As an SME it’s always good to research things to get a picture of what is going on in the world and how things will affect us in the future. What triggered my interest was the recent announcement that the inflation rate isn’t coming down as expected given that the Bank of England has for several months increased interest rates, could there be something else behind it?
Our business is being affected by energy prices compared to those who do not undertake refurbishment as we also have large premises for storage and the workshops, even though we invested in low-energy LED lighting throughout last year. Material costs we use have risen in price as have our living expenses but we are making savings everywhere possible to combat these inflationary costs.
The current high inflation in the West that we are all experiencing was always expected due to the creation of printed FIAT currencies (QE) by our governments during the Pandemic. This inflation has and will affect the demand for no essential goods and services but since the pandemic, governments in the West are still spending much more every month than they take in taxes, so how can inflation not become embedded?
So what else could be driving inflation?
According to the U.S. Bureau of Labour Statistics, prices for tools, hardware, and other supplies are 23.28% higher in 2023 versus 1997. Between 1997 and 2023: Tools, hardware, and other supplies experienced an average inflation rate of 0.81% per year.
This doesn’t sound so bad, does it?
Well, this is progress we are told, this is what drives prices down, but if we think about the rise of cheap Chinese goods flooding the market during this time and the export of most manufacturing, did the West simply defer inflation?
Let’s take a close look at the inflation of tools, hardware, and other supplies by breaking it down over the past few years.
According to the U.S. Bureau of Labour Statistics, prices for tools, hardware, and supplies were 2.14% lower in 2017 versus 1997. Between 1997 and 2017: Tools, hardware, and supplies experienced an average inflation rate of -0.11% per year.
According to the U.S. Bureau of Labour Statistics, prices for tools, hardware, and supplies are 25.98% higher in 2023 versus 2017. Between 2017 and 2023: Tools, hardware, and supplies experienced an average inflation rate of 3.92% per year.
According to the U.S. Bureau of Labour Statistics, prices for tools, hardware, and supplies are 18.09% higher in 2023 versus 2021. Between 2021 and 2023: Tools, hardware, and supplies experienced an average inflation rate of 8.67% per year.
As you can see there was a 20-year period where these goods actually dropped in price year on year, true inflation started in 2017 at a relatively slow rate but has accelerated over the past two years. These last two years have also seen a demand drop from the heights of the pandemic when people were at home with their free furlough cash and much lower expenses.
Premium brands such as Lie Neilson when using a time stamp internet search some of their planes have more than doubled in price in the period of 2012-2023 which better shows the true inflation rates of the West.
So it looks to me the West exported most of its inflation caused by Government printing presses but they still managed to reach their annual 2% inflation targets. It’s quite a dereliction of duty by politicians who are lobbied heavily by globalist crony corporate capitalists who have yet to raise their greedy snouts from the trough.
So what’s happening in these manufacturing-based countries?
The BRICS+ Nations as they are now known are moving towards de-dollarisation with a gold-backed currency. Are they really going to accept our FIAT currencies at face value? and has the age of disposable goods seen its day? Good whilst it lasted for some but now we have a nation dependent on quick consumption fixes, loss of skills, and dependency on cheap Eastern manufactured products.
The question is “At what cost?” and will the worm turn?
Given the record of administrations such as China for their own people do you really think they will think twice about not turning the screw on the West?
Could it be the end of an era, one we will look back upon as wasteful and indulgent, and one that reshaped the global balance of transferring wealth from the rich to the poor nations?
Whatever happens and what is about to occur, when it comes to a wealth of knowledge and practical skills these have a direct impact on the quality of our own lives. Maintaining quality tools for life rather than relying on disposable types is an intrinsic part of this knowledge. We have shown this for many years now by reversing the effects of wear and time to breathe new life into many old hand tools that have stood the test of time. No plug is required with these tools, only some elbow grease but it can counter what looks to be a carbon-accountable future, monitored by the powers that be through CBDCs. The establishment won’t admit this of course but like most things, they say, it will encroach slowly on the very rights they said it wouldn’t affect.
Having been through the pandemic and the inflation of used tool prices we are finding people are still asking elevated prices for their old tools, this hasn’t changed. Some online auction prices (eBay) for old tools online have dropped due to lower demand and auctions are NOT the way to sell old tools.
New tools have risen in price due to higher manufacturing and transportation costs and as we have explored this looks to be an upward trend that will eventually also impact the used tool market again.
So we as a business are not immune from inflation costs and it’s not having any positive effects on our business, however, please be assured that this will have no impact on our standards as we try to remain competitive.
We hope before and during the pandemic we showed our valued customers our ethics of prioritising the quality of our service rather than just focusing on achieving higher sales. We are in this for the long haul and we hope many will continue to support us to support them with their used tool needs.