Inflation rarely reverses course, especially when wages are tied to it.
Sure lumber, oil, metals, etc could probably be traded cheaper down the road when demand recedes…but when does the cost of labor go down? When do we see widespread labor costs go down across a market? Almost Never. The rate of price increases will slow, but prices themselves aren’t going anywhere. I had to laugh when a buddy told me he was “waiting to pull the trigger on a new F150 until they’re back under $40k and the market is balanced.”
In my opinion, “times they are a changin”…but they are also stayin’.
Exactly. Remember all the surcharges put in place when gas was $4/gallon? FedEx, UPS, etc all raised their prices because of it. All sort of other products and services did, too. But when gas prices fell, those prices and surcharges remained. Once businesses adjust their business to accommodate and expect those higher prices, there is no going back!
Outside of a major recession, when companies are forced to cut prices just to stay afloat, there is no going back to old prices.