Economics in the News – Nov. 22-28, 2021
Economics impacts our lives every day. Below are some of the top storylines from this past week related to economics.
- Fears of a new COVID-19 variant sank the S&P 500 to its worst day of trading since February.The variant, called Omicron by the World Health Organization, was first detected in South Africa is quickly spreading across the globe. Investors are uncertain whether the new variant will derail months of economic recovery.
The European Union and the United Kingdom have placed traveling restrictions from southern Africa, while United States President Joe Biden placed travel restrictions on South Africa and seven other African countries. [The Associated Press]
- What was the best deal you found while Black Friday shopping? Traffic at brick-and-mortar stores increased 61 percent in 2021, compared to 2020 that was heavily impacted by COVID-19. However, in-store traffic was down 27 percent from pre-pandemic levels. Online sales were slightly down compared to last year, with $8.9 billion spent, after $9 billion was spent in 2020.
Consumers were faced with numerous hurdles this year, including widespread supply chain constraints, a labor shortage, rapid inflation and news of an emerging COVID-19 variant from South Africa. Shoppers are also starting their shopping earlier this season, while many people are taking advantage of Buy-now-pay-later services. [Business Insider]
- For the first time in their lives, Millennials and younger generations are experiencing rapid price increases. The Consumer Price Index (CPI) is at its highest level since 1991. Some of the most extreme gains, such as in rental markets and gas prices, impact Millennials and younger generations more than older groups.
Experts say that Millennials and younger generations seem to be less worried about inflation and supply shortages than older generations. That’s because the younger generations don’t have the memories of baby boomers the last time that rapid inflation was a worry. [The New York Times]
- Even Dollar Tree couldn’t avoid a price hike. The discount chain that for many years committed to selling nearly everything for $1 announced price increases for most items to $1.25. Dollar Tree plans to roll out the price increases in early 2022.
For several months, Dollar Tree has been testing higher-priced items of $3 and $5 in its Dollar Tree Plus stores. The company plans to return some items to shelves that had previously been priced out in order to abide by the $1 restriction. [NPR]
- Get your Christmas tree early! According to the American Christmas Tree Association, this year’s supply of real Christmas trees has been heavily impacted by the heat and wildfires in the Pacific Northwest. Artificial trees, meanwhile, are being impacted by the logjams facing many of the supplies imported from overseas.
Prices for Christmas trees, including real and artificial, are anticipated to increase 10 to 30 percent over a year ago. The Pacific Northwest produces roughly 25 percent of the nation’s supply of real Christmas trees, and the region is down an estimated 10 percent of its supply. [The Washington Post]