Guest Post by Martin Armstrong
Shrinkflation is here to stay now that inflation has reached a 39-year high. It will take the Fed time to tame the monster it unleashed by artificially lowering rates, although governments could take immediate action to help the current supply chain crisis. Shrinkflation, by the way, occurs when products remain the same price or rise, while the product size decreases.
“Portion sizes are shrinking. Prices are going up. It’s just insane what’s happening in the restaurant industry,” former McDonald’s USA CEO Ed Rensi told Fox News. “It’s also true of every other small business. They’re all suffering terribly from this federal inflation.” Yet, McDonald’s saw 7.5% growth in Q4 2021. Regardless, the fast-food giant is recommending that franchises raise their costs between 6% to 6.5% next year.
“The biggest single problem we’ve got is the…truckers shortage and a disruption of imports coming into this country,” Rensi added. “This truckers’ situation is enormous and is having a big impact.” So while the jobs situation is improving, with the US boasting a 4% unemployment rate, the mandates have devoured the supply chain.
As for other examples of shrinkflation, Chobani decreased its flip yogurt by 15% in size. Crest decreased its whitening toothpaste from 4.1 oz to 3.8 oz, while Gain decreased its laundry detergent from 165 FL OZ to 154 FL OZ. Inflation is so severe that products are increasing in price while shrinking in many instances. Barilla pasta formerly sold its spaghetti for under a dollar at 454 g, yet decreased the package to 410 9 and increased the price by nearly 100%. This level of inflation is completely unsustainable and consumers are suffering the consequences.
As former CEO Rensi said in his insightful interview, “Let’s lighten up a little bit, let our bodies handle it, instead of government handling it.” End the mandates to help boost the suffering supply chain that is contributing to inflation. This is one variable that the government has instant control over.
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We’re asking our abusers to help us?
Times like these (all times, really) demand that you look around you, notice what’s happening, and act accordingly.
I went through our freezers today. Moved anything that is not an animal product (bread, soup I froze when I made too much, veggies like kale, carrots, pasta sauce) to the front and into the fridge for thawing, to be consumed in the next couple of weeks. Will fill up freezer space with only meat.
Svarga – I will be planting my lettuce, kale, spinach and green peas today. Temps in the mid 60’s and the cold frame is ready.
Ugh. Still cold here. Planning to put the tomato and eggplant seeds under grow light tomorrow.
We still have a couple of pigs available.
A coinky dink that he supplied a picture of spaghetti….there has not been one package of any brand in either of our two grocery outlets for three weeks now..
annuit coeptis novus ordo seclorum <—====
shrinkflation is nothing new, just more innovative marketing strategy
So while the jobs situation is improving, with the US boasting a 4% unemployment rate, the mandates have devoured the supply chain.
I don’t care how smart people think Marty is, I think he’s a stooge moran.
Utter tripe.
Several years ago, Kroger reduced the size of their frozen vegetables from 16 oz to 12 oz. At the same time, they changed the size of portions from 4 oz to 3 oz, thus maintaining 4 servings per package. According to the government, this means zero inflation for the smaller package as it still contained 4 servings.
“The biggest single problem we’ve got is the…truckers shortage and a disruption of imports coming into this country,” Rensi added. “This truckers’ situation is enormous and is having a big impact.”
Right.
Everyone changed their packaging and pricing in the last ten days.
Nice try.
I could put up with the shrinking size of products if the government also shrank.
Little chance of that.
They always screw the customer when they go full metric
The metric system is the weights and measures system of the lucifararians.
As a Scientist, I see your point but Metrics are actually better for Science and politically neutral.
Look on the bright side: maybe this is the portion control that the fat fucks in this country really need.
Product size/amount has been lessened now for years…perhaps not as blatantly as it is now, though.
coffee creamer and other liquid products are watered down now. It actually changed the taste. I imagine that it must taste the same as $hit. Same with liquid soaps etc…watered down.
Shortages cause price increases. Shortages do not cause inflation. Price increases and inflation look the same to the consumer at any given moment. Blaming the company that hid the inflation in a smaller product size for the same or higher price is pointing the finger where government wants it pointed. Even if it is a giant evil corporation it is only responding to a condition caused by government.
Inflation is ever and only an increasing amount of monetary units chasing available goods. Regulation can cause price increases (see Keystone pipeline, oil lease shutdown) that is regulation caused scarcity which causes prices to increase. See also port rules in California strangling shipment of goods, more regulatory scarcity, more price increases. In every case regulation that increases scarcity creates price increases in those goods.
The monetary units dumped into the economy since the last big collapse have caused a lot of inflation in segments of the economy, securities, real estate, certain intellectual properties. The money dumped directly onto the public in response to governments asinine response to COVID has caused the general inflation we are seeing which combines with price increases due to shortages caused by… governments asinine response to COVID plus regulatory strangling of production.
It’s almost as though they mean to destroy us. Mistakes, blunders, do not ALWAYS happen in one direction, beneficial errors do occur.
Walter, I don’t blame the manufacturers for inflation. Excessive increases in the money supply thanks to massive printing money and giving it away plus the Fed essentially making bank reserves -0-, are what caused initial inflation. Now we’re going to see the next round, as every product we buy is transported, and fuel costs are passed through. All to be expected, including inflation or price increases potato/potato.
What I do hold manufacturers accountable for is attempted deceit of their customers. And that’s exactly what they’re doing. I am glad for my supermarket for including unit prices so I can compare the real per oz price and not be fooled by apparent package size or have to carry a pocket calculator around the store.