Let’s face it, we’ve all wondered if the price of bread is getting so high because it’s easy to see Jesus on a piece of toast. But it’s harder to make the same argument about mayo, vanilla ice cream, and milk; Jesus wasn’t white, after all. So who, or what, is holding the broom as inflation sweeps the nation?
We dialed up our favorite ranking strategy, a MaxDiff, which uses a statistical model to accurately assess what is to blame for rising inflation.
The three main culprits hiding under the (inflated) Scooby Doo mask are excess government spending, the COVID-19 pandemic, and the Russia-Ukraine war. The pandemic, in particular, has guest-starred on so many episodes of The Economy that it really should just be a full cast member at this point. According to Americans, least to blame for inflation are chip shortages, banks, and consumers. Clearly someone didn’t have to wait an extra six weeks for their smart fridge to show up.
Where does the economy go from here? It’s an important question, because the public’s expectations about inflation and the economy can themselves cause inflation, despite the relatively low importance Americans attribute to “consumer expectations.” We asked about expectations back in June 2021. Here’s how the outlook has changed since then:
- In June ‘21, 34% thought the economy was headed in the wrong direction, now it’s 62%.
- Then, 82% noticed the cost of goods and services increasing. Now, 95% have noticed.
- 60% thought inflation would continue to rise in the long term; now it’s 64%.
It’s only out of sheer Christmas-in-August spirit (and the fact that we didn’t ask) that we aren’t showing the same comparisons for crypto.