The real estate blog.

I’m just getting back into my regular routine and was checking around the web on all the stories I missed this week while on an Internet free blogcation. One of the stories that hit me was titled Inflation Is Everybody’s Problem.

It’s true because inflation impacts consumption. Whether you’re rich or poor, you have to eat, get shelter and transport yourself. With inflation hitting all three of these aspects of life, everybody feels the pain. The housing bubble was partially a form of housing inflation and increases in food a fuel prices over the past several years is hurting a lot of people, particularly those on fixed incomes.

While I was in New York this week, I stepped into the tail end of a panhandling transaction. I was lining up to buy a Nathan’s hot dog in Coney

Island when the gentleman in front of me handed a dollar to an older, homeless man. After the homeless man left, the gentleman declared in a thick New York accent to his companion and the man behind him that he was experiencing a sort of “bum inflation.” It was no longer acceptable to panhandlers to receive a quarter. One has to pay a dollar for them to move on. The old line from the Great Depression was, “Brother, can you spare a dime?” 75 years later that number is now a dollar.

There are only two things individuals can do about inflation, earn more or spend less. We don’t set economic policy and we don’t set prices of goods and services. How we do affect prices is deciding whether to buy. If enough people don’t buy, the price drops. If enough people do buy, the price remains stable, or even goes up. Unfortunately, much of the highest inflation is coming from necessities - food, heating fuel and gasoline. It’s only possible to cut back so far before one has to increase their income.