How much inflation is being driven by greed?

[Cyrano]

According to today's WAPO, prices rose 7.5% over a year ago, the highest pace in 40 years.

Yeah, I know that Covid has fucked things up. Supply lines are stalled, businesses can't hire enough workers and shortages always drive up prices, -- to some degree.

Nonetheless, we all know that our giant corporations are always trying to maximize their profits regardless of who gets hurt. So what I'm asking is, how much of what we're paying for gas, food, etc., is due to current circumstances, and how much is due to plain old-fashioned greed?

Further, we know that most of corporate America tends to favor the Republican Party because of tax breaks, less regulations, and so much more. So I can't help but wonder if much of this inflation is "manufactured" in order to drive down Joe Biden's ratings in the polls.

Everything I've said here in just conjecture. So perhaps some of you who understand economics far better than i do, can chime in with your opinions.

[doc03]

1. I haven't heard of any CEO taking a pay cut or

corporate earnings going down. So I would say most of it.

[Srkdqltr]

2. I really think most of the inflation now is corporate greed.

A good number of the larger businesses could absorb some of the costs and not pass them to the consumer without any problem to their bottom line.
Whenever something goes wrong, weather, strikes, pandemic, businesses hike their prices.
Happens all the time.
Usually gas prices go up when there is some sort of problem so now they all do it.

[brooklynite]

3. Are you saying that corporate America was less greedy last year?

When demand goes up and supply doesn't match it, prices go up; that's basic economics.

[Claustrum]

8. No. But the situation allows for the corporations to be more greedy this year.

If you raised your prices randomly before, the company would be blamed for the price increases. Right now, the blame is on inflation, supply and demand, etc. So they get to be more greedy than before and not get the blame for it.

[unblock]

10. Businesses will always set prices to maximize profit

Except when they have an even greedier long-term strategy, such as keeping prices down to kill competition or expand otherwise market share.

But they will set prices first, then spin it later. Inflation makes for a good cover story, but they would have raised prices anyway if it made them more money. They would have just found a different excuse if they felt the need to explain it at all.

[Jose Garcia]

14. What to stop another company fron NOT raising their prices

in order to take the business away from the companies that are raising their prices? They would certainly have an incentive to do so.

[JanMichael]

19. Corporate rental companies sure the f*** are.

especially in the so-called affordable housing industry. And USDA and housing finance agencies are agreeing to raise their rents and sometimes just get rid of the lower income brackets in tax credit projects which force other programs to suck it up

Basic supply and demand my ass

[AZSkiffyGeek]

24. That's exactly supply and demand

Low supply/high demand.

[bucolic_frolic]

4. At the super, I was shocked 2 weeks ago

when bananas had gone from 45 to 49 to 55 cents. Today, back to 49. Donuts though went from 70 to 75 to 80 to 85. And from what I see, not as many are selling.

I think the most powerful message consumers can send is to use what's in their closets, switch to cheaper substitutes, and let's face it we could all skip two meals a week.

Protein though is on the rise, as is fish. And cooking oil is through the roof and scarce.

Walmart hammered through some of the fattest increases that I've seen, perhaps because of their lower prices overall. Prunes went from I think 1.96 to 2.46.

I think they're all adjusting up for higher wages. And seasonally, prices are a bit fatter in extreme weather months, be they hot or cold.

[Busterscruggs]

5. I'm no economist

But greedy capitalists have done this. Maybe it's time to look at other alternative economic systems

[FBaggins]

6. All of it... and none of it

The amount of greed out there hasn't changed over the last twelve months... so it's really "none".

But to the extent that capitalist economies necessarily are underpinned by the need to turn a profit - "greed" drives almost everything.

[Bettie]

7. Well, I'm seeing stories about record profits

so, they aren't being pinched as much as they say they are. CEOs getting big pay increases.

Feels like greed to me.

But, I'm sure there are those who will argue that those poor CEO's, just trying scrape by on tens of millions per year are the real victims here.

[GoCubsGo]

9. A substantial part of it.

Every time I go to the grocery store, I see empty shelves. Then I walk around the corner and see the aisle blocked by pallet after pallet of unstocked items. They're creating the illusion of shortages in order to jack up the prices.

I don't know how much of this is manufactured to hurt Biden. I suspect it's actually more to increase their profits, partly to make up for previous losses due to the pandemic, but mostly out of sheer greed. They're gouging because they can.

[Claustrum]

11. My aunt works at a hospital.

She has seen shortage of supplies for the last 6-9 months. The shortage is real. They have to switch from one time use disposables to reusable supplies. I think when hospitals can get their supplies, then the shortage is real. But, I don't know if every item is on a shortage so I can't rule out some item shortages are manufactured.

[Cyrano]

13. I tend to agree. And hurting Joe Biden is

just a side benefit that Republicans are probably gleeful about.

Big business can use a history lesson on this issue. German industrialists were absolutely certain they could control National Socialism and that they would profit hugely from it. Seems it didn't work out very well for them. Or countless millions of others. (By the way, National Socialists were better known by the term Nazis.)

[WarGamer]

12. Corporations are in business to make a profit for the shareholders.

When pesky things like Corporate Taxes, cost of materials, overhead and labor costs go up...

They increase the price of their goods or services to the consumer.

[Cyrano]

15. It seems that even when those things don't go up,

they increase the prices to consumers.

[Samrob]

16. My guess is about 90% ny

[JanMichael]

17. An amazing amount. Landlords are raising rents even though their own costs haven't gone up that much

Raising it because everybody else is raising it.

I know this for a fact because of the profession that I'm in and no one can convince me otherwise.

I know what capital reserves are on certain places I know what replacement reserves are I know they're vacancy rates and they're still trying to raise rents more than 10 to 15%.

It's greed pure and simple. It's gouging on a massive scale. And no one gives a s***.

As a simple example driving lights on my car used to cost $300 to install in 2019 that included the light kit. The light kit is the same price yet the dealer wants to charge $650 for the install. I know for a fact they did not raise everybody's salaries by that much. It's plug and Play. It's greed that's all it is.

[doc03]

18. Check out the management in any company. The

CEO and other top officers also sit on the board of directors in several other companies. If you are on the board of directors for x company you won't turn down a raise for their CEO because he is on the board of your company.

[moondust]

20. Maybe a lot.

Old Cynic wonders if some saw the big pandemic news as an opportunity to hype stories about supply chains, shortages, etc., that could be used to explain away price increases/gouging.

[Cyrano]

21. Many replies here indicate that capitalism sucks

The saying, "Capitalism is the worst system of all, except for all the others," was probably made up by some greedy pig with his snout buried in the trough.

In reading history, I've learned that the Kibbutzes established in Israel in the late 1940s and early 1950s were a great success. But they were based on (horrors) socialism. (Not the bullshit kind that existed in Russia.)

There really are systems that will benefit the majority. But there will always be a minority of Ayn Rand-type "superior people" who want and will take it all.

[Emile]

22. Predatory Capitalism is who to blame for inflation!

Jacking up prices to recoup losses during pandemic. Of course they will never blame capitalism, it will be the average working mans fault. Like that hourly worker called up OPEC and said raise the price of oil.

[pandr32]

23. Corporate greed for sure

The bonus is they attempt to tar Biden with it--including Manchin.

[IcyPeas]

25. 3M Corporation were praised for "driving price"

“According to a transcript of their earnings call in January, company executives applauded their own company for raising prices…”

Link to tweet

[spanone]

26. I don't understand why USED cars have skyrocketed?

Makes no sense to me.

[Tickle]

27. seven reasons why

The most commonly used measure to track inflation is the Consumer Price Index (CPI), which is compiled by the U.S. Bureau of Labor Statistics (BLS) each month. It tracks the average of prices of a set of goods and services in transportation, food, and healthcare.

1. The Economy Is Going Strong
When the economy is growing, more people have jobs, wages rise to hire and keep those workers, and more people have money to spend. As a result, they buy more necessities and some even splurge on new luxury items.

2. There Is More Currency Available
Inflation can also occur when the Fed, or another central bank, adds fiat currency into circulation at a rate that exceeds that of the economy’s growth rate. That creates a situation in which there are more dollars bidding on fewer goods and services. The result is that goods and services cost more.
3. Basic Materials Increase in Price
In the 1970s in the US, inflation was rampant. There were many reasons for this, but one major one was the OPEC oil embargoes. The embargoes led to a gas shortage, higher prices for home-heating oil, higher prices at the pump, and increases in the prices of manufacturing and shipping for nearly every single consumer good.
4. The Housing Market Takes Off
The housing
5. The Government Implements Expansionary Fiscal Policies
The federal government will occasionally try to jumpstart economic growth with new policies. These expansionary fiscal policies often seek to increase the amount of discretionary income that businesses and consumers have to spend.
market is a major part of the U.S. economy. And it has an outsized impact on the broader economy. When the housing market is strong and home prices are rising, then homeowners have more equity to call upon to make major purchases, which can goose inflation.
6. New Regulations Increase Costs
While a shortage of an essential commodity, like oil, can cause inflation, so can an increase in costs related to a commodity suddenly becoming more expensive because of government regulations.
7. The Exchange Rate Changes
The value of the U.S. dollar in relation to all other foreign currencies is constantly in flux. If the dollar goes down, then imported commodities and consumer goods get more expensive. But it also makes goods exported from the U.S. cheaper abroad, which can actually be a boost for the economy.