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A better headline: most US workers had no choice but to accept the pandemic profiteering of corporations that have little, if any, competition, leading them to

A better headline: most US workers had no choice but to accept the pandemic profiteering of corporations that have little, if any, competition, leading them to raise prices for no reason other than shareholder rewards and stock buybacks. We talk about inflation as if it is some law of nature or some ethereal boogeyman. It's giant corporations deciding that muH suPpLy ChAiN DisRUpTiOn is a great excuse to paper over their own greed. This last round of earnings calls have been nuts. So many times, the answer of "why are you raising prices when our profit margins are so high?" is always some corpspeak version of "cuz we can".

kortilla 5y ago
But profit margins haven’t expanded…
- smt88 5y ago
  That is untrue. Corporate profits exploded shortly after the pandemic began. https://fred.stlouisfed.org/series/CP https://fred.stlouisfed.org/series/CP
  - missedthecue 5y ago
    He said margins. Your link doesn't refute his point.
    - smt88 5y ago
      My link does refute that point because it considers corporate profits as a percentage of GDP. That factors in costs, not just revenue, because paying employees (or buying supplies) is part of GDP. Here's a link that also shows profit margins going up a lot: https://www.bea.gov/data/income-saving/corporate-profits https://www.bea.gov/data/income-saving/corporate-profits
      - VirusNewbie 5y ago
        That word doesn't mean what you think it means.
dominotw 5y ago
then why can't we just buy stock in these companies making mad money and get rich ourselves.
kube-system 5y ago
The products and services with the greatest increase in prices are all categories in which supply has been greatly disrupted, or demand has boomed due to lifestyle changes. There’s no conspiracy here, just basic economics.
VirusNewbie 5y ago
None of this is true, I'm sad to see such a misunderstanding of basic facts on HN of all places. To actually believe something as stupid as you're claiming, you'd have to assume that the giant corporations suddenly decided to crank the greed knob in lockstep with a massive amount of money being printed in the last two years. On top of that, you'd also have to assume that housing (which is in no significant way controlled by corporations) coincidentally skyrocketed at an unprecedented rate at the exact same time (along with equities) caused by a completely separate mechanism.
- SamoyedFurFluff 5y ago
  > you'd have to assume that the giant corporations suddenly decided to crank the greed knob in lockstep with a massive amount of money being printed in the last two years I mean, corporations are understood to behave as greedily as they can get away with.
  - fundad 5y ago
    Corporations operating in lockstep to maximize profits is just how businesses work. It was obvious when Republicans and MSM were setting the expectation for inflation. People defended the price hikes during the trade war as “pain for some gain” but it was a president that entertained them so it was ok.
- amilios 5y ago
  What you're ignoring is that a large proportion of the money printed (trillions) went towards "corporate welfare", inflating the profits of the very companies who then turned around and told their employees "sit tight we're tightening the purse strings due to the pandemic, no raises for you we can't afford it"
- neilwilson 5y ago
  The empirical evidence supports that view - once you drop below the aggregate [0] Housing increases in price because the market doesn't produce enough housing to go around. During the pandemic we saw the price of Used cars start to rise and behave like housing normally does. Did we call that 'inflation', or did we say 'we need to produce more cars'. That housing increases in price is the sign of an oligopoly, not inflation. Smash the oligopoly, distribute the work around the country and build sufficient houses so that houses depreciate in value and that will fix that particular problem. As it does with cars. [0] https://economicsfromthetopdown.com/2021/11/24/the-truth-about-inflation/ https://economicsfromthetopdown.com/2021/11/24/the-truth-abo...
missedthecue 5y ago
Academics refer to this phenomenon as the "greed cycle". https://i.imgur.com/WZz3pIX.jpg https://i.imgur.com/WZz3pIX.jpg
- foxyv 5y ago
  Oooh, that is interesting. Thank you!

kortilla 5y ago

But profit margins haven’t expanded…

smt88 5y ago
That is untrue. Corporate profits exploded shortly after the pandemic began. https://fred.stlouisfed.org/series/CP https://fred.stlouisfed.org/series/CP
- missedthecue 5y ago
  He said margins. Your link doesn't refute his point.
  - smt88 5y ago
    My link does refute that point because it considers corporate profits as a percentage of GDP. That factors in costs, not just revenue, because paying employees (or buying supplies) is part of GDP. Here's a link that also shows profit margins going up a lot: https://www.bea.gov/data/income-saving/corporate-profits https://www.bea.gov/data/income-saving/corporate-profits
    - VirusNewbie 5y ago
      That word doesn't mean what you think it means.

dominotw 5y ago

then why can't we just buy stock in these companies making mad money and get rich ourselves.

kube-system 5y ago

The products and services with the greatest increase in prices are all categories in which supply has been greatly disrupted, or demand has boomed due to lifestyle changes. There’s no conspiracy here, just basic economics.

VirusNewbie 5y ago

None of this is true, I'm sad to see such a misunderstanding of basic facts on HN of all places. To actually believe something as stupid as you're claiming, you'd have to assume that the giant corporations suddenly decided to crank the greed knob in lockstep with a massive amount of money being printed in the last two years. On top of that, you'd also have to assume that housing (which is in no significant way controlled by corporations) coincidentally skyrocketed at an unprecedented rate at the exact same time (along with equities) caused by a completely separate mechanism.

SamoyedFurFluff 5y ago
> you'd have to assume that the giant corporations suddenly decided to crank the greed knob in lockstep with a massive amount of money being printed in the last two years I mean, corporations are understood to behave as greedily as they can get away with.
- fundad 5y ago
  Corporations operating in lockstep to maximize profits is just how businesses work. It was obvious when Republicans and MSM were setting the expectation for inflation. People defended the price hikes during the trade war as “pain for some gain” but it was a president that entertained them so it was ok.
amilios 5y ago
What you're ignoring is that a large proportion of the money printed (trillions) went towards "corporate welfare", inflating the profits of the very companies who then turned around and told their employees "sit tight we're tightening the purse strings due to the pandemic, no raises for you we can't afford it"
neilwilson 5y ago
The empirical evidence supports that view - once you drop below the aggregate [0] Housing increases in price because the market doesn't produce enough housing to go around. During the pandemic we saw the price of Used cars start to rise and behave like housing normally does. Did we call that 'inflation', or did we say 'we need to produce more cars'. That housing increases in price is the sign of an oligopoly, not inflation. Smash the oligopoly, distribute the work around the country and build sufficient houses so that houses depreciate in value and that will fix that particular problem. As it does with cars. [0] https://economicsfromthetopdown.com/2021/11/24/the-truth-about-inflation/ https://economicsfromthetopdown.com/2021/11/24/the-truth-abo...

missedthecue 5y ago

Academics refer to this phenomenon as the "greed cycle". https://i.imgur.com/WZz3pIX.jpg https://i.imgur.com/WZz3pIX.jpg

foxyv 5y ago
Oooh, that is interesting. Thank you!