business news in context, analysis with attitude

With brief, occasional, italicized and sometimes gratuitous commentary…

•  Community Impact reports that in Austin, Texas, "after more than six decades, the H-E-B at South Congress Avenue and Oltorf Street will be demolished and rebuilt.

"The H-E-B, located at 2400 S. Congress Ave., originally opened in 1957 and spanned 25,000 square feet at its inception … It was later expanded to 69,000 square feet.

"That store will be demolished to make way for a new, 145,000-square-foot facility at the same location. H-E-B will open a temporary store located at the adjacent Twin Oaks Shopping Center, according to the press release.

"Construction on the new facility is expected to take two years to complete."

The Austin American-Statesman notes that the location will include {shopping and restaurant space and above-ground parking, the company said. It will feature indoor and outdoor seating for dining and an outdoor stage for live performances.  The store will also include curbside and home delivery services and a full-service pharmacy with drive-through service. In addition, it will have a True Texas BBQ, which is H-E-B's in-house barbecue restaurant brand."

•  From the Wall Street Journal, a story suggesting that anti-globalization trends may be in part responsible for the inflation that is plaguing the markets:

"While supply-chain disruptions, labor shortages and fiscal stimulus have all been blamed for the rise in short-term inflation, another long-term force could also be at work: 'deglobalization.'

"Economists and policy makers have long argued that globalization helped to lower prices. As trade barriers fell, domestic companies were forced to compete with cheaper imports. Technology and trade liberalization encouraged  businesses to outsource production to low-wage countries. Generally liberal immigration policies allowed many lower-wage workers to move to richer countries, although the link between immigration and wages isn’t clear-cut.

"That pattern might reverse as the pandemic speeds up the retreat from globalization that has been under way for several years. While supply-chain bottlenecks should eventually ease, other trends could persist - protectionist policies such as tariffs and 'Buy American' procurement rules, businesses moving production back to the U.S. where it will be less vulnerable to those policies, and depressed immigration inflows."

I have to wonder if these forces and resultant inflation will make our culture come to grips with what things actually cost, as opposed to what we've been persuaded through canny marketing and ubiquitous supply what we think things cost.

•  From the New York Times this morning:

"Infusions of government cash that warded off an economic calamity have left millions of households with bigger bank balances than before the pandemic — savings that have driven a torrent of consumer spending, helped pay off debts and, at times, reduced the urgency of job hunts.

"But many low-income Americans find their savings dwindling or even depleted. And for them, the economic recovery is looking less buoyant.

"Over the past 18 months or so, experts have been closely tracking the multitrillion-dollar increase in what economists call 'excess savings,' generally defined as the amount by which people’s cash reserves during the Covid-19 crisis exceeded what they would have normally saved.

"According to Moody’s Analytics, an economic research firm, these excess savings among many working- and middle-class households could be exhausted as soon as early next year — not only reducing their financial cushions but also potentially affecting the economy, since consumer spending is such a large share of activity."

•  The Los Angeles Times reports that Jack in the Box plans to acquire Del Taco for $575 million, including the assumption of debt.

"The acquisition brings together two Southern California fast-food restaurant brands. The combined companies aim to increase profit margins through increased bulk-buying power and deliver $15 million in cost savings over the next two years.

"In addition, the merger allows Jack in the Box franchisees to tap a Mexican brand concept to add restaurants — perhaps at lower development costs and with better competitive market dynamics in certain cities."