Greedflation

I agree it’s a thing and I’m not discounting and have mentioned in the past. Having said that one would think there is a limit to how long that cycle can continue.

 

I suspect that it might be quite persistent. I mean, how many people even on this board, which is filled with a self-selected, mostly college educated, mostly heavy news consumption group are still claiming that inflation is much higher than it is right now? So many biases when we get to feelings around pricing. It is tough to disentangle them all.

 

Economy isn’t crappy. Try to keep up.

 

I sold my beach condo this year for a lot more than what I paid for it 4 years ago. The buyers were excited about buying. They also made a lot of money on their home which they sold just prior to buying mine. I in turn paid quite a bit more for my new home than what it was worth 3 years ago. It’s often a wash for buyers and sellers who stay in the same market. I don’t consider that greedflation.

 

Fwiw

Mean ole Publix has turkeys on sale for 99 cents a pound and their half hams for $1.49.

 

Only thing I can gather is if it is a corporation, per some liberals they and their management actors are inherently evil and greedy and as such pricing behavior is greedy but for an individual it is OK and perfectly rational.

I guess I’d have to ask what method of pricing should be used if not supply and demand?

 

Who on this thread said that corporations are evil? Please quote. Identifying the issue is diagnostic. Corporations have no morals good or bad. Next step would be to evaluate whether public policy should address it or not. Why you so triggered by identifying causes of inflation?

 

Causes of inflation; supply and demand. Lesson over.

 

So if I can sell widgets for 50% more and my cost to produce them was only 15% more, should I do it or should I only sell them for what my competitors do?

 

So no one. Thanks.

 

You shouldn’t blame Biden for your decision and as your consumer I’m blaming you and will react accordingly.

 

Thought this was about greed. The reason the prices increase is people are willing to pay them. You can react however you wish, as it seems the market is happy to pay the 50% increase….willingly.

 

Here is the key line from the OP:

You guys are super triggered by the title "greedflation" but nowhere in the OP does the author do anything but diagnose that corporate profit increases led to massive inflation in prices especially where there were fewer competitors then suggesting a remedy. The same people crying a river about inflation are shrugging off the major factor for it.

 

Are there externalities that can cause friction on either side of supply and demand? Or is this equilibrium a thing that happens only in the vacuum of space?

 

I noticed that too and found it amusing. At least i_boy I’m pretty sure wasn’t one of the people complaining about inflation. So he is consistent on this matter, and I’m sure I’ve seen prior posts from him tying inflation to supply chain issues (not sure why he draws the line at corporate criticism). Yes people can vote with their wallets… but being vocal about “odd”, outsized, or out of place price hikes relative to underlying commodities can be a tool as well… talk is less effective - but if enough people complain and point out lower priced alternatives those words help feed information into a free market system and help the market rationalize. Data points.

On the other hand, a couple of posters here in this thread were top complainers about inflation. So it seems strange the people claiming to to be suffering the most and putting blame in a partisan manner, would suddenly be like “hey, those CEO’s gotta eat”!

 

Assets are worth what people are willing to pay for them. If someone pays $600k for an asset that can sale for $900k, that’s on the seller.

 

It is tough sledding in your industry. I was hyper focused on owning the property we practice in as soon as I could. The loan payment is almost half of what our lease was when we bought the building in 2009. Add to it…we get equity every payment on the loan. And the building is probably worth twice as much now. Location is as good as it gets.

I completely understand your position of it not being enjoyable and would think the lease side of the business has to be awful. I hated the year and a half we were involved in it and just thankful we were able to purchase the building…

 

of course

In my mind supply chain issues were the primary cause. However massive govt spending played a part too in terms of demand.

As to Biden admin, they probably overshot and were too heavy on stimulus. Trump admin not blameless. To a degree I hold them responsible but at the same time they had to do something.

I don’t blame corporations for what they are supposed to do. If it weren’t for higher prices ( and profits) there would be continued stock outs and empty store shelves.

 

Yeah, I’m out of the business now. Landlords did absolutely nothing while we had to work our tails off to run the business and they sit and collect more than we do in profit at the end of the day. Once we got better at running the business locations, we made good money (far more than the landlord was making), but I’d rather take half or even a third of the money we made being a passive income landlord vs a business operator any day. I was a landlord for years prior to owning that business and it was much easier income.

 

You mean it’s on the buyer.

But yes, you are correct in your premise. Captain Obvious-ish, but correct. The biggest issue with the “it’s on the buyer” position is that a lot of buyers are irresponsible and impatient. Just because the bank gave you a $1M loan at a low interest rate to buy a property that was $500k last year doesn’t mean you should do it. But… many people don’t think like this. They are monthly payment shoppers.