What's the one thing that affects just about everybody? Money.
Many people have noticed that they're spending a lot more of it on everyday items, thanks to inflation.
The U.S. Department of Labor reports that the price for consumer goods rose by 0.6% last month. In the past year - it rose 7.5%. That's the highest year over year increase since the early 1980's.
NBC Connecticut’s Dan Corcoran spoke with Brian Marks, an economics professor at the University of New Haven, about what inflation is and why it's happening.
DAN CORCORAN: "Brian, let's start with the basics. What even is inflation? What causes it?"
BRIAN MARKS: "In the current environment, we have two factors that are causing our increases in prices. We have the demand side of the equation and the supply side of the equation. And for our purposes in this environment, we're being hit from both sides. One, we have a given amount of supplies and demand has increased as the economies have reopened. So we're seeing that shift in demand. Complicating factors is the constraints on supply due to our supply chain issues, which as a result is causing our price increases."
DAN: "What items what products are costing us more these days? Is there anything that's actually safe from inflation?"
BRIAN: "It's unfortunate, anything energy related is going to be hit by inflation. A little over a year ago, the price of a barrel of oil, West Texas Intermediate was about $35 a barrel. Today, we're over $90 a barrel. So our energy and utility costs are certainly feeling the pinch, if you will, food prices, housing prices, we're experiencing what in essence is a 40 year high in inflation. And in the last eight months or so, we've seen inflation over 8%. And right now, the latest report is where it's 7.5%."
DAN: "Here in Connecticut, are we seeing the same high prices as the rest of the country? Is there anything different happening here?"
BRIAN: "No, Connecticut is experiencing the same thing. We can't run away from the energy costs. And as a result, we're seeing that and same thing with housing and rental, and quite frankly, even healthcare is experiencing now."
DAN: "Now that we've dissected the problem, the remaining question is, how do we get it to stop?"
BRIAN: "So, how do we get it to stop? That is a very nuanced question, which requires a nuanced response, if you will. We can anticipate for 2022, the Fed is going to push up interest rates as a way to sort of put pressure, downward pressure, on borrowing, which then could slow the economy down. So that's one aspect. The other aspect, we can look at fiscal policy. And one of those aspects could be what could we do to ease the burdens and pressures on the supply chain side of the equation, so more supply could be made available and therefore reduce risk and uncertainty. Some of that may be reshoring manufacturing here in the United States or in Connecticut."