Many Complain About Inflation Because They Feel The Need For Lavish Celebrations

Well it’s the -ber months and is it me or is the Christmas season in the Philippines much longer? It seems to be the real problem that when September 1 strikes — the very mind of many Filipinos thinks of Christmas more than the other occasions of September to November. December is supposedly the Christmas season yet people think of Christmas when September arrives. Now, with the news of inflation coming and kicking in (and yes, there’s also the bad habit of blaming incumbent presidents for it and not just in this administration) — people are now getting worried and complain about the fact that stuff that are used for the annual Noche Buena Dinner are now getting more expensive.

Unfortunately, here’s the reality about inflation. It’s not a problem exclusive in the Philippines. I even heard of how President Rodrigo R. Duterte is considering on suspending gasoline excise tax due to the real problem of the world market’s increase of gasoline prices to help minimize inflation. When gasoline prices increase then you must expect prices of goods to increase. Just some time ago — I also remembered how I wrote about how prices of gasoline actually cost higher in other developed countries which may explain why their products cost more. Part of the problem is the cost of transportation is associated with the cost of gasoline. Also, worldwide currency exchange rates are also part of the problem. If there’s going to be a trade war between economic powers then expect economic impact around the world. If the U.S. dollar or any big playing foreign currency is going to strengthen or weaken then expect the Philippine peso to appreciate or depreciate along with it.

Now what’s another real issue of inflation or the increase of prices? Do we even keep thinking about the supply and demand cycle? Since it’s the Christmas season and if there’s too much demand for certain stuff for the season such as stuff to prepare for the annual Christmas dinner, Christmas decorations and Christmas presents then can you be sure that the supply can meet the demand? If supply is low and demand is high then that would lead to inflation. Sometimes, a Christmas sale is done to get rid of some items while brand new stuff will always expensive. When you buy brand new then expect it to be expensive. If you buy something a year or two later — you can expect prices to drop because of the principle of the economies of scale. By then, the cost of producing the later units had led to a surplus where there’s higher supply and lower demand.

Another problem in the Philippines is that there’s the tendency to be lavish in several levels of stupid. It reminds me of how celebrations don’t need to be super extravagant. Ever heard of the economic principle of substitutes? It’s like if one whole lechon baboy will be too expensive then why not get less? Sometimes, I even think about celebrating with lechon manok instead of lechon baboy. You can also opt for more affordable dishes. Also, why do you need to have a very huge Christmas party when you don’t have that much money? Don’t invite too many people if you can’t afford. Having a small party serving some cheaper yet delicious food with selected relatives without all the unnecessary idiocies like hiring a music band is a good celebration.  Unfortunately, the demand for too much stuff to be used on the Christmas parties is also contributing to the inflation or the increase of prices. Ever noticed that the prices of commodities tend to increase during the Christmas season? As said, the basic principle is that these lavish celebrations contribute to the demand and the supply may not be enough to meet both ends.

When it comes to celebrating any occasion — think of the principle of celebrating based on a realistic budget. That would be making sure that after the celebration that you will still have plenty of money left to meet for the rest of the year. If you want to borrow money then make sure you can pay for it. Unfortunately, is it me or is the concept of savings really disregarded as being “un-Filipino” when it shouldn’t be? It should’t be because saving one’s money as a rainy day should be viewed as not exclusive to any nationality.

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