Hyperinflation starting? What's happening in your area? Post your ground reports.

[EmotionEngine]

It's interesting to see how prices are raised. At a local store that I shop at, I know the normal price of things. Now the normal prices are "sale" prices, with a higher price behind it. Apparently they want to condition people to think the new higher price is "normal".

Bingo. New price and then sudden sale. I thought, "they are trying to soften me..."

 

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[GPM]

I hope you’re not putting that in your body

Lol no. I just happened to walk down the isle. That price is about 2-3x what it was not too long ago. The price of Canola has just about 4x lately. Which is odd, there is literally field and field after field of Canola plants not too far from where I live.

 

[Patryk.]

I often buy nuts. Recently, I was wondering how the stores can maintain the same price of nuts for a period of more than two years. It is imposible because you will lose all the profit through the inflation. I couldn't figured that out so I was just happy I can buy the same amount of nuts in the same price - like everyone else would be.
One time, I bought a packet of nuts where the 1/3 amount of the nuts were in terrible quality - ok, I understand, happens. Then every other packets of nuts were the same. 1/3 of the nuts needs to be throw away - terrible quality.
Seems I find out why the price is still the same. Now you got only packet with only 2/3 high quality nuts.
Some time ago I found that it is a common practice with "fresh" fishes.
I would prefer to buy at higher price but still get the same...
Everyone is making fool of others nowadays. I need to spend more time at checking if the nuts are even eatable - yeah, still the same price! How good the food producers are...

The overall quality of food will be worse - if possible check the price. If the price is the same for a long period of time you can expect degradation of quality.

 

[Abdullah Cader]

What's happening in your area with respect to prices?

Food?
Housing?
Cost of Living?
Repair services?

Let's here some ground reports.

Recently in Sri Lanka we've faced one of the highest inflation rates in Asia, its made situations unlivable for most slowlaners, fortunately I'm doing fine but from what i've been told about, these are prices people would've never imagined. I'm grateful we haven't gone as bad as Venezuela.
However experienced fastlaners have something to fall back on incase things go south, and most of them have either gone to other countries/ immigrated, or invested in foreign assets with passive income.
Most of the costs which has gone up is:
Electricity/water
Food costs and basically any product all around Sri lanka,
People have increased the prices of their houses and vehicles (etc...)by a plethora just to keep up with inflation.
Unrelated here but because of the horrible currency imports in sri lanka have been stopped and almost all previously imported products have sky rocketed in prices.

 

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[MJ DeMarco]

Have we peaked?

The markets think so.

Dow pops 1,200 points, S&P 500 jumps 5% in biggest rally in two years after light inflation report

October's CPI data came in lighter than expected, raising hopes of peaking inflation.

www.cnbc.com

 

[LateStarter]

Have we peaked?

The markets think so.

I'm not convinced we've peaked yet, but with the recent layoffs happening in the tech sector we can certainly expect inflationary pressures will improve. There's still a massive shortfall of workers in other sectors and salaries are on the rise. I think we'll oscillate a bit before we see the real peak. We're going into the holidays and demand for products and services will remain high until January since there's more disposable income.

Just my 2 cents.

 

[farmer79]

We may have peaked but the optimism from this report seems misplaced or least overdone. Almost 200 SP 500 points (more than 5%) in one day on 7 plus inflation. Powell stated goal of 2 is a looooooooong way off.

 

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[socaldude]

The markets think so.

As the saying goes, “the market is guilty until proven innocent”.

Even though it’s a lower number. That’s still too high. There could be a lot of reasons why.

Although up until this point the recent rally to the 50DMA was mainly driven by industrials.

 

[MJ DeMarco]

Have we peaked?

No peak in the UK...

UK inflation hits 41-year high of 11.1% as food and energy prices continue to soar

U.K. inflation jumped to a 41-year high of 11.1% in October, exceeding expectations as food, transport and energy prices continued to squeeze households and businesses.

www.cnbc.com

 

[Kak]

Long term, no we haven’t peaked. We are on the slippery fiscal slope now. There will be bumps along the slope, but there is there is no turning back.

 

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[woken]

No peak in the UK...

UK inflation hits 41-year high of 11.1% as food and energy prices continue to soar

U.K. inflation jumped to a 41-year high of 11.1% in October, exceeding expectations as food, transport and energy prices continued to squeeze households and businesses.

www.cnbc.com

Peaking at 20%.
Media still continues to say “well, it’s bad but only kind of bad.”

What baffles me is why prices are going up 2-300% when inflation is “only” 11%?

 

[farmer79]

I realize inflation has slowed and is not such a hot button issue as it was, but I almost choked when I went to order paper for the office. I haven’t done this myself in a few years but my secretary was on vacation so I went to order a box (5000 sheets) of copy paper from Staples. Last time I ordered (pre pandemic, don’t remember exactly when) it was in the high 30’s or low 40’s. It is now $79.99. I just shake my head at what has happened to the world.

 

[Everyman]

What baffles me is why prices are going up 2-300% when inflation is “only” 11%?

Because they include different goods, it is a weighted average. Check your country statistics office and their methodology. Sometimes they include odd things like locomotives other times their prices don't match what we see in our local grocery store....

Not saying it is 11% (I would say it is always double what the officals say, at least).

What is 'funny' though it is, what I would call 'deferred inflation' - all these empty FED dollars stuck into empty and meaningless 'investments' like paper gold certificates, bitcoins shitcoins etcc.....

 

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[RicardoGrande]

Have we peaked?

The markets think so.

Dow pops 1,200 points, S&P 500 jumps 5% in biggest rally in two years after light inflation report

October's CPI data came in lighter than expected, raising hopes of peaking inflation.

www.cnbc.com

I've seen quite a bit of speculation that we're headed for a 60s-70s type setup where inflation will subside, but stay above 4% and keep peaking up to 12% and back down for awhile considering the near 0% interest spending spree we're in the hangover of. Hope it doesn't happen, the stories of places with rampant inflation like Argentina (which freezed bank accounts and was seizing people's money) and Turkey are abjectly horrifying.


______________________________
In other news, even though I don't buy BS or snacks my monthly costco run keeps climbing up to new heights.

A standard run with the following would be around 180$ at most back in 2020:
- 20-25lbs of beef roasts
- greek yogurt
- 36 cans of sardines
- box or two of protein bars
- Tub of collagen
- Nice bottle of wine if I'm feeling fancy

And that would make me good to go for about a month albeit I was doing omad every other day.
Now, just adding eggs to that equation, I'm spending at least 240-260$ per trip and prices keep going northward. Had one trip where I had to grab a tub of magnesium and collagen and I was over 300$ which shocked me.

Ham and chicken are cheap-ish still but nutritionally poor imo and I don't care much for them. Trying to batch cook the last remaining cheap beef (stew meat) but even that is peaking above 4.5$/lb. Thinking about getting a blackstone griddle like some kind of dad and just batch frying ground beef (still around 2.5$/lb) with some onions/other filler as a way to fill up and get protein without breaking the bank.

Glad I've paired down my expenses and still doing that every other day omad but I have coworkers with families that are getting absolutely devastated and spending up to 400$ a week on groceries for themselves and their kids (or more if they have... teenagers).

 

[WJK]

Because they include different goods, it is a weighted average. Check your country statistics office and their methodology. Sometimes they include odd things like locomotives other times their prices don't match what we see in our local grocery store....

Not saying it is 11% (I would say it is always double what the officals say, at least).

What is 'funny' though it is, what I would call 'deferred inflation' - all these empty FED dollars stuck into empty and meaningless 'investments' like paper gold certificates, bitcoins shitcoins etcc.....

The last time we had inflation like this, it was in the late 1970s. Early in 1980, we woke up one morning to mortgage interest rates going from 9.5% to 22%. Then they were 24%. The economic world stopped for a long time.

I owned two real estate offices with a partner. We closed one and sold the other one. No, we never got paid for the second one -- so both were a total loss.

The office we closed specialized in creating new housing tracts. We lost 2 years of projects that we had in progress. Our contractors lost their financing so none of them could close their escrows and/or build out the projects. It was a total loss of front-end expenses, time, energy, and potential profits for everyone involved.

So, I had to start over from scratch. It was heartbreaking. My biggest failure was that I never saw it coming. This time I was ready. The RE investors around me didn't see it barreling toward us like a freight train, but I did. Those experiences gave me the gift of vision.

 

[Walter Hay]

Peaking at 20%.
Media still continues to say “well, it’s bad but only kind of bad.”

What baffles me is why prices are going up 2-300% when inflation is “only” 11%?

Why??? The media and governments are all constantly reporting on the terrible rate at which inflation is increasing, with the result that there is a public expectation of price increases.

Vendors take advantage of that by increasing prices to match or exceed those public expectations.

Walter

 

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[fmvpinho]

The last time we had inflation like this, it was in the late 1970s. Early in 1980, we woke up one morning to mortgage interest rates going from 9.5% to 22%. Then they were 24%. The economic world stopped for a long time.

I owned two real estate offices with a partner. We closed one and sold the other one. No, we never got paid for the second one -- so both were a total loss.

The office we closed specialized in creating new housing tracts. We lost 2 years of projects that we had in progress. Our contractors lost their financing so none of them could close their escrows and/or build out the projects. It was a total loss of front-end expenses, time, energy, and potential profits for everyone involved.

So, I had to start over from scratch. It was heartbreaking. My biggest failure was that I never saw it coming. This time I was ready. The RE investors around me didn't see it barreling toward us like a freight train, but I did. Those experiences gave me the gift of vision.

So what do you think will happen to the RE market this time?

 

[Everyman]

So, I had to start over from scratch. It was heartbreaking. My biggest failure was that I never saw it coming. This time I was ready. The RE investors around me didn't see it barreling toward us like a freight train, but I did. Those experiences gave me the gift of vision.

Nice. Great to hear you turned it into wisdom I hope more people are like this

 

[WJK]

So what do you think will happen to the RE market this time?

I don't know in advance exactly how it will look -- but it was time for the cycle to turn. Each time it happens a little bit differently. Before Covid, I was retiring debt while the other investors around me were frantically doing RR&R as fast as they could. They told me that I didn't understand leverage and RE. They had 8 or 10 years of experience. I tried to tell them about the crashes in 1980 and 1990. I threw in the Rodney King riots and the fact that fire insurance doesn't work during civil unrest. And also that I had 35+ of experience. My words fell on deaf ears.

I did NOT follow the herd off of that fiscal cliff.

My program has worked out well and we were ready. 2022 was a banner year for our RE investments. We're still working on everything. The rentals are doing really well and rents are up substantially. This coming summer we will start selling some of the flip properties when they are long-term capital gains. Having vision is priceless!

 

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[WJK]

Nice. Great to hear you turned it into wisdom I hope more people are like this

The best thing I can tell you is to watch the cycles. People are herd animals. They do everything in a stampede. When they are selling, I am buying. When they are buying, I am selling. Being contra to the trends has been one of my secret investment weapons. I don't try to perfectly time the market. I'm happy to be close to the peaks and valleys. Yes, there are times when I leave some money on the table by missing those pivotal moments. No reasonable person assumes that she can pinpoint that exact tipping point when the whole goes sideways. It's enough to recognize the trends and act on them.

I also believe that God blesses the girl who has her own... Leverage is good only during good times. When the market turns, those debt payments quickly sink the whole lifeboat. YOU MUST HAVE YOUR OWN LIQUID MONEY, IN YOUR HAND, AND READY TO WORK FOR YOU! I believe that doing a good deal out of pocket is better than doing a bunch of wonderful deals with borrowed funds. The markets change on a dime without notice or consideration for the hapless guy trying to finish up his deals. I like to sleep at night. I like to be safe rather than sorry.

Yes, by nature, I'm NOT impressed with owning a lot of stuff. If it has to be dusted, hand-washed, polished, loved, or kissed, I leave it at the store for someone who wants it more than I do. I don't have collections of precious items that cannot be used day to day. I gave those collections away years ago. I live simply with a few creature comforts. I'm a minimalist. Big fancy houses must be cleaned and maintained even after they are paid for. Ug! Leave me out of all of that. I tried retiring 20 years ago and it was totally boring. So, I spend my days doing my little RE deals and property management, and doing small acts of kindness for the people around me.

 

[GPM]

I know it isn't much in the whole scheme of things, but it is a sign. 100% of the items at Dollarama up in Canada just went up by $0.25 each. So anything that was $1 is now $1.25, anything that was $4 is now $4.25. The whole store just blanket went up by that much.

Seeing as that won't deter anyone from shopping there, that must be an absolutely astronomical increase on their balance sheet moving forward.

 

[msufan]

Yes, by nature, I'm NOT impressed with owning a lot of stuff. If it has to be dusted, hand-washed, polished, loved, or kissed, I leave it at the store for someone who wants it more than I do. I don't have collections of precious items that cannot be used day to day. I gave those collections away years ago. I live simply with a few creature comforts. I'm a minimalist. Big fancy houses must be cleaned and maintained even after they are paid for. Ug! Leave me out of all of that. I tried retiring 20 years ago and it was totally boring. So, I spend my days doing my little RE deals and property management, and doing small acts of kindness for the people around me.

YEEEEESSSSS. Every single of bit of this resonates with me. Love it!

 

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[Everyman]

This coming summer we will start selling some of the flip properties when they are long-term capital gains. Having vision is priceless!

My (un)educated guess. I am curious what you think.

Next year there are presidential elections in the US which, according to me, will be preceded with huge money printing (either by lowering interest rates or just direct printing called QE euphemistically).

Do you take this into account or my guess is wrong?

 

[WJK]

My (un)educated guess. I am curious what you think.

Next year there are presidential elections in the US which, according to me, will be preceded with huge money printing (either by lowering interest rates or just direct printing called QE euphemistically).

Do you take this into account or my guess is wrong?

I agree that he will try to print money and do some more QE. Biden must do something to make himself more attractive. I'm wondering if the tide has turned. I don't know IF he can turn it around again toward himself. These last 3 years during Covid have been crazy with BS. And it's just now starting to settle down some.

I had some really dry years during Covid. Nothing was happening. It was like everyone was holding their breath collectively. So, since I had completed a debt reduction program, I saved like a squirrel putting away nuts for the coming winter.

Then in 2022 things broke loose again. I bought a couple of flips; 3 mobile homes for my park that we will rehab and rent; I did some paper transactions; Rents went way up for my rentals. It was a banner year.

One of the flips I bought last summer is on a busy street. It was our community dope house for years. I bought it along with the collection of squatters who were inside and outside camping in the yard. They came with their collection of dead vehicles and RVs -- even a huge converted bus. I had owned it for a month before I got to look inside it. I didn't know if it was tear-down or if I had a good shell of a house. Luck for me, it has good bones. All the people are gone and the trash is cleaned up. And we're making progress on it. I want to get it done so I can sell it this summer. I don't want to still be doing this next winter with my money tied up and my a** hanging out. Next!

The other flip is a more remote, dry cabin that came with 9.1 acres divided into 8 lots. It's snowed in right now which is fine. I'll do a lot-line adjustment this spring on a couple of the lots to get them ready to sell. I'll package 3 of the other lots together to sell at the other end of the property. I can get at least a 10% bump in the market value by carrying the paper on those vacant lot bundles. We'll take our bulldozer over there to build the driveways and parking pads before I list them. Selling either group of lots will pay me back for my total purchase price. The rest is all gravy.

That will leave about 5 acres divided into 3 parcels, and a good D log cabin. We'll sell it as one property. When we get done, it will have its own well, a working bathroom and kitchen, a propane heating source, and a carport.

Each of these deals are small compared to what I used to do. That's OK with me. I'm supposed to be retired, but I'm just not good at sitting around while doing nothing.

Oh, and in 2023, I'm foreclosing on a trust deed I own. I bought the paper during the Covid craziness. I have no idea where that is going to go right now. There are serious title problems with the property that can only be solved through either a quiet title action in court or through a trustee's deed gained in a successful foreclosure.

I don't know what this year will bring to my doorstep. I do know the world is up and moving out there again. I say no a lot more than I say yes. I also know that I'm ready to play the game again...

 

[Everyman]

I don't know what this year will bring to my doorstep. I do know the world is up and moving out there again. I say no a lot more than I say yes. I also know that I'm ready to play the game again...

Thanks for sharing all this in such detail. Great read!

Regarding retiring, in general... My feeling is that, esp. men (I am a man), shouldn't retire. I find 'retirement' an artificial/fake concept - working is huge part of our lives. It shouldn't define us but it is important. Why would anyone want to 'retire'?...

Not piciking on anything you wrote. Just thought I would share my 2 cents on it. I personally say now I will never retire because I want to 'work' all my life, whatever we call work, I like making our world a better place, this way or the other, helping other people... Side-tracking from inflation....

I am not worried about inflation. I think the best way is to keep as little currency tied up in bank a/c or any other non-physical resources/assets as possible. The next couple of years it might be better to invest in physical assets, machinery, production tools, and the one on the top of the list - OURSELVES. Skills, knowledge etc etc. We can never lose on this one.

 

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[WJK]

Thanks for sharing all this in such detail. Great read!

Regarding retiring, in general... My feeling is that, esp. men (I am a man), shouldn't retire. I find 'retirement' an artificial/fake concept - working is huge part of our lives. It shouldn't define us but it is important. Why would anyone want to 'retire'?...

Not piciking on anything you wrote. Just thought I would share my 2 cents on it. I personally say now I will never retire because I want to 'work' all my life, whatever we call work, I like making our world a better place, this way or the other, helping other people... Side-tracking from inflation....

I am not worried about inflation. I think the best way is to keep as little currency tied up in bank a/c or any other non-physical resources/assets as possible. The next couple of years it might be better to invest in physical assets, machinery, production tools, and the one on the top of the list - OURSELVES. Skills, knowledge etc etc. We can never lose on this one.

I agree with you on retiring. I did it for my mom...

I was on the road all the time with my RE career. My mom had very serious strokes. I was an independent contractor, so I took her on the road with me 24/7 for about a year and a half. We had a blast together. Those days were a lot of fun. She had more strokes and was too sick to go with me. I either had to put her in a care home or give up my life and move to our home here in Alaska. It broke my heart, so we moved from my home in Los Angeles to rural Alaska. She died the first winter. I remarried -- a local man and I'm still here. It's a different life than my high-powered career...

 

[Everyman]

I either had to put her in a care home or give up my life and move to our home here in Alaska. It broke my heart, so we moved from my home in Los Angeles to rural Alaska. She died the first winter. I remarried -- a local man and I'm still here. It's a different life than my high-powered career...

This is more 'balls' (courage) than when I was watching Predator with Arnold Schwarzenegger

Great share WJK. Thanks!

 

[farmer79]

Inflation report from Saskatchewan, Canada. I keep hearing inflation has peaked and is slowing down and I just don’t see it at the grocery store. We don’t buy cereal often but my younger kids love the little single portion cereal boxes. Anyways haven’t bought them for probably a year and I don’t remember the last price I paid for them but I distinctly remember being able to get an 8 pack pre/early covid for $3.99. My 8 year old was with me at the store and asked to get them and they were $8.29. We passed.

We rarely go to Macdonalds, but my son also asked to get a Big Mac because he had never had one, and I figured that is a worthy father-son right of passage. So I order him a Big Mac and it was $6.89, with taxes $7.75. Again at least $1 higher than 6-12 months ago.

 

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[daivey]

Inflation report from Saskatchewan, Canada. I keep hearing inflation has peaked and is slowing down and I just don’t see it at the grocery store. We don’t buy cereal often but my younger kids love the little single portion cereal boxes. Anyways haven’t bought them for probably a year and I don’t remember the last price I paid for them but I distinctly remember being able to get an 8 pack pre/early covid for $3.99. My 8 year old was with me at the store and asked to get them and they were $8.29. We passed.

We rarely go to Macdonalds, but my son also asked to get a Big Mac because he had never had one, and I figured that is a worthy father-son right of passage. So I order him a Big Mac and it was $6.89, with taxes $7.75. Again at least $1 higher than 6-12 months ago.

me being a slow-laner, I shop the flyers and haven't noticed much inflation my staple purchases..

generally the major grocery chains have weekly flyers and can get my routine stuff..

I will say the highest priced items that are really 'eye popping' to me are:
1) hellmans mayonaise.. I would get the costco size for like $5.99 when it would go on sale pretty much every other week...Regular price was like $6.99.
Now regular price is $9.99... So i though that was a huge jump.

2) olive oil; there is one that i like that is about 3 liters, at Costco. This use to be $19.99 the other day it was $29.99... but im not sure if this is inflation or a drought causing a shortage cause this happened in the last 3 months.

3) OIL CHANGEs: ok this is more of a service but Volkswagon would charge $99 for an oil change... Now they want $149.99.
But this is a stealership so i am not surprised.


With regards to cereals, like the quoted example above, i think youre just getting ripped off cause of the package size. Pretty much Costco size cereal is the same price as always been at costco..
I find Metro, Loblaws, Walmart, like to rip people off on their smaller sizes..

 

[Jrjohnny]

I'm looking to dump cash into a large property that I can deem my primary residence, not as an investment, but merely as an insurance policy. If I get caught buying at the top, I don't mind losing a few million since it will be home I plan to live in for the rest of my life.

Unfortunately, here's just a little insight into how CRAZY the RE market is.

Saw a house in SLC that came up for sale. Mind you, it was listed for $4.8M and these higher price ranges (at least in the past) tend to stay on the market for a few weeks. It was a bit out of my budget but I'm chomping at the bit to unwind cash so I decided I would go look at it. Before I could even book a flight and get more details on it, it went Under Contract.

Even in these high prices ranges, houses are flying off the market. Bidding wars are not happening just at the $500K level, it is now transpiring in the mid-7 figure range.

In similar vain, I saw houses that didn't sell two years ago listed @ $2M now being relisted at $3.5M. Why not? If you can make $1.5M doing nothing in two years, can you blame them? But inflation is well contained.

I find this really funny.