There's a silver lining to the Great Recession: Prices on everything from coffee to cat food are falling to unheard of levels.
For those who still have jobs, the low prices are a huge boon, and for those who are out of work, paying less for necessities can make it a little easier to get by. Items rarely discounted - like Tiffany engagements rings - are now. The two biggest purchases most people make - homes and new cars - are selling at steep price reductions.
"This is the new normal," says Donald Keprta, president of Dominick's, a supermarket chain in the Midwest, which just cut prices by as much as 30% on thousands of items. "We aren't going back."
Retail sales remain sluggish, and more than half of the people surveyed recently by America's Research Group and UBS said they are shopping less. But when they do shop, most go to stores with lower prices or wait for sales before returning to their favorite retailer, according to the survey.
It isn't just retail prices on everyday items. Hotel rooms cost travelers nearly 20%, on average, than last year, the biggest decline since Smith Travel Research began collecting data in 1987. Home prices have dropped 30% from the peak in 2006. Overall, prices are tumbling at the fastest rate in decades.
The government's Consumer Price Index, which measures the average price of goods and services purchased by households, has fallen 1.5% over the last 12 months. The reading for July showed a 2.1% annual decline, the biggest since 1950.
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