“Greedflation” is a nonsense idea(economist.com)
economist.com
“Greedflation” is a nonsense idea
https://www.economist.com/leaders/2023/07/06/greedflation-is-a-nonsense-idea
140 comments
Makes me glad I live in a country where pay raise to match inflation (at a minimum) each year is mandatory by law.
Allows us to ask for actual pay raises on top of that.
Allows us to ask for actual pay raises on top of that.
That seems like an effective way of creating self-reinforcing inflation.
If by self-reinforcing you mean run-away then the math doesn't work out.
For nearly any Good / Service the price is not 100% labor.
This means that if a price index (PI) goes up 2% and that causes a 2% increase in labor prices those labor prices will have a <2% increase in that PI. Lets be generous and say it has a 1% increase in that PI. That 1% increase will cause a 0.5% increase in the next PI iteration and next time it's a .25% and will effectively become 0% as the number of iterations increases.
The fact that prices aren't 100% labor is also why when looking at minimum wage increases the cost of a good doesn't increase by the same amount that minimum wage does. i.e. increasing minimum wage 20% (historically) doesn't increase a PI by 20%.
For nearly any Good / Service the price is not 100% labor.
This means that if a price index (PI) goes up 2% and that causes a 2% increase in labor prices those labor prices will have a <2% increase in that PI. Lets be generous and say it has a 1% increase in that PI. That 1% increase will cause a 0.5% increase in the next PI iteration and next time it's a .25% and will effectively become 0% as the number of iterations increases.
The fact that prices aren't 100% labor is also why when looking at minimum wage increases the cost of a good doesn't increase by the same amount that minimum wage does. i.e. increasing minimum wage 20% (historically) doesn't increase a PI by 20%.
Only if productivity stagnates, which it hasn't been in most industries.
> pay raise to match inflation (at a minimum) each year is mandatory by law
So it's illegal to give someone a pay cut?
I guess they lay them off instead, but probably that is a legal issue too?
Luckily going out of business is perfectly ok (I assume), as well as never starting a business in the first place.
So it's illegal to give someone a pay cut?
I guess they lay them off instead, but probably that is a legal issue too?
Luckily going out of business is perfectly ok (I assume), as well as never starting a business in the first place.
[deleted]
which country is that?
looks like Belgium, Spain, France, Cyprus, Luxembourg, Malta and Slovenia
https://www.ecb.europa.eu/pub/pdf/other/mb200805_focus05.en....
https://www.ecb.europa.eu/pub/pdf/other/mb200805_focus05.en....
Definitely, not Spain
[deleted]
His pay did stay the same, so at least he's not preaching water while drinking wine...
https://www.bankofengland.co.uk/freedom-of-information/2022/...
https://www.bankofengland.co.uk/freedom-of-information/2022/...
> > Last year Andrew Bailey, governor of the Bank of England, asked workers to “think and reflect” before asking for pay rises.
Yeah, pay raises aren't good for shareholder value.
Besides, we all know the CEO deserves all the money. They do all the work, why shouldn't they reap all the profits? (/s for those that need it)
Yeah, pay raises aren't good for shareholder value.
Besides, we all know the CEO deserves all the money. They do all the work, why shouldn't they reap all the profits? (/s for those that need it)
> Everybody should have been asking for pay raises the last two years for at least enough to cover the inflation rate.
And your employer reserves the "right" to be ungrateful/not appreciate you/take a stance in negotiation to try to protect their bottom line and say "no".
If inflation happens, then you ask your employer to give you a raise, and they say yes, and they then pass the difference along (increased payroll cost) to their customers through increased prices of goods and services, that creates more inflation.
https://en.wikipedia.org/wiki/Wage-price_spiral
And your employer reserves the "right" to be ungrateful/not appreciate you/take a stance in negotiation to try to protect their bottom line and say "no".
If inflation happens, then you ask your employer to give you a raise, and they say yes, and they then pass the difference along (increased payroll cost) to their customers through increased prices of goods and services, that creates more inflation.
https://en.wikipedia.org/wiki/Wage-price_spiral
Wage-price spirals only happen when business owners refuse to adjust down their operating margins and instead pass the increased payroll costs on to their customers. Too much economic value is accruing to capital and not enough to labor. This is what needs to change.
Also: If companies could increase profits by raising prices, they would do so, regardless of what their wages were. The whole "we'll pass along prices to consumers" threat is empty. If companies could simply raise prices, they would (and they do, when they can).
Isn't the same true with labor? If they can get more money for their work, they will ask for more money or quit and find a job that pays more? At least, that is what seems to have been happening for the last couple of years. The only problem with that is that finding a new job kind of sucks and is risky.
You know, as a much, much younger person I actually thought that there is not even a reason for raises ( I had no concept of inflation ) if you are doing the same thing over and over. Eventually, I saw just how much an average manager makes and I realized that it is literally a zero sum game. Management just gets a bigger slice if they manage to somehow bamboozle its workforce so there is a big incentive to do just that regardless of whether it sounds stupid or is even based on facts.
More amusingly, I never saw a manager pass on an increase 'to not fuel inflation' further.
More amusingly, I never saw a manager pass on an increase 'to not fuel inflation' further.
> More amusingly, I never saw a manager pass on an increase 'to not fuel inflation' further.
From a morale perspective, working year after year at the same place for the same pay kind of sucks. How often do you hear people being responsible for less/taking on less responsibility over time?
From a morale perspective, working year after year at the same place for the same pay kind of sucks. How often do you hear people being responsible for less/taking on less responsibility over time?
Okay I thought and reflected now where's my pay rise?
The economist is a nonsense idea.
Already been shown that inflation is being abused to raise prices in many places.
Now it might not have started this mess, but it's for sure keeping it going.
It's the ECB itself, normally Unilever's friend, who argued such: https://www.theguardian.com/business/2023/jun/27/corporate-p...
Now fair enough, the ECB should point the finger at itself for it's monetary policy.
Already been shown that inflation is being abused to raise prices in many places.
Now it might not have started this mess, but it's for sure keeping it going.
It's the ECB itself, normally Unilever's friend, who argued such: https://www.theguardian.com/business/2023/jun/27/corporate-p...
Now fair enough, the ECB should point the finger at itself for it's monetary policy.
> inflation is being abused to raise prices
Inflation is the rising of prices. If prices are rising around you, it makes sense to raise your own prices. Just like it makes sense for workers to look for raises (i.e. raise their prices).
Inflation is the rising of prices. If prices are rising around you, it makes sense to raise your own prices. Just like it makes sense for workers to look for raises (i.e. raise their prices).
Yeah if you think the stores didn't use the general price hike and took advantage of it you our pretty gullible.
According to the ECB itself it was the corporates who were the main driver & cause: theguardian.com/business/2023/jun/27/corporate-profits-driving-up-prices-ecb-president-christine-lagarde
According to the ECB itself it was the corporates who were the main driver & cause: theguardian.com/business/2023/jun/27/corporate-profits-driving-up-prices-ecb-president-christine-lagarde
Is it 'abusing' inflation if I ask my company for a larger raise due to inflation?
Yeah if its more then the inflation itself and you are doing it under the guise of inflation it's manipulative. Lots of products jumped 50% in grocery stores here, main argument was gas prices, then gas prices went down, still prices went up. And record profits as well.
I think that companies are always trying to make the most profit per unit sold. Inflation may have provided a stimulus that led to the companies being able to increase their prices, even beyond the increase in costs, but the inflation had to already be there for this to happen. I don't think it's really abuse; they are free to charge whatever they want.
The Economist cares about pushing the baseless opinion of their unnamed editors. They're a rag without the courage to name or give credit to their writers.
capitalists never let a good crisis go to waste
we need only see how the government reacted since March of 2020 to see how they react to crisis
The government vetoed business, not the other way around. That's why do many shops were shut down or had signs blocking you from buying "non essential" goods
Deciding who is essential who is not is deciding who goes bankrupt and who makes record profits.
Under developed argument. It gets to the interesting claim:
>> Though there may be examples of opportunistic or anti-competitive behaviour, the effects are unlikely to have been material.
Then completely fails to substantiate.
Wasn’t worth the click.
>> Though there may be examples of opportunistic or anti-competitive behaviour, the effects are unlikely to have been material.
Then completely fails to substantiate.
Wasn’t worth the click.
Yeah, I would have been interested in this alternative hypothesis if it had any evidence behind it. Just a lot of "trust me bro" statements which don't cut it when peoples lives/livelihoods are in the mix.
The claim is that "the alternative to letting the price mechanism bring supply and demand into line is to rely on something worse, such as rationing or queues."
The way the system works is we assume a profit-maximization motive by actors, and nothing about that changed before or during the inflation, so it's obvious that something else is going on (i.e. fiscal stimulus during supply chain disruptions).
The way the system works is we assume a profit-maximization motive by actors, and nothing about that changed before or during the inflation, so it's obvious that something else is going on (i.e. fiscal stimulus during supply chain disruptions).
How someone can look at that graph and say that greedflation is nonsense is absurd.
Look at the growth in margins from 2019-today and tell me that margin growth isn’t egregious. Forget rate changes…look at the base numbers - 15% average profit is usury by most definitions (the US financial system even got a legal carve out for credit cards to be egregiously usurious)
This author wants us to ignore the last 5 years of greed fueled inflation - which used debt to drive margins up - coming due now.
Look at the growth in margins from 2019-today and tell me that margin growth isn’t egregious. Forget rate changes…look at the base numbers - 15% average profit is usury by most definitions (the US financial system even got a legal carve out for credit cards to be egregiously usurious)
This author wants us to ignore the last 5 years of greed fueled inflation - which used debt to drive margins up - coming due now.
> 15% average profit is usury by most definitions
Usury strictly refers to interest and has no bearing on the profit margin of a risky enterprise that deals in goods and services.
If my landscaper spends $5 in gasoline and an hour and a half to mow my lawn, where he values his own time at $20 an hour, his cost is $35. If he charges me $50 for this service, are you going to call that usurious?
Usury strictly refers to interest and has no bearing on the profit margin of a risky enterprise that deals in goods and services.
If my landscaper spends $5 in gasoline and an hour and a half to mow my lawn, where he values his own time at $20 an hour, his cost is $35. If he charges me $50 for this service, are you going to call that usurious?
>Are you going to call that usurious
Absolutely
Absolutely
https://www.pbs.org/newshour/show/oil-companies-post-massive...
An example from site itself: https://fortune.com/2022/03/31/us-companies-record-profits-2...
It's absurd.
An example from site itself: https://fortune.com/2022/03/31/us-companies-record-profits-2...
It's absurd.
What's absurd is the notion that profit is evil, or that there is some set amount of profit above which it is evil. Before its blowout result in 2022, Exxon Mobil (the first company the PBS article points a finger at) lost $20b in one quarter back in 2020[0], more than its net income in any single quarter since then. Should companies not be allowed to lose money, either, then?
[0]: https://www.macrotrends.net/stocks/charts/XOM/exxon/net-inco...
[0]: https://www.macrotrends.net/stocks/charts/XOM/exxon/net-inco...
Profit is not evil.
Having record profits and having layoffs, paying stagnant wages, giving exorbitant bonuses to executives for "op-ex reduction," while price fixing is evil.
Having record profits and having layoffs, paying stagnant wages, giving exorbitant bonuses to executives for "op-ex reduction," while price fixing is evil.
> What's absurd is the notion that profit is evil, or that there is some set amount of profit above which it is evil.
The term "price gouging" exists because we collectively agree that, at a certain point, yes, excessive profits are indicative of abuse.
This isn't even controversial. The most extreme libertarian economist would agree that, for example, market failures like monopolies can create circumstances where excess profits become egregious.
And we know from history that widespread crises can lead to market conditions that result in excess profits.
> Should companies not be allowed to lose money, either, then?
And this is a silly strawman that isn't worth responding to.
The term "price gouging" exists because we collectively agree that, at a certain point, yes, excessive profits are indicative of abuse.
This isn't even controversial. The most extreme libertarian economist would agree that, for example, market failures like monopolies can create circumstances where excess profits become egregious.
And we know from history that widespread crises can lead to market conditions that result in excess profits.
> Should companies not be allowed to lose money, either, then?
And this is a silly strawman that isn't worth responding to.
Price gouging is a term, but so is Klingon. It's not real.
https://youtu.be/ymMzJAdIAes
Margins go up when firms have pricing power. This happens when demand outstrips supply. The system is set up to raise prices to allocate that supply to whoever values it most. You can argue for different systems of allocation, but right now we use capitalism, and it’s working as intended.
We can also argue about why demand is outstripping supply. Are monopolies keeping out competitors and artificially limiting supply? In some industries probably.
But we did dump a ton of money via fiscal stimulus into a system that was already stretched thin due to supply chain disruptions. That seems like the most likely explanation for the broad inflation we’re experiencing, though consolidation has likely exacerbated the problem.
We can also argue about why demand is outstripping supply. Are monopolies keeping out competitors and artificially limiting supply? In some industries probably.
But we did dump a ton of money via fiscal stimulus into a system that was already stretched thin due to supply chain disruptions. That seems like the most likely explanation for the broad inflation we’re experiencing, though consolidation has likely exacerbated the problem.
I may be wrong, but I don't think everyone blaming corporations necessarily thinks that they are the root cause - what many do agree on is that corporations are taking advantage of the situation to make it worse. Of course, the root cause is poor monetary policy in general. That doesn't mean the actors are innocent.
People are being laid off and prices are still going up - who is setting the prices? If you're jacking prices to cover sliding sales, yes, you are the problem.
People are being laid off and prices are still going up - who is setting the prices? If you're jacking prices to cover sliding sales, yes, you are the problem.
> Of course, the root cause is poor monetary policy in general. That doesn't mean the actors are innocent.
Particularly when C-level execs continue to award themselves double-digit pay-rises, then publicly cry that wages should be compressed.
Particularly when C-level execs continue to award themselves double-digit pay-rises, then publicly cry that wages should be compressed.
> the root cause is poor monetary policy in general
These two things aren't even separate. Part of monetary policy is taxation and subsidies. The argument for "greedflation" is exactly one of poor monetary policy, in that we have allowed corporations (not necessarily any one person, but the corporation as a whole) to dictate too much of our monetary policy, and they're doing a poor job.
These two things aren't even separate. Part of monetary policy is taxation and subsidies. The argument for "greedflation" is exactly one of poor monetary policy, in that we have allowed corporations (not necessarily any one person, but the corporation as a whole) to dictate too much of our monetary policy, and they're doing a poor job.
At least in the US the fed has specifically had full employment as one of their goals at least for the last few years so I'm pretty skeptical of "corporations control the fed arguments"
Like I agree there's a lot of regulatory capture in the US but I just don't see any reason to think the fed is responding to big business rather than their own preferences.
Like I agree there's a lot of regulatory capture in the US but I just don't see any reason to think the fed is responding to big business rather than their own preferences.
The problem I have with these claims are the lack of examples. Which companies would you say have been unfairly exploiting inflation to raise profits? The data is all transparent. The reason I ask is because what I keep seeing is something people reacting to things like "Company ABC's profits increased by 5%, to record breaking levels!" And in many cases that's absolutely true. But if your profits increase by 5%, and inflation increases by 9% - it means you're both (1) showing record breaking profits and (2) getting absolutely economically wrecked.
Just a quick example: BP almost doubled their profits in 2022 even when the price oil didn't really double with respect to 2021 prices. https://www.bp.com/en/global/corporate/news-and-insights/pre...
> But if your profits increase by 5%, and inflation increases by 9%
One should actually look not at inflation but at the increase in costs of that company. Not all companies are equally exposed to inflation, they will suffer different price increases.
> But if your profits increase by 5%, and inflation increases by 9%
One should actually look not at inflation but at the increase in costs of that company. Not all companies are equally exposed to inflation, they will suffer different price increases.
Maybe instead of focusing on profits we should focus on profit margins.
If your profit margin is increasing, then inflation means less.
If your profit margin is increasing, then inflation means less.
In wartime it’s called profiteering and in some countries it counts as treason, which is to say it can get you hanged.
Being wrong in wartime doesn't make it right in peacetime.
No such thing as profiteering.
No such thing as profiteering.
[deleted]
Eh, they call it, “what the market will bear” and they’re quite proud of it.
It’s a lot easier to do a lot of things when you Other the people you deal with, including exploitation and especially warcrimes.
They don’t talk about citizens or people, they talk about “the market”, which is barely anthropomorphic.
It’s a lot easier to do a lot of things when you Other the people you deal with, including exploitation and especially warcrimes.
They don’t talk about citizens or people, they talk about “the market”, which is barely anthropomorphic.
It's a lot easier to criticize "the market" when you live in a system that benefits from it. Life is universally worse in places where "the market" doesn't exist or economic actors aren't allowed to profit.
I think you’re confusing “any benefit” with “net benefit”.
The world, the US, and Capitalism would all survive just fine without McDonald’s, Walmart, or Oracle. In fact it would probably be better off without any of them. Global homogeneity is not awesome, it’s dystopian. Companies having less power than the 90th percentile of countries would be good.
When you have a regional company you can still afford to think of your customers more or less as humans instead of statistics.
The world, the US, and Capitalism would all survive just fine without McDonald’s, Walmart, or Oracle. In fact it would probably be better off without any of them. Global homogeneity is not awesome, it’s dystopian. Companies having less power than the 90th percentile of countries would be good.
When you have a regional company you can still afford to think of your customers more or less as humans instead of statistics.
Every seller needs a buyer for a transaction to happen. For some reason, people are still happy to take 84-month notes on $80k cars instead of sticking to their older car or buying a cheaper one; same with expensive beef, which could be substituted by lentils or other cheaper sources of protein.
A part, perhaps even a large part, of that "some reason" is likely the increase in money supply as well as fiscal stimulus. But consumers still share a part of the blame, if they willingly take on that transaction for non-essential goods and services. Few businesses have the pricing power to jack up their prices arbitrarily high, though there is a clear trend towards consolidation across many industries in the recent decades, and one could definitely argue that the US hasn't busted enough mergers and trusts.
A part, perhaps even a large part, of that "some reason" is likely the increase in money supply as well as fiscal stimulus. But consumers still share a part of the blame, if they willingly take on that transaction for non-essential goods and services. Few businesses have the pricing power to jack up their prices arbitrarily high, though there is a clear trend towards consolidation across many industries in the recent decades, and one could definitely argue that the US hasn't busted enough mergers and trusts.
The people taking advantage of the situation to make it worse aren't the ones raising prices in the last 3 years. It's the one who pushed Covid restrictions and shutting down the world, who's repercussions we are still living with
In transportation and logistics, it turned into a bidding war, with the biggest box shops able to outbid anyone else. So rail and trucking and ships made the most profit in the history of existence by pitting everyone else against each other for a limited supply.
A bit of greed inflation and a bit of how a market economy works during a shortage. Now as shipping costs have dropped, companies have not dropped their prices accordingly because they have to cover their new massive headcounts and severance.
A bit of greed inflation and a bit of how a market economy works during a shortage. Now as shipping costs have dropped, companies have not dropped their prices accordingly because they have to cover their new massive headcounts and severance.
Yeah, it is a ridiculously bold to outright state it is not a factor of current inflation issues. At best you can argue that corporations 'only' further fuel it ( and take advantage in the process ), but are not primary factors for it rearing its head. Propaganda is strong, but I am starting to wonder if the powers that be learned nothing from Covid pushback to 'commute is your zen time'.
It's not ridiculous. Nobody has proved greed goes up and down. It can be a constant like gravity. A gas station doesn't determine its prices based on greed, otherwise we would see stations that decide to charge a hundred bucks a gallon.
Ye olde Motte and Bailey.
There are in fact people who are saying its only corporate inflation.
The real reason i'm skeptical of the greed argument is that its just a vibes based guess on whats happening and not based on any data or insight into the situation.
There are in fact people who are saying its only corporate inflation.
The real reason i'm skeptical of the greed argument is that its just a vibes based guess on whats happening and not based on any data or insight into the situation.
I find it really funny how people blame corporation's "greed" for the high inflation. It's literally raison d'être of for-profit organizations to squeeze as much profits as they can in existing market and regulatory conditions.
The main reasons why corporations get away with "unfair" margins are:
1) Broken anti-trust regulations.
2) Irresponsible fiscal policy effectively monetized by money printing.
3) Ability of corporations and most wealthiest people to ~bribe~ lobby politicians so 2 would benefit mostly them.
To summarize: the root issue is with the government and the political environment which has created it and allowed its short-sighted and irresponsible actions.
The main reasons why corporations get away with "unfair" margins are:
1) Broken anti-trust regulations.
2) Irresponsible fiscal policy effectively monetized by money printing.
3) Ability of corporations and most wealthiest people to ~bribe~ lobby politicians so 2 would benefit mostly them.
To summarize: the root issue is with the government and the political environment which has created it and allowed its short-sighted and irresponsible actions.
Companies exist and are allowed to operate only because the people (voters who vote for the government, who in turn issue business licenses and corporate charters) allow them to. It's about time that the people wake up and remember they permit companies to operate, and they can and should revoke that permission if the company is serving only itself and it's shareholders.
Depends on the system you're in. Many companies could charge more than they do but don't. In the US we have the infamous Supreme Court ruling that the sole purpose of a company is to draw profit.
No quibble here with your summary.
No quibble here with your summary.
Indeed. Perhaps the profit motive has run its course as the primary driver of all economic activity.
Totally natural. In a capitalist society, money is consent. I don’t like it, but that’s how this society is setup.
> Though there may be examples of opportunistic or anti-competitive behaviour, the effects are unlikely to have been material.
So, there is prove that it is anti-competitive behavior. There is prove that all big corporations should be split in pieces. But The Economist decides to ignore that.
The Economist is not that bad. At least, it presents the data. Big monopolies are the source of inflation, the lack of competition is the source of inflation. But it always falls short to get to any reasonable conclusion, and decides to ignore its own data. That's a shame.
So, there is prove that it is anti-competitive behavior. There is prove that all big corporations should be split in pieces. But The Economist decides to ignore that.
The Economist is not that bad. At least, it presents the data. Big monopolies are the source of inflation, the lack of competition is the source of inflation. But it always falls short to get to any reasonable conclusion, and decides to ignore its own data. That's a shame.
"the effects are unlikely to have been material"
"material" means "having real importance or great consequences".
So the Economist is directly stating the opposite of your conclusion: the opportunistic and anti-competitive behavior, if any, is unlikely to have been a significant source of inflation.
"material" means "having real importance or great consequences".
So the Economist is directly stating the opposite of your conclusion: the opportunistic and anti-competitive behavior, if any, is unlikely to have been a significant source of inflation.
The Economist makes no bones about having an angle, that’s its whole thing.
When I read them I try not to get anything that wades into their very obvious lassiez-faire bias.
When I read them I try not to get anything that wades into their very obvious lassiez-faire bias.
Same. I don't read them anymore, but I used to subscribe. Much of what they do is worthwhile, but there's the occasional bad take. But same goes for New York Times, Washington Post, and Wall Street Journal.
A simpler explanation of 'greedflation' is simply that the lack of actual competition by market leaders in most consumer goods markets has lead to massive profits and higher prices, without increased wages.
"Greed, for lack of a better word, is good" - a fantastic quote from a fun movie, but it can in fact be true too. If we use greed as a means to drive competitors in a market, competing against each other, resulting in them creatively undercutting one another, driving down prices so that they can sell the most, then the consumer wins out.
But that isn't happening anymore.
The largest corporations in each market have gained dominance through mergers, acquisitions, etc. They can reduce their own costs because of their massive scale, more than anyone newcomer can. The result is less and less competition for even basic things like groceries. Here in Canada, there are dozens of different grocery store brands- and they're all owned by 3 companies, giving the illusion of choice.
If there were lots of competing retailers for common goods, they'd also be competing for labour, offering better salaries and benefits to their employees, which would help alleviate the cost of living crisis we're in now. But that isn't happening either, again because there's fewer and fewer companies to work for.
All the while, the leaders of the world's large corporations are taking hundreds of millions of dollars in salaries, and giving their shareholders billions in profits.
"You don't need a formal conspiracy when interests converge. These people went to the same universities and fraternities. They're on the same boards of directors. They go to the same country clubs. They have like interests. They don't need to call a meeting. They know what's good for them." - George Carlin[0]
When you have a situation like this, it is, in my view, the role of government to step in and break up these companies.
[0]https://www.youtube.com/watch?v=VAFd4FdbJxs
"Greed, for lack of a better word, is good" - a fantastic quote from a fun movie, but it can in fact be true too. If we use greed as a means to drive competitors in a market, competing against each other, resulting in them creatively undercutting one another, driving down prices so that they can sell the most, then the consumer wins out.
But that isn't happening anymore.
The largest corporations in each market have gained dominance through mergers, acquisitions, etc. They can reduce their own costs because of their massive scale, more than anyone newcomer can. The result is less and less competition for even basic things like groceries. Here in Canada, there are dozens of different grocery store brands- and they're all owned by 3 companies, giving the illusion of choice.
If there were lots of competing retailers for common goods, they'd also be competing for labour, offering better salaries and benefits to their employees, which would help alleviate the cost of living crisis we're in now. But that isn't happening either, again because there's fewer and fewer companies to work for.
All the while, the leaders of the world's large corporations are taking hundreds of millions of dollars in salaries, and giving their shareholders billions in profits.
"You don't need a formal conspiracy when interests converge. These people went to the same universities and fraternities. They're on the same boards of directors. They go to the same country clubs. They have like interests. They don't need to call a meeting. They know what's good for them." - George Carlin[0]
When you have a situation like this, it is, in my view, the role of government to step in and break up these companies.
[0]https://www.youtube.com/watch?v=VAFd4FdbJxs
The solutions aren't popular. As a Canadian I do a lot of shopping at Walmart because they have a different supply chain than the Metro, Loblaws No Frills Freshco class of stores. More international brands less local jobs is not a winning politicla slogan
The problem with using government to break up companies is regulatory capture (https://en.wikipedia.org/wiki/Regulatory_capture). Companies have the interest and resources to influence the very government agencies that are meant to regulate them. They use these influences to steer the regulatory environment to prevent newcomers in the industry.
For a counterpoint, see the Planet Money episode "Inflation and the Profit-Price Spiral" [1], where a researcher has some convincing arguments that yes, corporate decisions and profits are one of the most important drivers of the current inflation.
Personally I found it much more convincing than this article.
[1] https://www.youtube.com/watch?v=mu0HLfcK5hs
Personally I found it much more convincing than this article.
[1] https://www.youtube.com/watch?v=mu0HLfcK5hs
The only, and I mean only decent argument I've seen against 'greedflation' is that if corporations are increasing prices for increased profit, it's odd that I haven't seen it reflect in share prices.
That would only hold true if shares always trade against a fixed P/E ratio, and with rising interest rates up P/E ratios have historically gone down.
Can you provide a summary? It's quick to skim an article for arguments, but not a video.
Summary of What has been driving inflation? Economists' thinking may have changed | Planet Money
This is an AI generated summary. There may be inaccuracies.
00:00:00 - 00:25:00 In this video, economists discuss the factors driving inflation and how their thinking has evolved. Traditionally, inflation has been attributed to factors such as excessive demand, insufficient supply, or too much money chasing too few goods. However, economists are now exploring alternative explanations, including the wage-price spiral and the profit-price spiral. While rising wages leading to higher prices and vice versa have been a historical concern, recent data suggests that wages have not been keeping up with inflation, prompting economists to examine the role of corporate profits. The video highlights that corporate greed is not the primary driver of inflation, as firms have always pursued profits. However, severe bottlenecks in the economy, such as those experienced after World War II and during the pandemic, can create opportunities for corporations to increase prices and profits. The economists discuss the concept of price controls and the role of corporate profit growth in driving inflation. They find evidence that markup growth, closely related to corporate profits, accounted for a significant portion of inflation in 2021. This challenges the traditional focus on wage growth as an indicator of inflation and suggests that rising profits should also be considered. The idea that the expectations of higher costs in the future could drive inflation, even if costs themselves don't increase, is also discussed. The economists express uncertainty and acknowledge they may not have all the answers, but they feel validated by the evidence gathered and are interested in seeing how corporations will behave in the coming year.
This is an AI generated summary. There may be inaccuracies.
00:00:00 - 00:25:00 In this video, economists discuss the factors driving inflation and how their thinking has evolved. Traditionally, inflation has been attributed to factors such as excessive demand, insufficient supply, or too much money chasing too few goods. However, economists are now exploring alternative explanations, including the wage-price spiral and the profit-price spiral. While rising wages leading to higher prices and vice versa have been a historical concern, recent data suggests that wages have not been keeping up with inflation, prompting economists to examine the role of corporate profits. The video highlights that corporate greed is not the primary driver of inflation, as firms have always pursued profits. However, severe bottlenecks in the economy, such as those experienced after World War II and during the pandemic, can create opportunities for corporations to increase prices and profits. The economists discuss the concept of price controls and the role of corporate profit growth in driving inflation. They find evidence that markup growth, closely related to corporate profits, accounted for a significant portion of inflation in 2021. This challenges the traditional focus on wage growth as an indicator of inflation and suggests that rising profits should also be considered. The idea that the expectations of higher costs in the future could drive inflation, even if costs themselves don't increase, is also discussed. The economists express uncertainty and acknowledge they may not have all the answers, but they feel validated by the evidence gathered and are interested in seeing how corporations will behave in the coming year.
From memory: Products prices are determined by costs + profits. Inflation is a rise of that sum. Economists traditionally hyper-focus on costs, primarily wages, as the cause of inflation, while completely ignoring profits.
The podcast features a researcher, who has received high pushback from the economics corner although recently more articles support her view somewhat, who says that her research shows corporate profits are the main driver of the 2022+ inflation, and also played a - lesser but under-highlighted - role in the past inflationary periods in the 20th century.
One main reason she highlights is companies expect higher costs and raise prices, but those costs don't materialize, leading to higher profits. This also has a compounding effect throughout the supply chain because each intermediary adds an effect, resulting in a high increase at the consumer end.
The podcast features a researcher, who has received high pushback from the economics corner although recently more articles support her view somewhat, who says that her research shows corporate profits are the main driver of the 2022+ inflation, and also played a - lesser but under-highlighted - role in the past inflationary periods in the 20th century.
One main reason she highlights is companies expect higher costs and raise prices, but those costs don't materialize, leading to higher profits. This also has a compounding effect throughout the supply chain because each intermediary adds an effect, resulting in a high increase at the consumer end.
> Products prices are determined by costs + profits.
That's already backwards, though. Prices are determined by what the market will bear, according to the demand curve and what competitors are charging (which puts a ceiling on it).
Then companies attempt to keep costs as low as possible, and their success or lack thereof determines their profits.
(This assumes a lack of collusion over pricing -- but that's the responsibility of the government to prevent, catch, and deter through antitrust.)
That's already backwards, though. Prices are determined by what the market will bear, according to the demand curve and what competitors are charging (which puts a ceiling on it).
Then companies attempt to keep costs as low as possible, and their success or lack thereof determines their profits.
(This assumes a lack of collusion over pricing -- but that's the responsibility of the government to prevent, catch, and deter through antitrust.)
A reminder that The Economist is owned by oligarchs and part of the very system it is poorly defending in this article. Look up who owns the Newspaper - as always, it's rich families like the Rothschilds, Cadburys, etc.
Really stop and think, what would these families and corporations prefer? A bunch of pissed of people in the streets mad at their governments and policies? Or a bunch of people reading a news article that says your concerns are 'nonsense'?
Really stop and think, what would these families and corporations prefer? A bunch of pissed of people in the streets mad at their governments and policies? Or a bunch of people reading a news article that says your concerns are 'nonsense'?
Isn't a large newspaper always going to be owned by the rich, almost by definition? And there are a lot of progressive/liberal rich too.
They could be owned by the State as well.
And I would say, they could easily be owned by readers in a consumer-coop model. These work for many other industries, I don't see why it wouldn't work for newspapers.
I think most importantly, a lot of newspapers now a days are money losing businesses. But they provide political influence (local in most cases) so they're still useful for rich people to push certain agendas whereas genuine competitors just don't have the resources to maintain them.
And I would say, they could easily be owned by readers in a consumer-coop model. These work for many other industries, I don't see why it wouldn't work for newspapers.
I think most importantly, a lot of newspapers now a days are money losing businesses. But they provide political influence (local in most cases) so they're still useful for rich people to push certain agendas whereas genuine competitors just don't have the resources to maintain them.
True, they could be owned by the State, which opens another can of worms.
A coop newspaper would be cool, although if it is viable why isn't it already happening? Or is it?
A coop newspaper would be cool, although if it is viable why isn't it already happening? Or is it?
Not always, but yes, information brokers tend to consolidate wealth and power.
And I made no mention of political orientation, please stop with the tired idea that this is a conservative/liberal issue. I have more in common with a redneck in Alabama than I do with Jeff Bezos. Stop falling for their traps.
And I made no mention of political orientation, please stop with the tired idea that this is a conservative/liberal issue. I have more in common with a redneck in Alabama than I do with Jeff Bezos. Stop falling for their traps.
What I meant is that a lot of rich people support more re-distributive economic policies, like high marginal taxes and expansion of welfare.
Sorry I misunderstood your point. You're right that they tend to support more socialistic policies, though I don't necessarily believe in how much they actually want these policies passed. They all greatly benefit from the status quo.
In the cases of these newspapers, it's clear they're used to hold political power and push narratives. The willingness for that billionaire to take on CNN for $1 despite it losing money shows that I think.
In the cases of these newspapers, it's clear they're used to hold political power and push narratives. The willingness for that billionaire to take on CNN for $1 despite it losing money shows that I think.
The entire field of "Economics" was created as a way for the wealthy elite to justify / rationalize their capitalist oppression of the working class, so it should come as no surprise that a publication that serves a mouthpiece for the wealthy elites and that is named after a field that was created to serve the wealthy elites espouses ideas that solely benefit the wealthy elite.
Anytime rich people say something is bad, one can generally assume that by bad they mean only for them and their entrenched wealth and power and so therefore is good for the rest of us.
Anytime rich people say something is bad, one can generally assume that by bad they mean only for them and their entrenched wealth and power and so therefore is good for the rest of us.
And whom is responsible by and large for working hard to influence those laws?
It's a bit like saying it isn't Intuit's fault for how crazy it is to file taxes in the U.S., as it's all coming from lawmaker policy. The problem is, Intuit has been working hard to influence said laws in their favor for decades; they are very much responsible for why taxes there are still a quagmire of forms and rules.
This is a wonderful fluff piece that appears to work hard to redirect blame in a different direction.
> Regardless, the fact that companies raise their prices in response to shortages is not only defensible but desirable.
It's not necessarily the demand driven increase that pisses people off. It's when that price becomes the new normal afterwards that becomes the problem. Three guesses as to why it stays there.
It's a bit like saying it isn't Intuit's fault for how crazy it is to file taxes in the U.S., as it's all coming from lawmaker policy. The problem is, Intuit has been working hard to influence said laws in their favor for decades; they are very much responsible for why taxes there are still a quagmire of forms and rules.
This is a wonderful fluff piece that appears to work hard to redirect blame in a different direction.
> Regardless, the fact that companies raise their prices in response to shortages is not only defensible but desirable.
It's not necessarily the demand driven increase that pisses people off. It's when that price becomes the new normal afterwards that becomes the problem. Three guesses as to why it stays there.
If interest rates go down, the value of current profits increases and the value of future profits decreases.
This would incentivize companies to be slightly more "greedy" if you define "greedy" by "seeking current profits".
In practice, a bunch of data scientists have looked into "greedflation", and I'm not aware of anyone finding anything significant.
NPR did an episode on it: https://www.npr.org/2023/06/13/1182019025/is-greedflation-re...
If you start with the world view that companies are evil and the source of all problems, it's easy to see "greedflation" everywhere.
Seek and you shall find.
This would incentivize companies to be slightly more "greedy" if you define "greedy" by "seeking current profits".
In practice, a bunch of data scientists have looked into "greedflation", and I'm not aware of anyone finding anything significant.
NPR did an episode on it: https://www.npr.org/2023/06/13/1182019025/is-greedflation-re...
If you start with the world view that companies are evil and the source of all problems, it's easy to see "greedflation" everywhere.
Seek and you shall find.
"Greedflation" is such an odd word. It implies that, as of late, these companies have "jacked up the prices under the cover of inflation". But since when have any of these corporate entities needed a reason to increase their prices or lower their wages? So strange that we demand a rationale when it appears to me that they are behaving as they are made to behave?
I think this was always true, but maybe many companies realized that they were playing it too safe and conservative with price bumps?
What changed (besides a good excuse) is big data being and analytics being much easier to obtain and manage. If people can't get the same product category cheaper anywhere else and they keep buying it then of course the will raise more aggressively.
I feel the market will eventually correct if "greedflation" is real. Someone must come along and say that they are happy with X% less which is theoretically possible, to capture a market more aggressively and use this narrative as a marketing tool.
I know it's easier said than done when there are few players in an industry and the barrier to entry is rather high.
What changed (besides a good excuse) is big data being and analytics being much easier to obtain and manage. If people can't get the same product category cheaper anywhere else and they keep buying it then of course the will raise more aggressively.
I feel the market will eventually correct if "greedflation" is real. Someone must come along and say that they are happy with X% less which is theoretically possible, to capture a market more aggressively and use this narrative as a marketing tool.
I know it's easier said than done when there are few players in an industry and the barrier to entry is rather high.
My cynical take is that, in this market, "human work" is cheaper than the cost of "human living". There's no real malice, just supply and demand. We've automated all our labor but we expect our workers to be ever more productive. Of course that can't be sustained, eventually the average value produced by a worker exceeds their cost of living. And then... IDK what happens next.
If one company unilaterally increase their prices in a stable environment they will probably lose market share to their competitors.
I guess that when prices are rising sharply anyway, it's easier to raise them and it won't be noticed so much. And their competitors probably make the same calculation.
At least, that's what I understand by it.
I guess that when prices are rising sharply anyway, it's easier to raise them and it won't be noticed so much. And their competitors probably make the same calculation.
At least, that's what I understand by it.
In a lot of industries you have a company that's a price leader. If they raise prices their competitors will also raise prices to increase profits instead of trying to take away market share from the price leader. They'll do that because it's trivial to do vs the risk and logistical hassle of trying to increase production. Remember the price leader can instantly drop prices again which could put you underwater.
Good article. If you're old enough or know history, you've seen how artificially low interest rates cause (or at least greatly contribute to) these problems in the first place, and then somehow everyone except the central economic planners get blamed.
Money should have a market price, not be manipulated by a few people in power.
Money should have a market price, not be manipulated by a few people in power.
It's weird that many people (even some economists) think that inflation somehow overrides the free price system [0] or the price mechanism [1]. No it's doesn't. There are no "inflation spirals" or other weird things whatsoever.
Spiral (or run-away inflation) would suggest an accelerating curve, while the price mechanism is actually closer to logarithmic, i.e. it starts fast, slows down and converges around the new equilibrium. It's basically a decentralized optimization algorithm.
[0] https://en.wikipedia.org/wiki/Free_price_system
[1] https://en.wikipedia.org/wiki/Price_mechanism
Spiral (or run-away inflation) would suggest an accelerating curve, while the price mechanism is actually closer to logarithmic, i.e. it starts fast, slows down and converges around the new equilibrium. It's basically a decentralized optimization algorithm.
[0] https://en.wikipedia.org/wiki/Free_price_system
[1] https://en.wikipedia.org/wiki/Price_mechanism
It's funny; on my Facebook news feed's comments you'd get the impression that The Economist is some kind of far-left progressive newspaper. Here you get the impression that it's some kind of Ronald Reagan-Jeff Bezos love child.
I guess this is what happens when you are a centrist publication in 2023.
I guess this is what happens when you are a centrist publication in 2023.
Sorry Economist propagandists, 60% of recent inflation is a direct result of excessive profits caused by raising prices to soak consumers for no reason other than greed.
https://www.forbes.com/sites/errolschweizer/2022/09/12/how-p...
https://www.npr.org/2023/05/19/1177180972/economists-are-rec...
https://www.forbes.com/sites/errolschweizer/2022/09/12/how-p...
https://www.npr.org/2023/05/19/1177180972/economists-are-rec...
This is like half of an article, because of course, everyone recognizes that companies charge more when supply-chains and other things are screwed up.
But many of those costs have dropped, some to pre-pandemic levels or even lower, but the consumer prices have not dropped to match, and profits are growing.
https://www.cnbc.com/2022/05/18/wingstop-is-seeing-meaningfu...
Wingstop raised prices of wings during lockdown (even switching to being "Thighstop" for a while). Now prices are back down to earth, but they haven't modified their prices to match.
But many of those costs have dropped, some to pre-pandemic levels or even lower, but the consumer prices have not dropped to match, and profits are growing.
https://www.cnbc.com/2022/05/18/wingstop-is-seeing-meaningfu...
Wingstop raised prices of wings during lockdown (even switching to being "Thighstop" for a while). Now prices are back down to earth, but they haven't modified their prices to match.
[deleted]
[deleted]
> Inflation is high, and the search is on for the culprit.
Is it really that hard? Faith in our system's ability to produce desirable results is waning (greed may be among the reasons, poor leadership during the worst parts of the pandemic may also be). That makes money feel more fictional than usual, which means it's worth less.
Turns out people don't put as much energy into playing games that they think are meaningless.
Is it really that hard? Faith in our system's ability to produce desirable results is waning (greed may be among the reasons, poor leadership during the worst parts of the pandemic may also be). That makes money feel more fictional than usual, which means it's worth less.
Turns out people don't put as much energy into playing games that they think are meaningless.
Couldn’t read the whole article but in the beginning they write:
The imf has found that higher profits “account for almost half the increase” in the euro zone’s inflation…
It sounds like it’s a legitimate idea. Do they disprove the IMF finding? With the rise of oligopolies it seems to me that pricing power isn’t subject to downward pressures one would normally expect in a market with healthy competition.
The imf has found that higher profits “account for almost half the increase” in the euro zone’s inflation…
It sounds like it’s a legitimate idea. Do they disprove the IMF finding? With the rise of oligopolies it seems to me that pricing power isn’t subject to downward pressures one would normally expect in a market with healthy competition.
Going to be hard to convince people of this.
In an efficient system, maybe we can blame monetary policy. But we don't have an efficient system; most of us live under mono/ologipolistic supermarket "regimes". They don't compete, they collude. And they're taking advantage of price volatility to gain profits.
In an efficient system, maybe we can blame monetary policy. But we don't have an efficient system; most of us live under mono/ologipolistic supermarket "regimes". They don't compete, they collude. And they're taking advantage of price volatility to gain profits.
It's probably not greed like in a supervillain way, it's more of the following (which I've heard almost verbatim multiple times from business owners):
"Our costs have gone up 7%, so we should raise prices"
"How much?"
"How about 10%?"
"Sounds good"There's nothing wrong with that because you're expecting costs to continue increasing but you might be locking in the price you charge for the next year.
That's the problem with attacking inflation -- it's not about changing current conditions but about changing expectations.
That's the problem with attacking inflation -- it's not about changing current conditions but about changing expectations.
>There's nothing wrong with that because you're expecting costs to continue increasing but you might be locking in the price you charge for the next year.
Ha, if only.
The company I work for has increased their prices about a 10 times in the last 2 years.
Ha, if only.
The company I work for has increased their prices about a 10 times in the last 2 years.
Then that's fantastic they've got that flexibility. But then it's probably a fair assumption they didn't increase their price by 10% each of those 10 times, unless they're in a very small subset of industries.
But other companies sign one-year contracts with customers, for example. There's no need to be snarky about it.
But other companies sign one-year contracts with customers, for example. There's no need to be snarky about it.
This all makes a lot more sense when you view companies as dumb profit optimisers.
"Greed" implies malice aforethought, but these things just make paperclips. They'll charge as much as they can get away with, and hopefully that leads to good outcomes through "market forces" or whatever.
"Greed" implies malice aforethought, but these things just make paperclips. They'll charge as much as they can get away with, and hopefully that leads to good outcomes through "market forces" or whatever.
If greed is the primary mechanism for increased costs, then why do costs ever go down? It seems unlikely that someone gets less greedy. Is that the posited framework?
Frameworks which cannot predict the future well are not very useful.
For instance, did we envision Jeff Bezos suddenly found Jesus on this day? https://aws.amazon.com/blogs/aws/amazon-s3-glacier-price-red...
The thing that gets me is that this is such an obviously bad model (that market prices vary based on participant greed variation) and I would expect people in tech to want a better explanatory mechanism and yet it is madly popular here. Really makes me question a lot of the other predictions and modeling in this community.
Frameworks which cannot predict the future well are not very useful.
For instance, did we envision Jeff Bezos suddenly found Jesus on this day? https://aws.amazon.com/blogs/aws/amazon-s3-glacier-price-red...
The thing that gets me is that this is such an obviously bad model (that market prices vary based on participant greed variation) and I would expect people in tech to want a better explanatory mechanism and yet it is madly popular here. Really makes me question a lot of the other predictions and modeling in this community.
>If greed is the primary mechanism for increased costs, then why do costs ever go down?
Greedy people lose their influence and ability to call the shots as a result of popular outrage, which in turn is a result of comments on HN and other forums complaining about greed :)
Greedy people lose their influence and ability to call the shots as a result of popular outrage, which in turn is a result of comments on HN and other forums complaining about greed :)
That's actually already a better framework because it now explains price variation not with greed but with political and market dynamics.
You posit some greedy people and posit that whether price goes up or down is no longer due to their greed but due to their market power.
It is better because it is falsifiable. I think if you took this pattern of modeling and used a modern LLM as a Socratic teacher you would rederive a model of pricing that is more closely aligned with reality.
Ultimately, this is all very well-trod ground coming from the tradition of Popper and friends.
You posit some greedy people and posit that whether price goes up or down is no longer due to their greed but due to their market power.
It is better because it is falsifiable. I think if you took this pattern of modeling and used a modern LLM as a Socratic teacher you would rederive a model of pricing that is more closely aligned with reality.
Ultimately, this is all very well-trod ground coming from the tradition of Popper and friends.
This is pretty much exactly the opinion I'd expect the Economist to hold on this issue - that profit margins surging was just a coincidence.
It's as unsurprising as RT's opinion on who blew up the Kakhova Dam was.
It's as unsurprising as RT's opinion on who blew up the Kakhova Dam was.
Expected when the newspaper is owned by some of the richest families on Earth. This is basically the same as a police department investigating themselves for wrongdoing.
> Regardless, the fact that companies raise their prices in response to shortages is not only defensible but desirable.
Gouging is good. I'm sure they'll be lowered again when supply stabilizes. Any time now.
Gouging is good. I'm sure they'll be lowered again when supply stabilizes. Any time now.
I think stuff like this is a symptom of our current era of hyper-partisanship. With no real debate, the bad ideas of each side fester, unchallenged.
In other news "Face Eating Leopard" magazine says leopards eating people's faces isn't that big a deal after all.
A third possibility. Prices could also go up if there is lack of competition, implying a lack of proper regulatory oversight.
kinda hard to square with oil companies pulling record _profits_ in the wake of oil shortages due to turmoil in eastern europe and well, how those high energy prices drove a ton of cpi inflation.
you can't blame it on labor or desirable price based rationing when it all ends up in the profit column.
you can't blame it on labor or desirable price based rationing when it all ends up in the profit column.
At no point does this article argue the idea that corporate profit increases are a significant driver of inflation. It's just whataboutism: "but governments did X!" "but consumers did Y!"
The thesis that "shortages create higher profits" is also not proven at all. Yes, in a shortage prices get higher, but at the same time there's less sales. Not to mention that downstream business also suffer from higher prices.
In the end this article comes from a place of treating capitalism as a machine that should be left untouched. Governments, consumers and workers must behave and fall in line, but God forbid questioning who's taking home the money that's mobilized to compensate for certain issues (COVID, war) and what could be done to stop that. Apparently it's never the fault of companies, as if they were some natural phenomenon whose behavior can't be changed.
The thesis that "shortages create higher profits" is also not proven at all. Yes, in a shortage prices get higher, but at the same time there's less sales. Not to mention that downstream business also suffer from higher prices.
In the end this article comes from a place of treating capitalism as a machine that should be left untouched. Governments, consumers and workers must behave and fall in line, but God forbid questioning who's taking home the money that's mobilized to compensate for certain issues (COVID, war) and what could be done to stop that. Apparently it's never the fault of companies, as if they were some natural phenomenon whose behavior can't be changed.
> In economics, inflation is an increase in the general price level of goods and services in an economy. ~Wikipedia
If profit seeking is increasing the general price level of goods (via a “coincidentally” coordinated raising of prices), how is it not causing inflation?
If profit seeking is increasing the general price level of goods (via a “coincidentally” coordinated raising of prices), how is it not causing inflation?
The companies were always seeking maximum profit; obviously something changed since before the inflation hit.
They discovered that they could get even more profit than they believed possible before; specifically that customers could bear even higher prices, at least in the short term.
This was discovered by pandemic price increases caused by increased costs. The new plateaus have just never dropped, even as their costs have dropped.
This was discovered by pandemic price increases caused by increased costs. The new plateaus have just never dropped, even as their costs have dropped.
> This was discovered by pandemic price increases caused by increased costs.
So to be clear, you agree with the article that companies increased prices in response to inflation, and therefore couldn't have been the preliminary cause of it.
So to be clear, you agree with the article that companies increased prices in response to inflation, and therefore couldn't have been the preliminary cause of it.
No, they raised prices because they found an opportunity for more profit that they had missed before. No other forces than greed were required.
You said that pandemic price increases were caused by increased costs.
That only exposed their mistaken assumptions. Education doesn’t cause anything; a person’s (or collective of people’s) choices caused the excessive profit seeking.
I say excessive because it’s not sustainable. The median wages can’t support these profit margins indefinitely.
I say excessive because it’s not sustainable. The median wages can’t support these profit margins indefinitely.
“Why are you being so mean to us :(“ - the 2 bit useless MBAs sitting around in corporations that sponsored this weak PR piece
The S&P is at the highest it's been in a long time, and approaching an all-time-high, yet
> where corporate profits are falling
Bull-fucking-shit
> where corporate profits are falling
Bull-fucking-shit
I guess the Cuban government is the greediest corporation in the world.
> Last year Andrew Bailey, governor of the Bank of England, asked workers to “think and reflect” before asking for pay rises.
I literally laughed out loud. Everybody should have been asking for pay raises the last two years for at least enough to cover the inflation rate.