$4.99 for toothbrushes - May 26th, 2011 - CLICK for enlarged view
Inflation is a hip topic lately. Everyone has an opinion and a story, but these stories oftentimes seem disconnected with everyday life. Even gasoline has the feel of a process that takes time, technology and geo-strategic positioning to secure. But there is an item that I’ve been purchasing every couple months that does not change much in scarcity or design. That item is a Double-Pack of Firm toothbrushes.
I’ve watched he price of these very basic toothbrushes go up in price over the last year. But today, the price of a 2-pack of firm basic toothbrushes was $4.99 plus tax.
These were the same style toothbrushes that I’ve purchased for years now. The model or style has not changed. But the price sure has.
Do you remember talking to your parents about the price of a movie ticket back during their childhood? Even though their stories were shocking, there always was this distance about it. It never really seemed like an alarming change because so much time had passed.
Well, if I showed myself the receipt for the $4.99 plus tax double pack firm toothbrushes to myself even five years ago…I would have laughed in my own face.
I can’t remember how much he same pack cost a few months ago. But I know it sure wasn’t $4.99 lemme tell ya.
For $4.99, I would expect the toothbrush to come with something, like a gift certificate for toothpaste or a pair of brass knuckles or something. Wait, that doesn’t make sense with how the precious metals have been doing in the marketplace lately.
The difference between inflation and hyperinflation is the rate and scale in which the things happen. Inflation is actually a normal thing that happens in a healthy economy. But hyperinflation means that the currency is poising purchasing power and value at a much faster rate than the economy is growing into new markets. Hyperinflation becomes self evident to even the laypersons who know little about economic theory or mathematics. They directly experience the hyperinflation by witnessing and experiencing ridiculous jumps in prices in basic items that require little advanced technology to create.
For example, a flat screen tv or a sports car might not be the best determiners for hyperinflation. The parts inside can be the subject of market forces and also the labor and machines in order to mass produce them require energy to create the product. But toothbrushes are made out of basic plastic by machines with some bristles. Seeing huge price hikes in toothbrushes are beyond concerning.
The biggest warning sign will be when the price of the most basic form of Internet service increases. Because the Internet will be the main way for people to discuss how to make items for themselves. Man, I wish I paid more attention during cub scouts and sea explorers.
UPDATE: Ryan E. gave some information saying that Hyperinflation is actually when the inflation rate gets to 10% per day or 50% per week. I looked on Wikipedia and this confirmed this. So I concede the fact that this may not be “textbook” hyperinflation, there are some things that are happening in the marketplace to ease it from being so. One thing is how outsourcing and automation has decreased the production costs of many mass produced goods. If it were not for automation and cheap labor, then this Toothbrush 2-pack probably would have cost much higher than $4.99 plus tax.
Of course, that being said, if it wasn’t for automation and outsourcing we probably wouldn’t be in this mess in the first place.
Yet when I think about toothbrushes, these things should only cost around $1.50 or $2.00 or so. So perhaps this is more a cusp transition grey area between inflation and Hyperinflation.
-Tyler