Stealthflation

Browsing around PnP on the weekend, I came across a bottle of head & shoulders that has been reduced in size by 10%, from 200ml to 180ml. Usually businesses don’t promote this sort of thing, so I found the pink advertisement to make the buying public aware, curious.

Product debasement is always a consequence of monetary debasement. In other words, a weak Rand policy amounts to a poor product quality policy. It is also a price inflationary policy. Businesses are cutting product quality and quantity in order to make ends meet, while keeping prices unchanged.

The further you are away from the printing presses of the Reserve Bank, commercial banking system, and government, the harder you will be hit by the inflation.