Cadburys Shrinkflation Takes a Bite Out Of Your Budget

ECONOMICS - The purchasing power of money is falling due to what is called 'Shrinkflation'. Products shrink in size and your money buys less content. Cadburys are shrinking their chocolate bars yet charging the same price. 

The Rule of 72 is a simple way to determine how long an investment will take to double given a fixed annual rate of interest. By dividing 72 by the annual rate of return, investors obtain a rough estimate of how many years it will take for the initial investment to duplicate itself. It works the other way. Divide the rate of inflation by 72 and it tells you the time it will take in years for inflation to halve the purchasing power of money. 

All money is borrowed into existence. The amount of money in the economy equals the amount of goods and services sold. The Chancellor has borrowed 100 billion to fund the COVID-19 issues but that increases the money supply. There will be a lot of downward pressure on prices due to a recession but expect to see the value of money and what it will purchase fall. Intelligent investors are putting money into art, collectables, gold and silver. 

At least a pint of beer has not shrunk.

ABC Comment, have your say below: