Everybody notices when prices go up. But when they fall, it’s an unacknowledged gift.
Ask a typical American family, and they’ll tell you that the surging costs of healthcare and education are among their biggest strains. Energy prices are an ongoing concern, stable now but punishing when they spike. But many consumers don’t realize that dozens of everyday goods and services have been getting cheaper. Overall inflation in 2010 is just 2 percent or so, after a record drop in prices in 2009. Some economists even think deflation is a bigger risk to the economy than inflation, since falling prices can cut into corporate profits and force long-lasting pay cuts.
But for now, consumers are enjoying a windfall of cheap stuff, thanks to low-cost imports, rapid technological change, and falling demand for some things. To determine the most significant price declines, I analyzed data from the Bureau of Labor Statistics on the 211 categories that make up the consumer price index, the most common measure of inflation. Over the last 10 years, the cost of goods and services in about 60 of those categories has fallen, while overall inflation has been about 28 percent, or 2.8 percent per year. A lot of other stuff has risen in price, but by less than inflation, which means it’s getting more affordable for people whose incomes are keeping up with inflation.
Some things don’t seem cheaper because manufacturers often keep prices stable while adding new features or improving performance–and convincing consumers they’ve got to have the latest 4G phone or ultrathin laptop. But consumers still get more for their money, even if they’re paying for extras they don’t really need. Here are some of the most notable things that are coming down in price:
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Via: Finance/yahoo.com
