Both CNN and CNBC are reporting on the depletion of food stocks at most grocery stores so we went out and took a look for ourselves and we can confirm that there are plenty of empty shelves. The empty shelves weren’t limited to food, the cold and flu sections of a few stores we visited were stripped clean of all product. What’s going on??
In essence there are three key problems:
- Not enough labor – With millions of boomers leaving the work force to retire, people have new options to find new jobs and careers and essentially move “up” in the world to higher paying jobs.
- Supply chain disruptions – It is still difficult to find items but what most people aren’t aware is that it takes some items to make other items and if you don’t have those basic components then you can’t make other products. It’s well known that there are shortages of computer chips that are impacting the production of cars.
- Consumer demand – People are staying home to stay safe as covid spike so there is additional pressure on demand.
What is the net result? More inflation and higher costs for food and other products over the next 90 days so we’ll see what happens but this is all the more reason to ensure that you are generating additional income either at work or through investments. As we stated in Basic Economy (Defensive) Stocks, these are the things people will focus on when prices get out of control for other goods and services.
Stay tuned and stay solvent…