Salience: Why Frequent Purchases Skew Perception

Mike explains salience effects using coffee and gas prices to show why visible items alter inflation views.

Play episode from 05:06

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Transcript

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Transcript

Episode notes

If inflation is only around 2–3%, why does everything feel so much more expensive?

In this episode, we break down how inflation is actually measured, and why your personal experience can feel completely disconnected from the official numbers. From grocery bills and gas prices to rent and mortgages, not all price increases hit the same way—and some matter a lot more than others.

We also dig into the hidden forces shaping your cost of living: shrinkflation, quality drops (“chocolatey” vs. chocolate), and the limits of how agencies like Statistics Canada track price changes. The result? A single inflation number that masks wildly different realities depending on how you live, spend, and earn.

In other words: there isn’t one inflation rate. There are millions.

Chapters

00:00 Intro: Why We Underestimate Inflation

00:28 Official Stats vs. Public Perception

01:20 Breaking Down the "Spending Basket"

02:07 Why Every Family Experiences Inflation Differently

03:33 Why Reading & Media Prices are Dropping

04:04 Biggest Price Jumps & Surprises

05:56 The Reality of Shrinkflation at the Grocery Store

06:46 The Kraft Dinner Test: Smaller Sizes, Same Price

07:43 Cutting Ingredients: Chocolate vs. "Chocolaty"

09:03 Housing & Shelter Inflation