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There's a reason why corporate profits are at all time highs. they're just pushing any inflation related costs and more directly to consumers and scraping even

There's a reason why corporate profits are at all time highs. they're just pushing any inflation related costs and more directly to consumers and scraping even more profit off the top. This is actually just not even controversial, completely supported by data. https://fred.stlouisfed.org/series/CP https://fred.stlouisfed.org/series/CP

themitigating 4y ago
I can't believe you're being downvoted
hellojesus 4y ago
That may be the case, but that should allow a new competitor to come in and offer lower priced goods.
- metadat 4y ago
  Yeah, starting a new local grocer or even national grocery chain is pretty easy, right? Why don't you lead the charge.
  - hellojesus 4y ago
    Because I have no incentive to do so? I could, certainly, but until this deal proves rotten there is no impetus for action.
coldcode 4y ago
If they were at all time highs the stock market would not be done so much.
- fzeroracer 4y ago
  The stock market hasn't been connected to reality for years. Companies which produce nothing and are deep in debt have high stock value purely on basis of speculation. Most companies that report layoffs, tough times etc also report record levels of profit because it's not enough to be profitable, you have to go well above and beyond profit. You have to squeeze out everything even at the cost of short term stability.
  - lotsofpulp 4y ago
    Which companies that produce nothing and are deep in debt have shown growth in market cap? From what I can tell, the biggest gains have been at companies that have very strong profits and prospects due to high barriers of entry to their business, and the companies with steady but small profits do okay, and the companies not earning any profits have shown losses.
lotsofpulp 4y ago
Why would you not expect nominal profits to be at all time highs if the purchasing power of the currency goes down? Nominal profits would have to increase for profit margins (which are already low single digits for grocery stores) to be maintained.
- jrmg 4y ago
  You’re being downvoted and all you’ve done is state fact! Are _margins_ increasing (I don’t know) - because that would be the required condition to conclude nefariousness.
- refurb 4y ago
  Hilarious what gets downvoted on HN. Inflation since Jan 2020 is 15% according to BLS. If corp profits go up 15% the real profit increase is 0%
- lupire 4y ago
  People are upset that wages aren't keeping up with inflation, but profits are. The rest is bad expression of that idea.
  - lotsofpulp 4y ago
    Some businesses’ profits are keeping up with inflation, and some are not. Grocery stores sell relatively inelastic goods at already low profit margins, so there is not much room to not keep up with inflation. The other option for them would be going out of business.
- adamsmith143 4y ago
  > Why would you not expect nominal profits to be at all time highs if the purchasing power of the currency goes down? Purchasing power doesn't magically decrease, it's a function of increasing prices. Think about for a little. If a companies input costs have increased by 10% their profit will decrease right, maybe not by 10% but it will decrease. So if they increase their prices they can get back to their previous profit level. Instead they have increased prices even more such that their profit is HIGHER than it was before inflation. QED

themitigating 4y ago

I can't believe you're being downvoted

hellojesus 4y ago

That may be the case, but that should allow a new competitor to come in and offer lower priced goods.

metadat 4y ago
Yeah, starting a new local grocer or even national grocery chain is pretty easy, right? Why don't you lead the charge.
- hellojesus 4y ago
  Because I have no incentive to do so? I could, certainly, but until this deal proves rotten there is no impetus for action.

coldcode 4y ago

If they were at all time highs the stock market would not be done so much.

fzeroracer 4y ago
The stock market hasn't been connected to reality for years. Companies which produce nothing and are deep in debt have high stock value purely on basis of speculation. Most companies that report layoffs, tough times etc also report record levels of profit because it's not enough to be profitable, you have to go well above and beyond profit. You have to squeeze out everything even at the cost of short term stability.
- lotsofpulp 4y ago
  Which companies that produce nothing and are deep in debt have shown growth in market cap? From what I can tell, the biggest gains have been at companies that have very strong profits and prospects due to high barriers of entry to their business, and the companies with steady but small profits do okay, and the companies not earning any profits have shown losses.

lotsofpulp 4y ago

Why would you not expect nominal profits to be at all time highs if the purchasing power of the currency goes down? Nominal profits would have to increase for profit margins (which are already low single digits for grocery stores) to be maintained.

jrmg 4y ago
You’re being downvoted and all you’ve done is state fact! Are _margins_ increasing (I don’t know) - because that would be the required condition to conclude nefariousness.
refurb 4y ago
Hilarious what gets downvoted on HN. Inflation since Jan 2020 is 15% according to BLS. If corp profits go up 15% the real profit increase is 0%
lupire 4y ago
People are upset that wages aren't keeping up with inflation, but profits are. The rest is bad expression of that idea.
- lotsofpulp 4y ago
  Some businesses’ profits are keeping up with inflation, and some are not. Grocery stores sell relatively inelastic goods at already low profit margins, so there is not much room to not keep up with inflation. The other option for them would be going out of business.
adamsmith143 4y ago
> Why would you not expect nominal profits to be at all time highs if the purchasing power of the currency goes down? Purchasing power doesn't magically decrease, it's a function of increasing prices. Think about for a little. If a companies input costs have increased by 10% their profit will decrease right, maybe not by 10% but it will decrease. So if they increase their prices they can get back to their previous profit level. Instead they have increased prices even more such that their profit is HIGHER than it was before inflation. QED