When it Comes to Inflation The Rich are Different from You and Me

By Johnny Depth

F. Scott Fitzgerald supposedly observed, “The rich are different from you and me.”

Whether he actually said it that way or not almost doesn’t matter. The point still stands.

I was at a restaurant near the world famous Brazilian Court Hotel in Palm Beach when I noticed something horrifying. The price of a margarita had gone up.

The average economist would call that inflation. The average cable news host would call it another sign that the middle class is being squeezed.

The average Palm Beach resident probably ordered another one without looking at the menu. That’s because the wealthy don’t experience inflation the same way everyone else does.

To most Americans, a $3 increase in the price of a cocktail is an annoyance. To someone worth $100 million, it’s statistical noise. They didn’t stop ordering. They didn’t switch to iced tea. They didn’t write angry posts on social media about corporate greed.

They simply paid the bill. In fact, higher prices often reinforce the image they’re buying in the first place.

You’re not paying $28 for tequila, lime juice, and ice. You’re buying a warm evening under the palms, impeccable service, familiar faces, and the feeling that, for a couple of hours, the rest of the world can wait.

Luxury has never been about value. It’s about experience. That’s one of the biggest differences between Palm Beach and almost everywhere else.

When inflation hits the price of eggs, people complain. When inflation hits the price of a Bentley, a Hermès handbag, or dinner at the Brazilian Court, demand often barely notices. Sometimes it even increases.

Economists have a name for this phenomenon. In certain markets, higher prices can actually make something more desirable because exclusivity has value all by itself.

Palm Beach has understood that concept for generations. Walk Worth Avenue on a Saturday afternoon. Nobody is asking whether the watch, the jewelry, or the designer handbag is on sale. Quite the opposite. For many buyers, paying full price is part of the experience.

That doesn’t mean wealthy people like wasting money. Far from it. Many of the richest people I know negotiate fiercely over million-dollar investments while happily paying an extra five dollars for their favorite cocktail without giving it a second thought.

They know the difference between an expense and friction. Arguing over a margarita creates friction. Making another million dollars is worth the effort.

Perhaps that’s the real lesson. The wealthy don’t ignore inflation because they’re careless. They ignore the small things because they’re focused on much bigger numbers.

Meanwhile, the rest of us spend hours chasing coupons, comparing gas stations, and debating whether happy hour starts at four or five.

Maybe Fitzgerald had it right after all. The rich really are different. Not because they drink more expensive margaritas. Because they rarely let the price of one distract them from enjoying the sunset.