[rdcbn1]

This is true. It is also true that many of the people who buy Ferraris have to make a living. When everything costs 10-20% more, they have less discretionary income to spend and their spending habits are impacted by sticker shock. So the incomes of people who have business impacted by the tightening and sticker shock drop radically. Maybe even crash. Example - McDonalds has just raised the price of large fries to $4.75. The sticker shock causes you to cancel your order and stop buying the fries altogether. Gonna see a lot of contraction as people just stop buying discretionary items to concentrate on necessities

[Flick Lives]

Example - McDonalds has just raised the price of large fries to $4.75.

Wow! That’s crazy.

[blam]

"McDonalds has just raised the price of large fries to $4.75."

Burger King charged me an extra $1.50 for extra onions and pickles on the burger. 'Having it your way' is gonna cost you these days.

[cgbg]

Good post—even well to do folks will resist purchases they can easily afford if they feel they are getting ripped off...

Even if the price rises are permanent it can sometime take many months and sometimes years before there is consumer acceptance of the “new normal”.