RICHMOND, Va. -- Making it through the week has become increasingly harder as inflation rates and rising costs show no signs of letting up soon. With a potential recession on the way, Richmonders said they're making adjustments to their budgeting, but economy experts have warned it could make matters worse.
Matt Cervantes, a resident of Richmond's East End, took a trip to The Market at 25th Tuesday with a critical mission in mind.
“I just came to pick up a few things. I'm trying to make a good tuna sandwich," Cervantes said. "It’s a girlfriend request so I had better get out here.”
While picking up the essentials, he couldn't help but become baffled by the prices.
“They keep going up. It’s insane. It’s like, why are pickles $4? I feel like I can’t leave the grocery store without spending $100 every time for three days of food," he said.
It's not just groceries breaking the bank but also gas, housing, entertainment and everything in between. Cervantes said the expenses have forced him to adjust his lifestyle.
“We're looking into buying an electric car. We started our own garden," he explained. “It seems like a crisis point. I feel helpless."
Chaya Braxton, who stopped into the market to pick up lunch, said she feels the pinch too.
“I think it has really caused me to take a deeper look at the future and how I save and invest and spend," Braxton said.
However, her deepest concerns aren't for herself, but for others in her community who have been more significantly impacted by the state of the economy.
“When you think about rising prices, you consider people who may not be able to afford, you know, their lives," she said.
CBS 6 asked Old Dominion University economics professor, Bob McNab, "What's happening right now?"
“Well, what’s happening is all our economic models turned out to be wrong," McNab responded.
He explained international external factors from COVID-19 supply chain shocks, to inflation, to the Russian invasion of Ukraine have raised the costs of living everywhere.
“This is not a U.S. problem. It's not a Virginia problem. It's a global, economic shock," he said. "It's higher in Germany, it's higher in the United Kingdom, it's higher in Japan, it's higher in China, everywhere. Everybody is facing the same type of price shock, and it's just literally no fun."
The economic shock then created a psychological shock, according to McNab.
"Consumers are feeling a large amount of pain right now, and that really is deflating consumers' expectations and sentiments about the economy. In other words, people are feeling worse about the state of the economy, and they're acting as if the state of the economy is getting worse."
But as Americans stop spending and start saving, McNab said that'll only make matters worse.
"In doing so, they actually help increase the chance of recession actually occurring," he said.
"What do you think that chance is?" CBS 6 asked.
“Right now, I would say we’re looking at a 1-in-3 or 1-in-2 chance of a recession in the next 12 months," he responded.
McNab said people have gone back to work at pre-pandemic levels, but because everything is more expensive now, they've demanded more money from the boss.
“Unemployment is really low. Job openings are really high, and people are quitting at record rates. Why? Because they're leaving jobs in search of higher wages and salaries," he said.
McNab also wanted to clarify a common misconception that it is President Biden's fault for rising gas prices.
"Presidents don't control gas prices. Presidents really don't control as much as people think. Remember, Congress appropriates so at the end of the day, the president proposes actions. Congress disposes. They decide that actually happens," he said. "So if you think a president has lots of control over gas prices in the short term, you're probably sadly mistaken."
Until relief comes, Richmonders including Cervantes and Braxton said they'll continue to roll with the punches.
“I just kind of just live day by day at this point," Cervantes said.
“It will get better. I hope so," Braxton said
