$14 Hershey Bars
If you, like me, have noticed that the price of certain impulse buys in the checkout line at the grocery store is up materially versus pre-pandemic levels, you can take some solace in the notion that it could be considerably worse. "[The] cost of a ticket for The Beatles at Shea Stadium in August of 1965 was $5.65. For Beyonce at MetLife in July 2023 it's $1,568," BofA's Michael Hartnett said, in an especially colorful edition of his popular weekly Flow Show series. "If inflation had kept pace
7 thoughts on “$14 Hershey Bars”
Odd Lots podcast had Matt King and his analysis indicated that a lot of liquidity was in the system despite rate hikes: effectively it was still QE and that it shows up in equities.
I don’t buy the “it’s social security inflation adjustment driving inflation” so we’ll have to see if this “Q1 and beyond” is indeed a Fed Put nee bull market or just a bear rally waiting for a crisis?
Matt’s great, but he’s been making (basically) the same slide deck for 14 years. Not to say he’s wrong, it’s just that you know what Matt’s gonna say. That’s why Tracy had him on. If you’ve followed all of these people for two decades it all feels so scripted. Like, “Of course Tracy had Matt King on this week.” Again: Not to disparage them at all. It’s just amusing to me.
Thanks for the inside context, that makes me appreciate the showmanship (and your reveals) all the more! =]
I think we shouldn’t just look at these figures at face value and assume that something else isn’t masking the inflation that should have been applied. Outsourcing overseas manufacturing has reduced the cost of goods and insulated the consumer from the price hikes we would have seen had manufacturing remained in the same place it was in 1965. Taken with alternative ingredients for candy bars in substances like high fructose corn syrup which is much cheaper to produce than sugar and there are a multitude of reasons why Hershey bars are not $14.00 (not least of which, they are much smaller than they were in 1965). Housing can also be viewed in a similar light, mortgage rates touching the low 2%’s recently definitely reduced the cost of buying a home. I can’t find what rates were in 1965 but in 1971 they were around 7.5% only climbing further into the 1980’s. Taken with the lower cost construction methods (and often cheap illegal labor) and materials and again you can find the reason why these specific areas have not inflated as much as they should have.
All of this is to say that we shouldn’t assume that we haven’t felt the inflationary impacts that are masked by what appear to be, on the surface, lower prices.
I realize you were just going for some rhetorical flair, but 42 years ago: https://www.washingtonpost.com/archive/politics/1981/12/07/monopolistic-or-just-smart/b634aa48-0d71-4bbd-a104-6ad7d471e859/
As of 2013, Hershey and Mars controlled 75% of the chocolate market in the US. Today it’s more than 80%.
More competition means more variety, lower margins, and more jobs. It also means buying a share of stock actually becomes speculative, again, not just the purchase of the fractional share of GDP. Make equities great again, take the guillotine to corporate america!
When I was about twelve (in 1976), I could buy a Snickers bar and a bottle of RC Cola for twenty-five cents at my neighborhood grocery store, and if I took the bottle back I when I was done, I got a nickel deposit-refund for it. People complained about inflation then too. I remember when the price went up to thirty-cents how unfair it felt. (I believe my allowance was about $3.00 a-week back then.)
I can tell you a FULL 1 oz. Hershey was 5 cents in 1965. I cut grass with a push mower all day for my 50 cents to get that, a Pepsi and a movie.
UAW – GM line work paid about $30 a day at that time.