08 Jun Disney Price Rises a Harbinger?

Disneyland and Disney World recently raised their ticket prices to $95 for adults and $89 for a one-day visit to their parks. Of course they do it in part to encourage you to buy multi-day park hoppers which reduce the daily price almost in half. Or if you go there more than 5 days it actually pays to buy an annual pass. How do I know all this? My family’s been going there for well over 20 years pretty much every year. Their trick: Go in August and stay for a few weeks, buy an annual pass and do the same the following July, but with the same annual pass.

This is nothing new, as they have raised ticket prices every year for the last 10. But breaking the $90 barrier was a big deal, though Universal Studios next door already surpassed it. And while the media have been all over this, I don’t know that this is some warning that massive inflation is about to hit the US. Theme parks have been a critical part of Disney’s profit. The demand is there, though the parks do get hit during recessions.

Prices of things have been rising steadily for decades, during times of inflation and not. A successful doctor in the 1960s made $50,000. In the 1980s when I came out of law school top firms were paying starting salaries of $50,000, now they pay $160,000. Thus as costs rise so have most wages. There are times when inflation rises enough that there is demand to push wages up to meet it, which then creates the famous wage/price spiral. As we know I’m no economist, but it seems that the Fed’s economic policy will continue to keep interest rates and inflation low for the foreseeable future. What do you think?