During Hyperinflation, How is the Public Made Aware of Lost Purchasing Power so Quickly?
In: Economics
Most people are well aware of the prices they pay for frequently bought items: Bread, a pound of hamburger, a gallon of milk, gas prices, etc. These frequently bought items are also the ones that tend to go up the most quickly during an inflationary period because these are things people need. If the price of a Fender Standard Electric Guitar goes up by 30% in a six month period and I’ve had my eye on one, I’d likely decide I don’t need it. (Supply and demand, keeps the price from raising too quickly). But I can’t decide that I don’t need a gallon of gas or a loaf of bread if I’m trying to get to and from work and if I have a family to feed. I’m going to buy those things, no matter the price. But I will notice them. Not only that, but if my whole grocery bill increases by 10% over a few months and if my gas increases similarly and the same with other items I purchase, then I’m going to have to economize somewhere. My budget won’t allow me to continue to buy everything I’ve been buying.
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