A New Narrative on Two Huge Issues — Inflation and Urban Crime
Author: Greg Valliere
June 12, 2024
THE CONVENTIONAL WISDOM MAY BE SHIFTING on two huge issues that may determine the fall elections. Price cutting is all the rage among retailers, and crime statistics suddenly have plunged.
AFTER A YEARS-LONG RUN-UP IN PRICES that has caused many to pull back on spending, analysts sense a turning point, according to a report in this morning’s Washington Post. The article cites several examples of price cutting:
* Ford marked down its electric Mustang Mach-E by 17%.
* Target is slashing prices on 5,000 items, including Persil laundry detergent by 5%, Clorox wipes by 14% and Purina One cat food by 7%.
* At Walgreens, swim goggles and Squishmallows are discounted by as much as 40%.
* Some major retailers are taking sweeping steps. Ikea has lowered prices three times in the past year, while Best Buy has been marking down appliances.
* Arts and crafts chain Michaels says it’s slashing prices on 5,000 items including stickers, canvases and T-shirts.
* And several fast food chains, like McDonalds and Burger King, are offering lower-priced options.
CONSUMERS ARE PULLING BACK on big-ticket items like homes, cars and washing machines, while also reconsidering smaller expenses like new shoes and fast food.
BUT PRICES ARE NOT PLUNGING in some areas of the economy — prices for services, housing, health care and insurance remain elevated.
THE POST ARTICLE CONCLUDES THERE MAY BE A TURNAROUND. The article quotes an expert who says that “Retailers overreached when they started jacking up prices,” says Mark Cohen, director of retail studies at Columbia Business School. “Business has gotten stuck. Things are slowing down. Companies are waking up and realizing they have to start reducing prices.”
* * * *
ANOTHER TURNING POINT — CRIME: Data released this week by the FBI show a sharp drop in violent crime. Homicides and rapes both declined about 26% in the first three months of 2024 compared with a year earlier, robberies were down about 18% and aggravated assault fell by about 13%, the FBI said. Reported property crime declined about 15%.
THE PUBLIC IS STILL JITTERY, as the local TV news usually begins with crime stories, and there’s still a sense of unease in big cities like Chicago and Atlanta. But one crime expert, quoted in this morning’s Wall Street Journal, proclaimed that crime is nearing 50-year lows. This issue isn’t a plus for Joe Biden, but it may not be a big negative if these trends persist.
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