Lumber Prices … wow

[an]

[quote=deadzone][quote=gzz]My inflation monitors are LCD computer monitors and cow’s milk.

A 24 inch monitor cost $3000 in 2002, and now costs $110.

Milk cost about $2.50 a gallon in the 80s, now is around $3.

Really massive deflation![/quote]

I think most folks would gladly accept paying $3000 for monitors in exchange for paying 2002 rental rates.[/quote]
I’d also gladly accept 2002 gas price, electricity price, home price, etc.

[sdduuuude]

gzz, I was thinking more of a covid-related supply issue than inflation, myself. And relevant to the housing market.

[Hobie]

What is Canada doing with tariffs re exporting its lumber? Lumber mills in OR and WA have plenty of labor available and trees to harvest. Is this just the industry maybe taking advantage of the current construction boom.

Are we seeing,”What the market will bear” pricing. Families with 2 spouses working have more cash– expect the cost of goods in there living area to rise. Not necessarily an indication of inflation.

Look at ice cream. Not long ago, the industry colluded and changed to smaller packaging keeping same price. Now, prices are higher for smaller quantity. Clever marketing or just manipulating the market knowing it has a comfort product that will always sell.

I can relate to the burrito index!

[svelte]

I could certainly be wrong, but my impression is that the price increases we are seeing right now are temporary. They are a result of interrupting the supply chains due to the pandemic shutdowns.

Once the supply chains are up and running in some semblance of normalcy, I think prices will come back down. It all boils down to supply and demand as it normally does.

I heard one explanation to the skyrocketing house prices that I think has merit: due to the interruption in the supply of lumber for building new homes, the supply of new homes dwindled. Many of those who would normally have bought a new home instead shopped for older homes, driving up the number of buyers for them and thus driving up prices.

[svelte]

[quote=Hobie]What is Canada doing with tariffs re exporting its lumber? Lumber mills in OR and WA have plenty of labor available and trees to harvest. Is this just the industry maybe taking advantage of the current construction boom.
[/quote]

This WSJ video takes a look at why lumber prices are up, pretty detailed.

I didn’t know about the US Government encouraging farmers in the south to plant trees, which will result in an abundance of lumber for years to come.

[The-Shoveler]

Warren Buffett
“We are seeing substantial inflation,” Buffett said at the Berkshire Hathaway annual shareholder meeting broadcast exclusively by Yahoo Finance. “We are raising prices. People are raising prices to us, and it’s being accepted.”

Whirlpool appliance maker just jacked up prices by 5% to 12% to counteract rising steel costs.

Proctor & Gamble said recently it would begin to hike prices on baby care, feminine care and adult incontinence products in the United States. Price increases will range from mid- to high-single digit percentages. The hikes will go into effect in mid-September.

[gzz]

I just noticed an adaption to the lumber price surge already at Home Depot.

After a few months of no stock or absurd pricing on fence pickets, now they have lower quality lumber in place of redwood and cedar at the old price of about $2 a picket.

[phaster]

[quote=Sdcateacher]I agree. I see hyperinflation to the point it will destroy people’s savings. The best bet at this point is liquidate if you have the means and move to an area where you can buy a house cash and have very little overhead. I would also start learning how to trade E-mini future contracts and stop chasing stocks. I see the market moving into a sideways range bound low volume muted market reminiscent of 2014-1015. I have enough right now to move to an hour outside of Knoxville, or Charleston, etc have enough to pay a house cash and have a substantial amount left over to diversify. The taxes and cost of living in San Diego and SoCal will mirror what I saw happen in the suburbs of NYC where the average 2000sqft house is paying up to 3-5% a year in property taxes. It is absurd, but as the demographic of SoCal continues to change, population increasing and middle class people moving, I don’t see good things. Moving forward I liquidated most of my investments on 1/15/21 after a phenomenal 4 year return and over 800% in the past year. Why push it? After trading for 25 years, there is a time to take it off the table.[/quote]

ever consider because the US dollar is the global currency there can’t be hyperinflation (like what happened in post WW I Germany, or the hyperinflation in Zimbabwe)

actually what seems to be happening is the expected result of growing populations and increased demand (which increases prices), combined with sad fact that political leadership spends taxpayer money unwisely on stuff that does not create lasting value,…

https://drive.google.com/file/d/1pXS9yudHelEdCSJsKs_X67cosuM5n2DM/view

basically the US dollar will one day no longer be the global reserve currency (perhaps this might much sooner than most people expect) and only when this happens is when hyperinflation can happen (i.e. the economist issue of “the Triffin Dilemma”)

[Author]

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