Economists in the government are some of the most callous people in the world. When calculating inflation, they take out changes in food and fuel in order to stabilize the monthly and annual inflation numbers. The numbers in this 'core index' are then bandied about across the media as the true inflation rate.
That may work well and fine for your favorite international corporation operating out the local Death Star, but for regular people, food and fuel are some of the biggest parts of their budget. Hence the disconnect between the low inflation numbers in the media and your wallet that seems to magically eat a few extra twenty dollar bills each week.
The situation in the country as a whole is getting pretty crazy, especially as oil prices start to nip at the heels of the embargo-level prices of the 1970s. But here in New York City, the cost of living is getting almost surreal.
Another quick lesson in inflation: Like unemployment, it is an incredibly regionalized phenomenon. Not only will prices vary from region to region, but from city to city. There will even be large variances in the inflation rate of different neighborhoods of a city.
So, as real estate prices, food prices, subway prices - basically every type of price, besides the prices it costs to employ someone... also known as wages - continues to go up, more and more people are getting priced out of the parts of New York City they want to live in. Indeed, census data indicates that the cost of living in New York City has gone up an incredibly painful 90% in the last twenty years.
The largest part of that jump has come from housing, which has increased 106% during that same time frame. With spending on residential building up about 14% this year alone, more apartments are being built this year than last year, but not nearly at a rate fast enough to keep up with the increase in demand, especially in Manhattan.
So what's going to happen? One is inclined to think that people will continue to get by, like they always have. People might have to work a bit longer, and commute just a bit longer, but the city will look basically the same in thirty years as it does now.
It's a funny difference:In most American cities, the term 'inner city' is associated with the poorest parts of an urban area. In Paris, though, the poorest parts are the outer suburbs that ring around the city. There are numerous reasons for this, but one of the more important is simply that Paris has been around a whole lot longer than any American city.
The poor and even middle class are often priced out of the center of cities, until that city 'center' becomes the whole city, and workers are
relegated to long commutes into the city and back out again at night.
My suggestion? It may be expensive now, but it's only going to get more expensive. So if you want to live in Manhattan or any other central part of New York City, as crazy as it sounds, now is as good as it is going to get. New websites like CityCribs.com makes the process of finding a New York apartment much easier than it used to be.
