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No one is arguing to the contrary. A functioning market based economy shouldn't tolerate massive inflation fuelled by greed, as your competitors should undercut

No one is arguing to the contrary. A functioning market based economy shouldn't tolerate massive inflation fuelled by greed, as your competitors should undercut you.

tonyedgecombe 4y ago
>No one is arguing to the contrary. The original article is. The whole thing is presented as if it's some moral failure on the part of CEO's. Their only solution is price controls. There isn't one mention of breaking up the huge number of monopolies which dominate nearly every area of commerce.
uncfrj 4y ago
What is preventing you from opening a non greedy supermarket?
- boffinism 4y ago
  Taking the question at face value, the answer is: massive amounts of capital. And barriers to entry like that make the 'the free market will solve this' argument less convincing.
  - uncfrj 4y ago
    The mom and pop grocery stores in your local area do not have massive amounts of capital.
    - atchoo 4y ago
      If they represent any meaningful profit margin, they get swallowed by capital unless a government prevents it. There are no "mom and pop" grocery stores in my area. We have "Metro" or "Express" versions of the mega chains instead. You can stand outside one and see two others and there won't be a single independent until you get into a different area that the chains don't consider sufficiently profitable.
    - someweirdperson 4y ago
      They don't have the purchasing powers of their big competitors either.
  - kortilla 4y ago
    That’s what loans and investors are for. Massive amounts of capital is one of the easiest issues to overcome if the business is actually profitable.
    - jensensbutton 4y ago
      You would have to overcome the "barriers to entry", including large up front costs associated with a supermarket, before demonstrating profitability.
      - Gigachad 4y ago
        There are quite a lot of independent supermarket brands around and they seem to struggle to even match the major companies, let alone undercut them. It just seems very unlikely that there actually are huge, unreasonable markups being had here.
    - atchoo 4y ago
      That isn't how it works. The mature businesses dial up the greed when there is no competition and dial it down to crush threats. Once the threat is extinguished, up the dial goes again. Along with all your startup costs, you will be competing against entrenched businesses willing to run at a temporary loss to bleed you dry. They can afford to do this because greed will pay after you are dead. Capitalism does not create efficient competitive markets offering good value to consumers, government intervention does.
      - jmvfivtvtvtgt 4y ago
        In my area, there are Indian, Japanese and Chinese grocery stores within a few miles of Costco and Trader Joe's. Considering these grocery stores are decades old, Costco and Trader Joe's have done a bad job at dialing up the greed.
        danaris 4y ago
        First of all, from what I've heard, Costco and Trader Joe's are, at worst, middle of the pack among large companies as far as greed goes. And assuming incorrectly that the thesis is that all large corporations are equally greedy, then using a couple of specific examples of corporations that are less greedy to disprove it, just makes for a terrible argument. Second, it's exactly that kind of differentiation (offering a niche product that the larger, more generic stores don't want to) that makes it easiest to avoid being undercut and run out of business by larger players. Now, if you said you had several different small local grocery stores thriving without any specific niche, that would be somewhat more surprising.
- wil421 4y ago
  I can’t see my main grocery stores margin because they are private. Kroger’s margin is said to be 1.5% in the last decade and hasn’t gone up in the last couple years. https://www.macrotrends.net/stocks/charts/KR/kroger/profit-margins https://www.macrotrends.net/stocks/charts/KR/kroger/profit-m... Actually Publix does very well at 7-8% and it’s the largest employee owned company in the US. https://www.barrons.com/visual-stories/what-publix-can-teach-other-grocery-chains-01646159717 https://www.barrons.com/visual-stories/what-publix-can-teach...
- jabradoodle 4y ago
  The article and my comment makes no mention of supermarkets.
qeternity 4y ago
Which is why all of this greed-based hand wringing is absurd. Corporate profits went up bc of transfer payments enabled by the Fed. All of those stimmy checks had to end up somewhere. Classical economics predicted the consequences of the Covid monetary response. It’s been textbook. And yet we want to blame everything else except the actual causes.

No one is arguing to the contrary. A functioning market based economy shouldn't tolerate massive inflation fuelled by greed, as your competitors should undercut you.

tonyedgecombe 4y ago

>No one is arguing to the contrary. The original article is. The whole thing is presented as if it's some moral failure on the part of CEO's. Their only solution is price controls. There isn't one mention of breaking up the huge number of monopolies which dominate nearly every area of commerce.

uncfrj 4y ago

What is preventing you from opening a non greedy supermarket?

boffinism 4y ago
Taking the question at face value, the answer is: massive amounts of capital. And barriers to entry like that make the 'the free market will solve this' argument less convincing.
- uncfrj 4y ago
  The mom and pop grocery stores in your local area do not have massive amounts of capital.
  - atchoo 4y ago
    If they represent any meaningful profit margin, they get swallowed by capital unless a government prevents it. There are no "mom and pop" grocery stores in my area. We have "Metro" or "Express" versions of the mega chains instead. You can stand outside one and see two others and there won't be a single independent until you get into a different area that the chains don't consider sufficiently profitable.
  - someweirdperson 4y ago
    They don't have the purchasing powers of their big competitors either.
- kortilla 4y ago
  That’s what loans and investors are for. Massive amounts of capital is one of the easiest issues to overcome if the business is actually profitable.
  - jensensbutton 4y ago
    You would have to overcome the "barriers to entry", including large up front costs associated with a supermarket, before demonstrating profitability.
    - Gigachad 4y ago
      There are quite a lot of independent supermarket brands around and they seem to struggle to even match the major companies, let alone undercut them. It just seems very unlikely that there actually are huge, unreasonable markups being had here.
  - atchoo 4y ago
    That isn't how it works. The mature businesses dial up the greed when there is no competition and dial it down to crush threats. Once the threat is extinguished, up the dial goes again. Along with all your startup costs, you will be competing against entrenched businesses willing to run at a temporary loss to bleed you dry. They can afford to do this because greed will pay after you are dead. Capitalism does not create efficient competitive markets offering good value to consumers, government intervention does.
    - jmvfivtvtvtgt 4y ago
      In my area, there are Indian, Japanese and Chinese grocery stores within a few miles of Costco and Trader Joe's. Considering these grocery stores are decades old, Costco and Trader Joe's have done a bad job at dialing up the greed.
      - danaris 4y ago
        First of all, from what I've heard, Costco and Trader Joe's are, at worst, middle of the pack among large companies as far as greed goes. And assuming incorrectly that the thesis is that all large corporations are equally greedy, then using a couple of specific examples of corporations that are less greedy to disprove it, just makes for a terrible argument. Second, it's exactly that kind of differentiation (offering a niche product that the larger, more generic stores don't want to) that makes it easiest to avoid being undercut and run out of business by larger players. Now, if you said you had several different small local grocery stores thriving without any specific niche, that would be somewhat more surprising.
wil421 4y ago
I can’t see my main grocery stores margin because they are private. Kroger’s margin is said to be 1.5% in the last decade and hasn’t gone up in the last couple years. https://www.macrotrends.net/stocks/charts/KR/kroger/profit-margins https://www.macrotrends.net/stocks/charts/KR/kroger/profit-m... Actually Publix does very well at 7-8% and it’s the largest employee owned company in the US. https://www.barrons.com/visual-stories/what-publix-can-teach-other-grocery-chains-01646159717 https://www.barrons.com/visual-stories/what-publix-can-teach...
jabradoodle 4y ago
The article and my comment makes no mention of supermarkets.

qeternity 4y ago

Which is why all of this greed-based hand wringing is absurd. Corporate profits went up bc of transfer payments enabled by the Fed. All of those stimmy checks had to end up somewhere. Classical economics predicted the consequences of the Covid monetary response. It’s been textbook. And yet we want to blame everything else except the actual causes.