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It really doesn't help when you see a constant barrage of headlines that read "Corporation X is raising prices 10% due to inflation." headline next quarter:
by jandrese 5y ago
It really doesn't help when you see a constant barrage of headlines that read
"Corporation X is raising prices 10% due to inflation."
headline next quarter:
"Corporation X announces 10% profit margin growth despite inflation pressures."
This is happening every day now. Corporate profits are at record highs across the economy. It's hard to take them seriously when they are crying about workers demanding raises and increases in raw materials when they are posting the largest profit margins in history.
https://www.reuters.com/business/investors-watch-us-companies-record-profit-margins-costs-rise-further-2021-09-22/ https://www.reuters.com/business/investors-watch-us-companie...
- dahdum 5y agoProfit is a lagging indicator, you can't set your prices based on what supplies used to cost and expect to stay in business. My local pizzeria had their best 2 years ever during the pandemic, yet they still raised their prices this year due to labor and supply cost. I can't really fault them for not wanting to lose a bunch of money this year to somehow make up for that.
- willis936 5y agoYou're describing a static profit margin scenario, which is not what we're observing with the largest companies with the highest profits. https://www.yardeni.com/pub/sp500margin.pdf https://www.yardeni.com/pub/sp500margin.pdf