0.1% inflation for March

my pt is simple. raising prices can lower, increase or even keep profit margins the same & that is true given any rate of inflation. Further, I think the changes in supply are the real reason for increases profits. not simply the raising of prices. changes in supply, not inf per se, are what is fairly diff IMO. I don't think we'd see such a phenomenon if this inf was caused purely by loose money.

 

I'd agree with supply chain causing inflation before I would "corporations using inflation as an excuse to raise prices." As you noted, generally speaking, if a company has prices set too high, they'll feel the wrath of god. While there may be more opportunities for profit here and there, that's part of being in a free market system. If corporations get too greedy, they get crushed. It's also undeniable that we doused the money supply fire more in a 2-year span from 2020 to 2022 than we ever have before in any previous 2-year span. The Fed moving heaven and earth to reverse that is further evidence that it was a problem.

 

I’m not sure who you are replying to in this thread, but the point you are making here is the point I am making. You had a backward supply curve shift, with a static demand, resulting in higher prices, and higher profits. This is a natural result of the shift, not some management decisions on a whim to raise prices and screw consumers. Then add some demand stimulus to the mostly fixed short term backward shifted supply and it makes matters worse.

Of course in time things tend to equalize which is what we have been seeing.

This whole narrative of greedy corporations are causing inflation by increased profits by jacking up prices is exactly backwards. Supply and demand shifts cause prices to rise, which leads to higher profits.

 

Is Corporate Greed to Blame for Record Inflation? – NBC 6 South Florida

Why can't it be both? This article isn't "proof" but economists have at least expressed the same concern.

 

In the long run. We’ve had so much corporate consolidation that these market forces are slower - in my opinion - so you can great away with pricing increases for longer time periods. It’s why monopolies and oligopolies suck.

 

All of the scapegoating to avoid the cold hard truth economists have warned about for decades, which is that we over-juiced the money supply and thus we have inflation. If the money supply wasn't a concern, the Fed would keep interest rates at 0 and pump money all the time. M&A's have always happened in corporate America. Just accept it. We over-pumped.

 

You offered zero evidence in this thread other than your undying blind support of anything that you feel is a dig at the Biden administration. Transparently your argument abdicates any attempt to provide factual backing and resorts to “I just know”. You my friend, don’t know. By the way Fed funds rate was near zero for a decade until the pandemic and the Orange God was calling for it to be cut when he was in office. Low supply and profit taking caused 70%+ of the inflation. Stimulus was short lived, replaced lost revenue, never led to demand increases over prepandemic trend as most industries are selling far less units than 2019 but at higher prices.. not because people are buying more.. they aren’t.. because they have fewer to sell and make more money with higher prices and fewer units in uncompetitive markets.

 

If you can read a graph, what do you think happens in the next year or so given the sharp spike in rates? Hint: starts with an "r" and ends with a "cession". It'll be Biden's recession. Trump +10.

 

Lolz... not even in a recession yet...

Only 33% of Americans approve of Biden’s handling of the economy, new poll finds

LOLOLOLOLOL

 

Deflection. Now that you have given up supporting your claim you want to talk about the nasty side effects the Feds policy? Ok. The fed is making a mistake. No rate raise will fix supply shortage prices. Only time will.

 

These quoted economists are liberal think tanks with a left leaning agenda. Personally I don’t take them terribly seriously. As long as people are willing to pay more companies should charge more. That’s why they are in business. People can vote with their feet and shop elsewhere, buy a substitute or just don’t buy it in many circumstances.

 

actually a rate rise should slow the economy, slow demand, equalize supply and demand and hasten fixing supply shortages, and thus inflation.

 

Unnecessary and deleterious at this point IMO. Bank lending has finished the job. In any event in looking at bond yields it appears the market is pricing in a less than 25% chance of a rate hike. I suspect we may see a rate cut late 2023 or early 2024

 

It’s like saying you’ll fix the bad gas efficiency of your car by crashing it. Sure you car won’t guzzle gas… but it’s destroyed.

Rates aren’t surgical. We have surgical shortages.

 

Deflection would only be present if you had a legitimate argument that needed to be countered.

 

Yeah, let’s compare a car to our $27 trillion economy.

 

More deflection. The point you have not laid out a single data point for is stimulus is causing current pricing to be high. I'd like to see that leg work. You stated it. Please support it so I can consider your statement of fact.

 

derp derp

 

From a recent report I received:

"For the first time in twenty years, credit card balances were flat in the first quarter after the fourth quarter holiday spending spree. According to the New York Fed... Interest bearing debt, as a percent of disposable income, dipped to 7.6% in Q1, after two years of increases from the historic COVID lows. This is relatively low, 20 years ago, credit card balances averaged 14% of disposable income."

FRED has the same pattern mentioned above,, historical lows, but a slightly higher raw percentage.