Well, Gov't doesn't seem to be taking it seriously ... perhaps as such, hardly a surprise that on the microeconomic level some consumers may seem to have a cavalier response. Seem. IMV, ppl are going to be "fatalistic" about it because this is part of a continuum for local consumers, rather than an abrupt change of course as may be the case for consumers in the North (to use the language of a bygone era) ... The other factor is interpretation ... how does the average consumer interpret what he or she is viewing relevant to his or her specific situation ... (in other words, I eh too quick to malign Trinis here to say that we're being irrational actors b/c we
appear to be ploughing forward like there is no tomorrow) ... I think, like the individuals I saw on Cnews last night, that consumers have been 'banning' dey belly fuh a while so this is viewed as same ingredients, different recipe ... and as I'll suggest in a minute ... how elastic is "food" anyway?
Outside T&T: Fully in agreement with Barney Frank with respect to the need to bolster public confidence. Paulson has done himself few favours with respect to harnessing that in recent weeks. Investor confidence is equipped to be 'different" from public confidence ... but I think this may be a key in relation to the local economy ... maybe ultimately the external media sources will message better than the local ...
Anyhow, leads to a question raised here a long time ago ... re: relationship of the Central Bank and the Gov't ... I listened to Ewart Brown and I had a sense there was a message in it for the political decision-makers and a message for the public ... only thing with this latter group is ... the message needs to be clearer (Is it the function of the Central Bank to message consumers?)
On the local front, the key paragraphs for me from the linked article are:
He said the main drivers of inflation were the "mind-boggling" record rise in food prices, insufficient agricultural production, Government's rapid development and spending on projects and rapid bank credit expansion. (in sharp contrast to what's happening elsewhere)
Even as food prices have hurtled upward, Trinidadians have continued to spend.
Williams maintained that the country was not in recession as economic growth would continue, albeit at a slower pace and did not contract negatively over the past two financial quarters.
The Central Bank said the worst-case scenario was if oil prices fell below US$40 with a corresponding fall in gas prices.
Williams said: "Obviously addressing such a worst-case scenario would call for a major adjustment in both the public and private sectors. The situation could be significantly more complicated, since adjustment may need to reach to non-discretionary expenditure. If we don't get our act together, we could find ourselves in a much worse scenario."
The one thing I'd say about the article is that it glosses over price elasticity of demand ... the journalist doesn't use this term but dahis what he's discussing in the cereal/veggie/fruits section ... it's somewhat too simple to say that consumers are still spending on these items, without fleshing out the fuller picture.
And well, given the nature of this forum ... how does $500 covered stands/$200 uncovered factor into the mix ... watchnah ... cyah see that atall ... powers that be real challenging discretionary spending
