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I suspect all the “greedy companies jacking up prices” stories lately are in service of this year’s election cycle. Trillions extra in government spending with

I suspect all the “greedy companies jacking up prices” stories lately are in service of this year’s election cycle. Trillions extra in government spending without a corresponding increase in production created high inflation. Now, like a frosting-smeared toddler standing next to an empty cake pan, they’re pointing the finger at the family dog. Greedy corporations, pay their fair share, we’ve seen this tired trope before.

eightysixfour 3y ago
We can test this hypothesis by looking at the profits of publicly traded companies.
- Scene_Cast2 3y ago
  IIRC profit margins of grocery stores are around 4%.
  - nerdponx 3y ago
    The grocery stores generally aren't the ones increasing prices.
whynotmaybe 3y ago
The opposite could be true like in Canada where a Loblaws lobbyist is the campaign manager for the Conservative party and Loblaws keeps jacking up prices on everything.
cjbgkagh 3y ago
It’s safe to assume that companies are always greedy, it’s in their nature. That’s why we need competition between companies. The alternative is regulation but companies tend to love regulation as regulatory capture is easier than real competition. I think systems that presuppose non-greedy companies are just as fanciful as those that presuppose non corrupt governments.
acdha 3y ago
This doesn’t make any sense – the government spent money in no small part due to enormous demand from businesses for assistance, company profit margins are public data, and your vague “they” is conflating the government, academics, and journalists as a single group coordinating for political reasons despite obvious differences between and within those groups. Study after study has found that profit taking is a considerable cost driver: https://finance.yahoo.com/news/greedflation-caused-more-half-last-100000899.html https://finance.yahoo.com/news/greedflation-caused-more-half...
- ungreased0675 3y ago
  What specifically doesn’t make sense? A bigger pool of money chasing the same amount of resources equals higher prices (and profits).
  - acdha 3y ago
    The simplistic framing and acting like this is some poor companies being beat up by a poorly defined conspiracy of everyone else trying to skew an election. Reality is just so much more complicated, and I’d start with the thought that perhaps this is getting attention now because a lot of people are feeling financial pressure and that is triggering interest from many different parties.
  - paulmd 3y ago
    There’s a lot more that goes into velocity of money/demand for money than those 2 singular factors.
- leereeves 3y ago
  One thing is clear: whoever wrote the headline in your link cherry-picked a time period that overstates the effect of "greedflation". > Corporate profits drove 53% of inflation during the second and third quarters of 2023 and more than one-third since the start of the pandemic IOW, even according to that report, roughly two-thirds of recent inflation was not due to greedflation.
  - 3y ago

eightysixfour 3y ago

We can test this hypothesis by looking at the profits of publicly traded companies.

Scene_Cast2 3y ago
IIRC profit margins of grocery stores are around 4%.
- nerdponx 3y ago
  The grocery stores generally aren't the ones increasing prices.

whynotmaybe 3y ago

The opposite could be true like in Canada where a Loblaws lobbyist is the campaign manager for the Conservative party and Loblaws keeps jacking up prices on everything.

cjbgkagh 3y ago

It’s safe to assume that companies are always greedy, it’s in their nature. That’s why we need competition between companies. The alternative is regulation but companies tend to love regulation as regulatory capture is easier than real competition. I think systems that presuppose non-greedy companies are just as fanciful as those that presuppose non corrupt governments.

acdha 3y ago

This doesn’t make any sense – the government spent money in no small part due to enormous demand from businesses for assistance, company profit margins are public data, and your vague “they” is conflating the government, academics, and journalists as a single group coordinating for political reasons despite obvious differences between and within those groups. Study after study has found that profit taking is a considerable cost driver: https://finance.yahoo.com/news/greedflation-caused-more-half-last-100000899.html https://finance.yahoo.com/news/greedflation-caused-more-half...

ungreased0675 3y ago
What specifically doesn’t make sense? A bigger pool of money chasing the same amount of resources equals higher prices (and profits).
- acdha 3y ago
  The simplistic framing and acting like this is some poor companies being beat up by a poorly defined conspiracy of everyone else trying to skew an election. Reality is just so much more complicated, and I’d start with the thought that perhaps this is getting attention now because a lot of people are feeling financial pressure and that is triggering interest from many different parties.
- paulmd 3y ago
  There’s a lot more that goes into velocity of money/demand for money than those 2 singular factors.
leereeves 3y ago
One thing is clear: whoever wrote the headline in your link cherry-picked a time period that overstates the effect of "greedflation". > Corporate profits drove 53% of inflation during the second and third quarters of 2023 and more than one-third since the start of the pandemic IOW, even according to that report, roughly two-thirds of recent inflation was not due to greedflation.
- 3y ago