Why Everything Costs More Right Now (And What's Actually Driving It)

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Networth and Chill with Your Rich BFF 33 min 1 speaker 4 chapters transcribed 2 months ago
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Why does the episode say prices feel 'bananas' right now?

Monica Vantilburg 0:00
these prices are getting bananas. When energy gets expensive, it also ripples through everything else. Since transportation and production costs go up, there's huge demand for housing right now and not enough supply, which is why rent and mortgages are shooting up pretty much everywhere in the country. Healthcare is another area that has been ballooning in cost. And then there's food. Not only is eating out more pricey, so is buying a carrot at the supermarket. Are these costs going to drop anytime soon? Well,
Monica Vantilburg 0:37
What's up, everyone? Welcome back to another episode of Net Worth and Chill. I'm your host, Vivian Tu, aka Yorich BFF, and your favorite Wall Street girly. Lately, all we can talk about is that the cost of living is up, up, up. Gas prices are still criminally high, a cocktail in Manhattan is now breaching 25 doll hairs, and rent everywhere basically costs you your left arm and your firstborn child. It seems like everything is going up and there's no hope for things slowing down. But what if I told you there are ways to make life a little bit more affordable? That there are hacks that you can use to bring down your monthly expenses by a couple hundred dollars? Today on Net Worth and Chill, we'll be talking about what's causing the cost of living crisis, where your wallet is hurting the most, and how to bring those prices back down to a number that actually makes sense with your income.
Monica Vantilburg 1:25
Support for the show comes from Walmart. If you're ready for summer vibes but don't want to spend a lot, Walmart's got your back. Right now, Walmart's dropping prices with thousands of rollbacks and more on summer party essentials, from grills to coolers and even slushy machines. So whether you're firing up, cooling down, or just getting ready for a weekend in the sun, now's your time to save. Shop and save in the Walmart app online and in stores today. So why do things get more expensive? If the actual stuff we're buying isn't improving, why do the prices change so much? Our daily cost of living, things like housing, food, transportation, you name it, isn't just decided in a vacuum. Officially, cost of living is an economic measure that notes the change in price up or down of the basic necessities of life, such as food, housing, transportation, health care.
Monica Vantilburg 2:13
You get the idea. The rising price of the stuff we buy is called inflation, which I'm sure you've heard all about. It's no secret that inflation has been skyrocketing recently. Inflation is rising at the highest pace it has in years, which is basically just a measurement that says you're heading towards a situation where you're paying more and more just to survive. Not to mention this compounds on prior years' inflation, which has been historically high ever since post-COVID. So in English, a high inflation rate is the official way of saying, yes, these prices are getting bananas. Generally, there are three types of inflation, cost push, demand pull, and built-in inflation. Cost push inflation happens when something gets more expensive to make, so companies jack the prices up.
Monica Vantilburg 2:59
Easy example, coffee is so expensive now because there's huge issues with the farming of coffee beans. Coffee beans grow in tropical climates, which have been hugely affected by climate change. Dry seasons, freak weather incidents, and inconsistent weather have been causing poor yields. So there's less beans to go around, period. That means that there's also just less product to sell, which then pushes the prices up. And boom, now your morning cup of black drip coffee costs $3.50 when it used to be $1.90 in 1990. If you're used to swinging by the deli every morning, that's a $584 jump in your annual expenses. Meanwhile, demand pull inflation is basically the hype beast effect. When everyone wants something across an industry, the prices tend to rise.
Monica Vantilburg 3:46
Take tech, for example. It's not enough anymore to just have one laptop that's operating on Windows Vista. Now everyone wants a tablet, a smartphone, a smartwatch, maybe even wearable glasses with an AI assistant built into them.

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