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“corporations will try to raise prices when they think they can get away with it” is just firms being firms and has no additional explanatory power. This has s
by adamsb6 3y ago
“corporations will try to raise prices when they think they can get away with it” is just firms being firms and has no additional explanatory power.
This has some explanatory power: they can get away with charging more dollars because more dollars are available.
The money supply expanded like never before in 2020: https://fred.stlouisfed.org/series/M2SL https://fred.stlouisfed.org/series/M2SL
It is now contracting, which is also unprecedented. We may well end up with deflation and while that sounds nice, we don’t know what might break.
- astrange 3y agoWe're not on target for deflation; American consumers love spending money and are currently doing it as hard as they can. We seem to, amazingly, be hitting the soft landing. Some other countries are doing poorly at the moment, but that's always true. If you want to see the money supply shrink more, I'm told a good way is better tax enforcement. https://x.com/bbkogan/status/1733190102245888366 https://x.com/bbkogan/status/1733190102245888366 (sorry for the informal source…)
- didibus 3y agoThis has just as much explanatory power: They're able to charge higher prices because individuals are saving less than ever, believe that rising costs are due to inflation and not corporate greed, and don't perceive it as price gouging but rather as a consequence of the current situation in 2023, including the global pandemic and the war in Ukraine. Additionally, we're witnessing an unparalleled level of consolidation across various industries, significantly reducing competition compared to previous years.