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The “corporate profiteering” thesis is so blatantly motivated that it shocks me that this is treated as a serious hypothesis. In what world is the massive, mul

The “corporate profiteering” thesis is so blatantly motivated that it shocks me that this is treated as a serious hypothesis. In what world is the massive, multiple waves of stimulus just completely unrelated but instead it’s those greedy corporations who are for some reason no longer bound by price competition.

danaris 4y ago
The stimulus that actually reached people was tiny. It was, what, 2 $2k checks or something? That's about 2 months' worth of income. There is no way in hell 2 months' worth of extra income in 2020 has anything to do with 3 years' worth of inflation.
- AbrahamParangi 4y ago
  Just noticing that 2 months worth of extra income is a 16% increase. Prices between 2020 and 2022 went up by, on average, 16%. Also, payments to individuals and families accounted for only 30% or so of total Covid stimulus! But entities which are not people still spend money! Both on goods, services, and on salaries paid to people who then spend that money on goods and services. It just seems crazy to me to say “no way, it has nothing to do with the $5 trillion dollar stimulus.”
  - danaris 4y ago
    1) I don't recall the details of the aggregate amount of stimulus, but the total stimulus was not the payments to regular people. That was actually only a tiny fraction of it. Most of it went to businesses of various sorts. 2) Huge numbers of people lost their jobs or had their incomes reduced by significant amounts in 2020 due to the pandemic. Framing it as "people got an extra 16% and that was it" is hopelessly oversimplifying the situation. Thus, I cannot put any credence in the idea that the fact that both of those were about 16% is anything more than a coincidence. 3) Again, the duration of the inflation is not in any way commensurate with the duration of the stimulus. The last payment was in...what was it? March 2021? and now nearly 2 years later there's still "inflation" and people are talking about it as if it's primarily caused by those two tiny little stimulus checks. It just seems crazy to me to say "sure, that tiny bit of stimulus was the entire reason for several years of inflation; corporate greed has nothing whatsoever to do with it."
    - AbrahamParangi 4y ago
      1) Yes but those business spent that money! On stuff, or services, or people! And spending drives prices up! 2) I agree it's a vast oversimplification, but the point is that money was put in and prices went up. They went up by an amount surprisingly similar to the amount of additional cash available. It's totally an oversimplification, but do you have a better explanation? Like your theory is that corporations are greedy? Sure. Are they greedier than they were before? Are the checks on their greed - competition and consumer reluctance to buy higher cost products - suddenly absent? 3) For a possible explanation of the duration, I would direct your attention to: https://www.reddit.com/r/wallstreetbets/comments/zd4ppn/household_excess_savings_likely_gone_by_mid2023/ https://www.reddit.com/r/wallstreetbets/comments/zd4ppn/hous... Essentially regular people, on average, still have a lot more cash than they had before the pandemic. Generally speaking I'd say this is great but the fact is that this cash is not associated with any productivity increases, we have the same amount of stuff, but more cash. So prices go up.
      - danaris 4y ago
        1) Sure, but that stimulus is not the money that went directly to people. I'm not entirely clear on whether you were making the distinction previously, but far too many people (some deliberately, most, I think, not) blur that line, and talk about the total stimulus when referring to the number (because it's big) and when referring to societal effects (because they're measurable)—but then turn around and talk about the individual stimulus payments as if they were all or a majority of that when talking about how we shouldn't just be handing out money to people, etc. 2) I did propose a better explanation: Coincidence. Two data points that look similar, in a situation like this, is not enough to make coincidence particularly unlikely. 3) The most likely explanation for that seems to be that, because of the pandemic, we're not doing a lot of the things we were normally doing before. My family certainly isn't: we haven't taken a vacation since winter 2019, and we've cut out many of our previous habits that a) cost money, and b) put us more at risk for COVID. Now, I believe my family is fairly far toward one end of that spectrum, but I also believe there are enough people who have cut out at least some stuff (and not put it back yet) that it is, at least, a highly likely explanation for the phenomenon you cite there.
naasking 4y ago
> In what world is the massive, multiple waves of stimulus just completely unrelated but instead it’s those greedy corporations who are for some reason no longer bound by price competition. It's not unrelated, it's part of the 2-3% I mentioned. The out of control inflation we've actually seen is driven by corporate profiteering and is seen in the data: https://youtu.be/udITRL9-t08 https://youtu.be/udITRL9-t08

danaris 4y ago

The stimulus that actually reached people was tiny. It was, what, 2 $2k checks or something? That's about 2 months' worth of income. There is no way in hell 2 months' worth of extra income in 2020 has anything to do with 3 years' worth of inflation.

AbrahamParangi 4y ago
Just noticing that 2 months worth of extra income is a 16% increase. Prices between 2020 and 2022 went up by, on average, 16%. Also, payments to individuals and families accounted for only 30% or so of total Covid stimulus! But entities which are not people still spend money! Both on goods, services, and on salaries paid to people who then spend that money on goods and services. It just seems crazy to me to say “no way, it has nothing to do with the $5 trillion dollar stimulus.”
- danaris 4y ago
  1) I don't recall the details of the aggregate amount of stimulus, but the total stimulus was not the payments to regular people. That was actually only a tiny fraction of it. Most of it went to businesses of various sorts. 2) Huge numbers of people lost their jobs or had their incomes reduced by significant amounts in 2020 due to the pandemic. Framing it as "people got an extra 16% and that was it" is hopelessly oversimplifying the situation. Thus, I cannot put any credence in the idea that the fact that both of those were about 16% is anything more than a coincidence. 3) Again, the duration of the inflation is not in any way commensurate with the duration of the stimulus. The last payment was in...what was it? March 2021? and now nearly 2 years later there's still "inflation" and people are talking about it as if it's primarily caused by those two tiny little stimulus checks. It just seems crazy to me to say "sure, that tiny bit of stimulus was the entire reason for several years of inflation; corporate greed has nothing whatsoever to do with it."
  - AbrahamParangi 4y ago
    1) Yes but those business spent that money! On stuff, or services, or people! And spending drives prices up! 2) I agree it's a vast oversimplification, but the point is that money was put in and prices went up. They went up by an amount surprisingly similar to the amount of additional cash available. It's totally an oversimplification, but do you have a better explanation? Like your theory is that corporations are greedy? Sure. Are they greedier than they were before? Are the checks on their greed - competition and consumer reluctance to buy higher cost products - suddenly absent? 3) For a possible explanation of the duration, I would direct your attention to: https://www.reddit.com/r/wallstreetbets/comments/zd4ppn/household_excess_savings_likely_gone_by_mid2023/ https://www.reddit.com/r/wallstreetbets/comments/zd4ppn/hous... Essentially regular people, on average, still have a lot more cash than they had before the pandemic. Generally speaking I'd say this is great but the fact is that this cash is not associated with any productivity increases, we have the same amount of stuff, but more cash. So prices go up.
    - danaris 4y ago
      1) Sure, but that stimulus is not the money that went directly to people. I'm not entirely clear on whether you were making the distinction previously, but far too many people (some deliberately, most, I think, not) blur that line, and talk about the total stimulus when referring to the number (because it's big) and when referring to societal effects (because they're measurable)—but then turn around and talk about the individual stimulus payments as if they were all or a majority of that when talking about how we shouldn't just be handing out money to people, etc. 2) I did propose a better explanation: Coincidence. Two data points that look similar, in a situation like this, is not enough to make coincidence particularly unlikely. 3) The most likely explanation for that seems to be that, because of the pandemic, we're not doing a lot of the things we were normally doing before. My family certainly isn't: we haven't taken a vacation since winter 2019, and we've cut out many of our previous habits that a) cost money, and b) put us more at risk for COVID. Now, I believe my family is fairly far toward one end of that spectrum, but I also believe there are enough people who have cut out at least some stuff (and not put it back yet) that it is, at least, a highly likely explanation for the phenomenon you cite there.

naasking 4y ago

> In what world is the massive, multiple waves of stimulus just completely unrelated but instead it’s those greedy corporations who are for some reason no longer bound by price competition. It's not unrelated, it's part of the 2-3% I mentioned. The out of control inflation we've actually seen is driven by corporate profiteering and is seen in the data: https://youtu.be/udITRL9-t08 https://youtu.be/udITRL9-t08