Exactly. When labor costs gets high enough, then companies invest in automation. Higher labor costs change the payback on the investment. It’s why UAW factories need 1/10th the number of workers they needed decades ago.
At least now there’s such a shortage or workers that I’m not sure this would displace large numbers of them.
Self service kiosks of MCD are difficult to use, orders are too configurable. Costco ones are way easier, two clicks to complete a purchase.
Restaurants are rapidly automating, layout of restaurants need to redesign and recipes need to be simplified for more effective automation. Surprisingly many restaurants still don’t have an efficient online ordering and delivery system.
I think most people get the same thing at restaurants. Once they let you pre-save your order, then it’ll be super fast. The Chik-fil-a app has that.
Red Robin has sit down with App/Console based ordering. It’s been a while since I went there, but from what I can remember. Also, Olive Garden.
Plopping this here as it seems the right place:
Rand Paul calls for responsible Fiscal spending:
Fiscal and monetary policy are at war.
I don’t fully understand what QT (quantitative tightening) means for common people and businesses. Does that mean there is less money that can be borrowed overall? Can someone please elaborate? Thanks. @marcus335 @manch
The real impact is it increases interest rates by removing a buyer of bonds. Banks sat in a lot of the money supply, so it never made it into the economy. I think they’d have to tighten a lot before there’s an impact due to supply.
They have documentation that explains what all the numbers are.
It means the cost of capital will be higher. Think mortgage rate. It used be cost 2% interests a year to borrow 1M, now it costs 6%. A lot of purchases (think big houses and fancy cars) no longer pencil out at such a high cost of capital. For businesses the hurdle rate for new projects and new hires is now much higher. They need to make sure returns are high enough to at least cover the interests.
JPow won’t be satisfied until…
How? I am jobless?
Good for retirees. Goods and services get cheaper. Earnings and dividends are impacted less than share price so if you have cash to invest you get those earnings and dividends on the cheap.
“Industry estimates range from 13.7 million to 13.9 million new vehicles being sold last year in the U.S., a roughly 8% to 9% decline compared with 2021 and the lowest level since 2011 when sales were recovering from the Great Recession.”
Higher interest rates kill car sales. The publicly traded used car dealers are getting crushed too.
Nothing makes me happier than to see car dealers being crushed. They made a mint gouging people during the pandemic. My friend who owns a Lexus dealership in Mission Viejo was laughing all the the way to bank. Didn’t care about low sales volume. Just raised his markups. Less work and more money coming in… time to pay the piper. Karma is a bitch. Maybe Biden will bail them out also
I have been shopping for a new car… prices are dropping. Probably not 50% like our resident troll picks for RE prices. But 20% would make me buy.
Sometimes the truth hurts. ‘Free money’ all around is not sustainable – as usual Larry is right.
Paul Krugman is soothing to the soul, however he’s always wrong.
