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If the retail stores are price fixing then why are their stock prices down so much this year? Their investors are getting savaged. What did they do with all thi

If the retail stores are price fixing then why are their stock prices down so much this year? Their investors are getting savaged. What did they do with all this extra cashflow?

FirmwareBurner 3y ago
My guess is because in Germany they're taking a loss due to actual competition, and making it up in other countries like Austria where they rake in higher profits than in their home-land.
- iraqmtpizza 3y ago
  So anti-competitive practices are the norm in Austria but no one would dare try it in Germany? Truly bizarre theory.
  - FirmwareBurner 3y ago
    I never said nobody tried price fixing in Germany, but when it comes to consumer pricing in retail, my take is that Germany has a bigger market with more competition meaning the retailers can stomach increased competition and lower margins making it up in sheer volume. Smaller countries like Austria have much less competition, less volume sales, meaning more space for monopolies to form to charge higher prices.
    - iraqmtpizza 3y ago
      what happened to the Common Market
      - FirmwareBurner 3y ago
        Common market means that Apple can't charge for iCloud to Sweden more expensively (before tax) than what they charge to Spain, it doesn't mean that goods made in one country of the union can't have way different pricing in another based on shipping, VAT, taxes, labor, supply/demand, or straight up price gouging.
        iraqmtpizza 3y ago
        I'm talking about laws and enforcement of laws against anti-competitive practices like price fixing. Either enforcement is wildly different and there's a shitload of money to be made by undercutting the Austrian grocery cartel or the price fixing theory is just a socialist talking point.
        em-bee 3y ago
        but in order to do that for groceries you have to open shops in austria which makes it much more difficult compared to products that can be sold online.
        iraqmtpizza 3y ago
        How hard is it to sell food out of a flower shop? Out of a candy store? A toy store? A gift shop? A coffee shop? A hardware store? There are retailers all over the country that could start selling food in no time flat. Starbucks is part of the Austrian grocery cartel too? And there's still no evidence that authorities are turning a blind eye to price fixing other than 'price go up.' Ask an Austrian hardware store owner why he doesn't sell food when he can supposedly undercut grocery stores and still make 5% profit on every item sold. I bet you anything he'll say that's bs.
        em-bee 3y ago
        i am not sure i understand what your argument is, or what you think mine is. your last sentence suggests that you don't believe that anyone can just undercut the big supermarket chains in austria. which is what i also don't believe. but your first sentence is saying something different, so that has me confused.
        iraqmtpizza 3y ago
        What will happen if a hardware store starts selling bread? Austrian grocery cartel thugs will show up and break his legs? Please explain in detail why you believe that coffee shops cannot sell bread without a multi-year planning and approval process. It's bs that anyone not in the supposed cartel can suddenly make huge profits on food by undercutting. Gross margins on food are almost certainly very low. THERE IS NO CARTEL. There is no room to undercut. There is no evidence of illegal price fixing other than price go up. The only cartel is the Austrian government which is the cause of the price increases--not via lack of enforcement of laws but from carrying out their policies as written. This is inconvenient to the socialist talking point about corporations fixing the price of bread with impunity.
      - tetris11 3y ago
        In Germany? It gets superceded by more ethnic retailers importing cheap produce from their relatively poorer origin countries, and offering actual competitive prices against the likes of Aldi and Lidl. I've noticed a surge in Germans going to Turkish/Arabic food stores in the last few years.
        ccozan 3y ago
        It is true: the chicken in turkish store is quite cheaper than ANY discounter at ANY time. And quality is above average.
      - inglor_cz 3y ago
        This is indeed my question as well. I am Czech. We are right next to Germany. Theoretically, this is one huge Common Market. In practice, many mass-produced things are much more expensive in Czechia than in Germany, including food. I suspect that the language barrier is still real. But then again, German-speaking Austria experiences the same thing. I wish we had a common European delivery service, like the US has US Post or DHL, with the same cost structure across the entire continent. We don't, a package from Spain to Czechia is much more expensive than within either Spain or Czechia. A common European delivery service would give foreign e-shops a massive competitive edge. Suddenly, it would be more efficient to buy cheaper things in Slovenia or Bulgaria.
        beebeepka 3y ago
        You think villains such as Macron would allow actual competition? They fucked half the continent trucking companies to enrich their own. So much for unity
  - manmal 3y ago
    Matter of fact is that crossing the border to Germany will make your shopping 30+% cheaper. Make of that what you will, but it’s the same companies (Rewe, Aldi, Lidl).
    - evbogue 3y ago
      I do this in Chicago ... Every time I could shop at Jewel or Mariano's I instead cross the border into Aldi and get similar stuff with less choices for 30% off!
    - iraqmtpizza 3y ago
      Literally no possible way Austrian grocery stores are pulling in 43% margins. That's more than Apple makes. I can't tell if this price fixing talk is the product of overactive imaginations or a gigantic lack of imagination. If grocery stores were suddenly capable of 43 percent margins there would be absolute pandemonium in the markets and stocks would skyrocket. Retailers in every industry would be switching to food sales en masse. People would be flying food in by aircraft. You see just the opposite. Food retailers' stocks are down a lot year-to-date.
      - manmal 3y ago
        There is a lot of cross border shopping, both online and offline, so, yeah. You seem to severely underestimate shipping costs though. For perishable goods, of which you buy max €30 every few days, you’d pay at least €10 express shipping fees. And then you have no control over which pieces you‘ll get (hard avocados & soft apples). Also, shipping heavy stuff like sparkling water crates is obviously prohibitively expensive.
        iraqmtpizza 3y ago
        Shipping costs are price fixing now? We're talking about the brain dead price fixing theory. Stay on topic. I'm not the one underestimating shipping costs. The theorists are.
        3y ago
  - lxgr 3y ago
    I wouldn't say "the norm", but Austria is lagging behind Germany in the CPI for a reason: https://en.wikipedia.org/wiki/Corruption_Perceptions_Index https://en.wikipedia.org/wiki/Corruption_Perceptions_Index Government project tenders are often notoriously intransparent, as ironically evidenced by the fact that the government hasn't been able to stand up a price comparison database for months, as also mentioned in TFA.
orangepurple 3y ago
Stock prices have nothing really to do with the company itself. Stock is issued by companies, but the value of a stock is proportional to the expected future hype value of the stock. Given sufficient hype, more people will buy in to it after you buy it, and the unit price of the limited stock issue goes up. Stock picking is simply gambling for retail investors which have zero say in how a company is run.
- iraqmtpizza 3y ago
  According to the conspiracy theory, investors would see HUGE profit margins and they wouldn't rebalance their portfolio to get in on that? Why does the conspiracy theory rely on all investors being completely immune to earnings and allergic to profits? Why are earnings reports such a massive deal normally but in the grocery business nobody cares? Or why would investors assume that the huge earnings are very temporary and do not improve the longer-term outlook? The amount of cope in this thread is truly unfathomable. Just straight up economic illiteracy.
  - orangepurple 3y ago
    Stocks crash on bad earnings reports because the future attractiveness of the stock has diminished. This reduces the likelihood that a future investor will buy your hot potato above the unit price they bought in. Stocks are fundamentally divorced from economic reality EXCEPT when a company ceases trading and several other rare administrative actions. Predicting future hype is all that matters. Or time spent fractionally invested in all broader casino hype trains, e.g. VTI
    - iraqmtpizza 3y ago
      Why in the motherfuck would it be a bad earnings report when, according to this conspiracy theory, gross margins on food would have gone from 1% to 43%? Conservatively that would lead to a ten thousand percent increase in the stock price. Yet instead the stocks of Metro AG and SPAR Group, Inc. are down 25 or more percent YTD.

If the retail stores are price fixing then why are their stock prices down so much this year? Their investors are getting savaged. What did they do with all this extra cashflow?

FirmwareBurner 3y ago

My guess is because in Germany they're taking a loss due to actual competition, and making it up in other countries like Austria where they rake in higher profits than in their home-land.

iraqmtpizza 3y ago
So anti-competitive practices are the norm in Austria but no one would dare try it in Germany? Truly bizarre theory.
- FirmwareBurner 3y ago
  I never said nobody tried price fixing in Germany, but when it comes to consumer pricing in retail, my take is that Germany has a bigger market with more competition meaning the retailers can stomach increased competition and lower margins making it up in sheer volume. Smaller countries like Austria have much less competition, less volume sales, meaning more space for monopolies to form to charge higher prices.
  - iraqmtpizza 3y ago
    what happened to the Common Market
    - FirmwareBurner 3y ago
      Common market means that Apple can't charge for iCloud to Sweden more expensively (before tax) than what they charge to Spain, it doesn't mean that goods made in one country of the union can't have way different pricing in another based on shipping, VAT, taxes, labor, supply/demand, or straight up price gouging.
      - iraqmtpizza 3y ago
        I'm talking about laws and enforcement of laws against anti-competitive practices like price fixing. Either enforcement is wildly different and there's a shitload of money to be made by undercutting the Austrian grocery cartel or the price fixing theory is just a socialist talking point.
        em-bee 3y ago
        but in order to do that for groceries you have to open shops in austria which makes it much more difficult compared to products that can be sold online.
        iraqmtpizza 3y ago
        How hard is it to sell food out of a flower shop? Out of a candy store? A toy store? A gift shop? A coffee shop? A hardware store? There are retailers all over the country that could start selling food in no time flat. Starbucks is part of the Austrian grocery cartel too? And there's still no evidence that authorities are turning a blind eye to price fixing other than 'price go up.' Ask an Austrian hardware store owner why he doesn't sell food when he can supposedly undercut grocery stores and still make 5% profit on every item sold. I bet you anything he'll say that's bs.
        em-bee 3y ago
        i am not sure i understand what your argument is, or what you think mine is. your last sentence suggests that you don't believe that anyone can just undercut the big supermarket chains in austria. which is what i also don't believe. but your first sentence is saying something different, so that has me confused.
        iraqmtpizza 3y ago
        What will happen if a hardware store starts selling bread? Austrian grocery cartel thugs will show up and break his legs? Please explain in detail why you believe that coffee shops cannot sell bread without a multi-year planning and approval process. It's bs that anyone not in the supposed cartel can suddenly make huge profits on food by undercutting. Gross margins on food are almost certainly very low. THERE IS NO CARTEL. There is no room to undercut. There is no evidence of illegal price fixing other than price go up. The only cartel is the Austrian government which is the cause of the price increases--not via lack of enforcement of laws but from carrying out their policies as written. This is inconvenient to the socialist talking point about corporations fixing the price of bread with impunity.
    - tetris11 3y ago
      In Germany? It gets superceded by more ethnic retailers importing cheap produce from their relatively poorer origin countries, and offering actual competitive prices against the likes of Aldi and Lidl. I've noticed a surge in Germans going to Turkish/Arabic food stores in the last few years.
      - ccozan 3y ago
        It is true: the chicken in turkish store is quite cheaper than ANY discounter at ANY time. And quality is above average.
    - inglor_cz 3y ago
      This is indeed my question as well. I am Czech. We are right next to Germany. Theoretically, this is one huge Common Market. In practice, many mass-produced things are much more expensive in Czechia than in Germany, including food. I suspect that the language barrier is still real. But then again, German-speaking Austria experiences the same thing. I wish we had a common European delivery service, like the US has US Post or DHL, with the same cost structure across the entire continent. We don't, a package from Spain to Czechia is much more expensive than within either Spain or Czechia. A common European delivery service would give foreign e-shops a massive competitive edge. Suddenly, it would be more efficient to buy cheaper things in Slovenia or Bulgaria.
      - beebeepka 3y ago
        You think villains such as Macron would allow actual competition? They fucked half the continent trucking companies to enrich their own. So much for unity
- manmal 3y ago
  Matter of fact is that crossing the border to Germany will make your shopping 30+% cheaper. Make of that what you will, but it’s the same companies (Rewe, Aldi, Lidl).
  - evbogue 3y ago
    I do this in Chicago ... Every time I could shop at Jewel or Mariano's I instead cross the border into Aldi and get similar stuff with less choices for 30% off!
  - iraqmtpizza 3y ago
    Literally no possible way Austrian grocery stores are pulling in 43% margins. That's more than Apple makes. I can't tell if this price fixing talk is the product of overactive imaginations or a gigantic lack of imagination. If grocery stores were suddenly capable of 43 percent margins there would be absolute pandemonium in the markets and stocks would skyrocket. Retailers in every industry would be switching to food sales en masse. People would be flying food in by aircraft. You see just the opposite. Food retailers' stocks are down a lot year-to-date.
    - manmal 3y ago
      There is a lot of cross border shopping, both online and offline, so, yeah. You seem to severely underestimate shipping costs though. For perishable goods, of which you buy max €30 every few days, you’d pay at least €10 express shipping fees. And then you have no control over which pieces you‘ll get (hard avocados & soft apples). Also, shipping heavy stuff like sparkling water crates is obviously prohibitively expensive.
      - iraqmtpizza 3y ago
        Shipping costs are price fixing now? We're talking about the brain dead price fixing theory. Stay on topic. I'm not the one underestimating shipping costs. The theorists are.
        3y ago
- lxgr 3y ago
  I wouldn't say "the norm", but Austria is lagging behind Germany in the CPI for a reason: https://en.wikipedia.org/wiki/Corruption_Perceptions_Index https://en.wikipedia.org/wiki/Corruption_Perceptions_Index Government project tenders are often notoriously intransparent, as ironically evidenced by the fact that the government hasn't been able to stand up a price comparison database for months, as also mentioned in TFA.

orangepurple 3y ago

Stock prices have nothing really to do with the company itself. Stock is issued by companies, but the value of a stock is proportional to the expected future hype value of the stock. Given sufficient hype, more people will buy in to it after you buy it, and the unit price of the limited stock issue goes up. Stock picking is simply gambling for retail investors which have zero say in how a company is run.

iraqmtpizza 3y ago
According to the conspiracy theory, investors would see HUGE profit margins and they wouldn't rebalance their portfolio to get in on that? Why does the conspiracy theory rely on all investors being completely immune to earnings and allergic to profits? Why are earnings reports such a massive deal normally but in the grocery business nobody cares? Or why would investors assume that the huge earnings are very temporary and do not improve the longer-term outlook? The amount of cope in this thread is truly unfathomable. Just straight up economic illiteracy.
- orangepurple 3y ago
  Stocks crash on bad earnings reports because the future attractiveness of the stock has diminished. This reduces the likelihood that a future investor will buy your hot potato above the unit price they bought in. Stocks are fundamentally divorced from economic reality EXCEPT when a company ceases trading and several other rare administrative actions. Predicting future hype is all that matters. Or time spent fractionally invested in all broader casino hype trains, e.g. VTI
  - iraqmtpizza 3y ago
    Why in the motherfuck would it be a bad earnings report when, according to this conspiracy theory, gross margins on food would have gone from 1% to 43%? Conservatively that would lead to a ten thousand percent increase in the stock price. Yet instead the stocks of Metro AG and SPAR Group, Inc. are down 25 or more percent YTD.