Wednesday, February 04, 2009

Pockets of Inflation

Considering the economy is in the tank, most commodity prices are down relative to last year, and unemployment is up relative to last year, I am surprised to find pockets of inflation. These have been discovered as I have recently decided to go ahead and make purchases that I was putting off last year.

The first of these is a full size box spring (foundation). Last year at Denver Mattress this item was $109 or $99 if purchased with a mattress. We only needed the mattress and rather than store the box spring, I decided to hold off until we needed it. I decided we needed it last weekend and to my surprise this item would now cost $174. The most surprising thing was the sales person’s cost justification as being due to the price of steel which has dropped in raw cost along with transportation charges. The 60% bump is a tough pill to swallow.

The second item brought to my attention is a Pro Bike Fit. I have all the toys I can stand to play with and rather than getting a new bike last year at a significant discount, I decided to hold off and start this season with a professional fit and power meter. The fit was listed for $189 last year. I just checked the website and the current rate is $250, a 32% price jump. I haven’t actually stopped by, but am curious to know why the price went up. A professional bike fit is definitely discretionary spending, and I will suck up the extra $60, but again I wonder what gives.

At least I can catch some savings elsewhere. Food, clothing and energy prices are down somewhat. Mortgage rates are also down, if I could pull the trigger on refinancing. Other purchases I have been eyeing such as cutlery and sports equipment is at least flat and I have gained the opportunity cost of foregoing the purchases.

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