The Psychology of Inflation

by Ben Carlson
A Wealth of Common Sense

A reader asks:

I get all the stuff Ben has been saying about inflation — wages have kept pace, economic growth has been higher than the 2010s, wages have risen the most for lower income people, etc. I get all that. My husband and I own a house and own stocks so we’ve benefitted in recent years. Having said all of that, I STILL CAN’T GET OVER HOW HIGH PRICES ARE!!!

The grocery store, home/auto insurance, restaurants, babysitters for the kids…everything is more expensive.

So how do I get over the sticker shock? Will it just fade eventually as we get used to higher prices?

The psychological component of inflation is obviously a real phenomenon.

One of the reasons for this is because inflation is personal.

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