.  The envelope he sent them in had two $b1,000,000 stamps on it!
     

     
    Actually living through a hyperinflation was a 'lifetime experience' for me as an economist.  Of course I knew the 'why' and the 'how', but the really instructive part was to see how the natives coped with this catastrophe.
     
    For them it was simple:  don't hold the domestic currency for any longer than you had to; consequently, the mershants and the wise would convert their Pesos into U.S. Dollars twice a day - once before the afternooon siesta and again at close of business.  As they said at the time:  "Never sleep with the Peso".
     
    Fortunately for them the United States Dollar was available to become an emergency substitute medium of exchange that made specialization and commerce still possible despite the egregious profligacy and miscreance of their government which has become addicted to 'quantitative easing'.
     
    Which begs a question - what happens to us if our Dollar should ever fail?
     
    The present market rate of exchange (with the Dollar acting as a medium of that exchange) is five minutes of economics lecture for a one pound rib-eye. 
     
    Should the dollar fail I guess I would be left to find a butcher who wants a five minute chat about economics.  Anyone care to wish me luck in that endeavor?
     
    Beyond that: 
     
     
    post edited by MetroplexJim - 2014/02/01 12:04:38
    #15
    EdSails
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    Re:A little inflation 2014/02/01 14:18:42 (permalink)
    Inflation has been hurting a lot of businesses. Philippes in LA even had to raise the price of their coffee to 45 cents!
     
    " />
    post edited by EdSails - 2014/02/01 14:20:03
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    MetroplexJim
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    Re:A little inflation 2014/02/01 16:00:29 (permalink)
    Hmmmm ...
     
    Seems my post about Bolivian inflation was timely.  Here goes Argentina, AGAIN! 
     
    Yikes!
     
    My favorite winter vacation is Rio.  Been there five times and used three different currencies:  the Cruzerio, the Cruzado, and the Real.
     
    BTW:  Any citizen of these countries (Bolivia, Argentina, Brasil) who was so foolish as to have had their savings in the local currencies had them totally wiped out by a torrent of inflation. 
     
    And, further, the political elites come out of these episodes in great shape having, prior to the implementation of their redistributionist schemes designed to perpetuate their power, salted away their wealth overseas, denominated in Swiss Francs.
     
    And it's such a shame.  Many of you will be " />shocked" /> to know that, early in the 20th. Century, Argentina had a larger GDP than either Germany or France.  Bolivia has the world's largest reserves of silver, tin, and lithium.  Brasil has oil reserves greater than Saudi Arabia, but that is just a drop in the bucket of what lies underneath it. 
     
    That whole region fills me with the same sense of sadness and loss I have when seeing a great athlete or a promising scientist succumb to alcohol or substance abuse. 
     
     
    post edited by MetroplexJim - 2014/02/01 16:02:24
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    tmiles
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    Re:A little inflation 2014/02/01 16:57:11 (permalink)
    ....and those who care laugh at the joke, "Brazil is turning into Argentina, and Argentina is turning into Venezuela..."
     
    Argentina came out of WW 1 the richest country in the world. Almost 100 years of bad government has turned this resource rich country into a mess. "Don't cry for me Argentina" was a good song, but we should in fact cry for Argentina, (not it's terrible leaders) and learn a lesson from the terrible leaders who ruined the country. 
    post edited by tmiles - 2014/02/01 17:02:43
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    Davydd
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    Re:A little inflation 2014/02/01 17:11:00 (permalink)
    We went to Bolivia in 2006. Everything was incredibly cheap. The exchange rate was about 8:1. A excellent bottle of wine was less than $2 and an Argentine steak meal at a good restaurant was about $3-4. We stayed in the best hotel in Cochabamba. We had the suite on the top floor and we paid for our kids' rooms (2 more rooms). The total bill for the week came to just a little over $500. What was expensive was gasoline. I figured out a US gallon of gasoline ran about $12. Every vehicle we rode in, taxis and buses ran on natural gas.
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    MetroplexJim
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    Re:A little inflation 2014/02/01 17:51:20 (permalink)
    Davydd, Bolivia has an abundance of natural gas but no oil.  The primary source of revenue to the government is from import duties which on some goods (like gasolene) run > 100%.
     
    When we last visited Cochabamba I got the worst sunburn of my life sitting by the pool at Gran Hotel Cochabamba.  Seems I forgot how strong the sun can be at 9,000'!  During the hyperinflation I described above I bough steak dinner for 8.  The bill was $12.  Leaving a 100% tip was a 'no brainer'; felt like a rock star!  
     
    Some of the more lasting memories were gotten on my visit to the Heladorera (sp.?), the ice cream shop on El Prado.  At less than a nickel a scoop, it merited a daily visit.  And, as it was in a safe neighborhood I changed my money there on the corner for my daily needs.  It was there I had a chance to speak with the merchants about how they were dealing with the hyperinflation. 
     
    Also, I had a good time there talking with the young Mormon gentlemen who always gathered there looking a bit lost on their Missions.  Great kids.  I wish we Presbyterians had the sense to send our youth off on a Mission; such an activity is a great builder of character.  
     
    And then there were the saltenas, but we've shared about that elsewhere on these pages.
    post edited by MetroplexJim - 2014/02/01 17:56:57
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