In a normal free market system if your costs of production go up you raise your price.

There's no such thing as a normal free market system.

It's like pre-Copernican astronomy - the planets move in circles, but there are epicycles which predict the real orbit. Even so - the planets really move in circles, and the rest is just details.

Only - not.

Economics won't start to make sense until there's a realisation that markets are seriously fucking stupid herd psychology at the best of times, and outright Marie Antoinette special pleading at worst.

Expecting them to be rational, predictive or sane - never mind socially literate - is like trying to have an argument with a drunken moose.

The very idea of markets should be a philosophical embarrassment along the lines of Phlogiston, Lysenkoism and really bad boy bands.