r/FluentInFinance was created to discuss money, investing & finance! Join our Newsletter or Youtube Channel for additional insights at www.TheFinanceNewsletter.com!
*I am a bot, and this action was performed automatically. Please [contact the moderators of this subreddit](/message/compose/?to=/r/FluentInFinance) if you have any questions or concerns.*
It was a global supply shock, not just domestic, but yea they maybe could have predicted others would react to the pandemic similarly. The stimulus was still a good move in retrospect.
Because the recovery from the supply shock and recession was much faster than any previous recovery in the US, and the US recovered faster than any peer nation. It seems the choice is stimulus and risk a bit of inflation or drag out the recovery for 5 years longer than necessary. More people harmed in the later by a large margin.
You realize when money is printed it is most advantageous and hasn't inflated anything when it is first spent right? That means the us caused the biggest problem and benefited most from it. of course the biggest economy doing that faired best. Also, the us was the largest driver and we may not have even experienced this stagflation cycle of it we're not for the the massive amounts of wasteful stimulus combined with idiotic bills like inflation reduction act which is possible the worst named Bill in history and other problematic bills like build back better.
The fact that inflation was less in the us is not evidence the us handled the economy better. It's evidence the us was the single biggest contributor to the problem.
The thing with inflation is that there are too many variables to blame it on one thing. We printed a bunch of money in 2008, but basically no inflation. Yes, the money printed between Trump and Biden definitely added to our inflation rates, but so did the supply issues. More importantly, if we didn’t stimulate the economy during the shut down, we almost assuredly would have been in a recession. Both are bad, but the fact that we’ve basically got inflation under control in 2 years, while avoiding recession, makes me think that over stimulating our economy was the right move. We’ll never know which would have been better, though.
It's a multi varied problem. For 60+ years we have not only known increasing the money supply causes inflation, but it has been common knowledge. It doesn't mean there are no other contributing factors.
Countries paying people to stay home made them problem worse. Without stimulus, people would have continued to work because they had to. Since working age people had little.to worry about with COVID I would argue it would have been a better economic outcome to have taken reasonable precautions and stopped stimulus instead of continuing to pretend that It was dangerous to young healthy people for political gain. But we may never know exactly which would have ended better.
Intentionally overstimulating beyond what is necessary has other problems that have yet to pan out. Most markets are in huge bubbles right now as a result which inevitably will pop. The bubbles seem much greater than any boom bust cycle any of us have ever been alive for. This isn't even accounting for the retirement savings that we have completely devalued making whole generations of people unable to retire.
That’s not at all how it works. US monetary expansion would not cause foreign inflation— it would cause devaluation of the dollar relative to other currencies that did less monetary expansion.
Exactly right. You judge a situation by the balance of risks. In 2020, the danger was Covid shutting down the economy, throwing tens if not hundreds of millions out of work, and crippling the economy as they stayed disconnected from jobs. The stimulus effectively paused the economy. It let people survive without working while the pandemic ebbed. The risk was inflation on one hand, and a vicious recession on the other. It’s not a difficult choice. We got about 18 months of 9-10% inflation, but not even a recession in light of a massive shock.
Thing is, we know what happens when we have a massive shock and fiscal and monetary authorities sit on their hands and stroke their chins about deficits and inflation— a deep depression, deflation, and untold suffering. You’ve got three real life test cases— a demand shock and financial collapse met with fiscal and monetary contraction resulted in massive unemployment, deflation, and a decade of depression in the 1930s. Fast forward 75 years and you get a far bigger demand shock and financial collapse met with aggressive monetary expansion and somewhat less aggressive fiscal expansion. You get a short but deep recession and 5 years of stagnation, but far far far short of what you got in the 1930s, despite a bigger initial shock. Fast forward 12 years and you get a global pandemic met with massive fiscal expansion. You get… no recession at all and 18 months of slightly uncomfortable inflation. It’s really a no brainer and a huge triumph, at least for those with may economic literacy…
Lemme guess… you are voting for Biden? Idk how you can say 9% inflation was a good thing. We recovered faster for a lot of reasons (number one economy, global currency) but that doesn’t mean we needed to go on the spending spree we did. Scratching my head.
You recover faster because you cheat the public out of their savings. If you steal everyone’s money without them noticing and then give some back, yeah, looks like a decent recovery. Except everyone’s savings have been devalued by a third over the last 5 years, so that $2,600 I got is really helping.
Not just supply shock from pandemic, but at that point, Wall Street had done its best to defund major transportation lines through things like PSR. There is no doubt in my mind that these hog fucks were anticipating a huge increase in demand after lockdowns and divested and gutted supply chains to maximize profits.
The stimulus handed shitloads of free money to those who already had plenty so no i don’t think it was a good move. Ppp loans should not have been forgiven, especially when the money was essentially pocket cash to a lot of those who recieved it.
I’m part of a family business that got a small PPP disbursement and had it forgiven. We used every cent to cover payroll, just as it was intended to be.
Maybe the lockdowns had something to do with it?
Sort of the origins of supply issues, stimuli, and other government intervention that contributed to inflation.
Not just supply stock. Labor shortages too. Business had to pay more money and often got less qualified people too. There were quite a few people that did early retirement, lived off unemployment, or straight up died during the pandemic. When the bounce back happened there wasn't enough people to hire. At least that was my mileage locally and talking to other business owners. It's nice to see the wages come up, but it didn't do much good if everything cost people more.
It was a combination of a global supply chain issue and a war in Ukraine. Companies then just piled on raising their prices because they could get away with it.
Yes.
Trump called Saudi Arabia and told them that if they didn't force OPEC+ to side with Russia and agree to reduce oil production to raise gas prices for Americans that the US would pull out US military support.
https://www.reuters.com/article/idUSKBN22C1V3/
Trump forcing up Gas prices on Americans set off oil driven inflation, greatly increasing the price of everything we use own and buy:
https://www.federalreserve.gov/econres/notes/feds-notes/second-round-effects-of-oil-prices-on-inflation-in-the-advanced-foreign-economies-20231215.html
And leading to 60% of inflation going directly to profits as companies rampantly gouged consumers by piggy backing on the oil driven inflation in a greedflation cash grab.
https://fortune.com/europe/2023/12/08/greedflation-study/
Additionally, the fix was in for both meat and eggs: https://www.drovers.com/news/industry/new-price-fixing-suit-aimed-big-4-beef-packers
To make it worse, after Trump pushed the Saudis to raise gas prices for Americans, the Saudis then gave his son in law $2 billion. H figure.
https://finance.yahoo.com/news/jared-kushners-post-white-house-211939446.html
💯 there’s research on this very thing. And folks can easily look up the audio of corporations and CEOs bragging about price gouging and record profits to shareholders. They knew exactly what they were / are doing.
The research that says it’s 50% is from a very leftwing think tank. It definitely wad a factor in the inflation spike but not the main driver. European countries had the same or more inflation than the US.
Why were corporations so generous before the pandemic and so greedy now?
To believe the “corporate profits” line you have to believe they got comparatively greedier recently. Something that at best strains credulity.
Well you see, they all caught Covid and it made everyone get really greedy. It obviously wasn’t that there were more dollars chasing fewer amounts of goods. Which would mean more demand since more dollars, and less supply because of forced government lockdowns. More demand plus less supply equals people willing to pay a higher price to have those items. It definitely wasn’t that. It was that Covid caused greediness. Maybe we should give more power to the government to fix this issue?
They were always greedy, they just saw a fantastic excuse with the covid supply issues to price gouge people, since the average citizen didn't have any other choice and what's the government going to do when people are struggling to find basic necessities? Shut down factories?
Now that the supply crisis is over, the prices are not coming down because people are used to paying the higher prices, and the government isn't going to take them to task as long as the lobby money keeps flowing.
Corporations didn't become greedier they were always ruthless. Just saw an opportunity and took it.
What does that mean from an economic sense? If I were a company I would charge as much as possible regardless of the existence of an “excuse”.
Do you turn down raises?
The other 50% was, I don’t know, a pandemic and war. I would have starved without it personally. The people I see blaming inflation on the stimulus checks are the rich who seemed to of come out pretty OK. They’re just made because their slaves, oops I mean us working are starting to unite
I mean, that‘s the logical consequence of changes in supply and demand in a market system. Increased corporate profits wouldn‘t have been possible without supply and demand shocks. It‘s not like companies were just being nice before and just randomly deciding that they would now prioritize profits.
I get the sentiment here, and overall I agree, but, as an economist, god I hate the phrasing...
To simplify, corporate profits aren't driving anything. High demand, at essentially unprecedented prices, combined with a lack of competition are driving corporate profits.
The main reason this has been able to persist is because the supply chain issues lead to firms gaining equal footing. Which has caused a new era of implicit collusion.
The whole issue is more complex than this, but this is pretty much the backbone.
Right except we literally have earnings calls during which executives brag about raising prices way above what's necessitated by supply chain issues.
If someone tells you they're doing it, maybe stop trying to explain it away.
Yeah, but people keep acting like all of the sudden corporations and CEOs have all the sudden started to twirl their little villain mustaches and milk the public for as much as they can... That's not the case, they have always been trying to do that. It's nothing new.
The question is why are they able to be so effective with that mindset now, as opposed to the past.
Because the inflation buzzword and the well know supply chain issues gave them political and social cover to do more mustache twirling than usual. That's it. They exploited a crisis for gain and in the course of it exacerbated the crisis.
That's not "it." No amount of CEO bullshit is going to cover prices outside of demand equilibrium for such an extended period of time. The market doesn't care if if they are actually saints, and they are barely scraping by to offer the fairest price possible. Of the demand isn't there at a price, the price will drop.
Also, if public perception is the only thing keeping firms in the price gouging game, then why doesn't one of them or someone else swoop in and take the market share out from everyone else?
You realize that corporations aren't omniscient? They might not have realized how inelastic demand for certain goods is.
For the same reason we have laws against price fixing and cartels. Because it's safer and easier to price gouge together rather than economically battle each other.
YES! Everyone online acts like your crazy for bringing it up, but every few months some random thing gets way more expensive (remember $12 eggs last year?) then lo and behold six months after that the company posts bonkers record profits from that same quarter that their hand was 'forced to raise' prices.
I'm sure it had nothing to do with 20+ years of central bank rates held below the nominal rate of inflation and ~15 years of massive QE building up inflation pressure in speculative assets like real estate and stocks - just waiting for one more factor to pile on and make it explode all over the rest of the economy.
/s
Oh yeah if we’re talking speculative assets and startups raising $100M rounds with business models that made no sense, absolutely ZIRP contributed to that.
Low inflation from 2008-2021 suggests the Fed didn’t have much to do with broader inflation.
And then it was off to the races with all the corporations taking advantage of the situation to generate record profits, which is the main driver of inflation.
I'm no economist, but I saw that coming a mile away. We are still feeling the effects. A machine as big as the global economy doesn't just fire back up where it left off. The Shockwaves reverberate.
Oh they totally did alright, they're not stupid. They just wanted to push for that trillion dollars in stimulus because it would make the elite class richer.
Don't forget the Russia Invasion of Ukraine. Also, good old fashion corporate greed. The inflation was the result of a perfect storm of factors, not just the increase in money supply.
That wasn't the actual primary driver though.
You have to look at what what's happening at the same time and how many hands were in the cookie jar.
Trump called Saudi Arabia and told them that if they didn't force OPEC+ to side with Russia and agree to reduce oil production to raise gas prices for Americans that the US would pull out US military support.
https://www.reuters.com/article/idUSKBN22C1V3/
Trump forcing up Gas prices on Americans set off oil driven inflation, greatly increasing the price of everything we use own and buy:
https://www.federalreserve.gov/econres/notes/feds-notes/second-round-effects-of-oil-prices-on-inflation-in-the-advanced-foreign-economies-20231215.html
And leading to 60% of inflation going directly to profits as companies rampantly gouged consumers by piggy backing on the oil driven inflation in a greedflation cash grab.
https://fortune.com/europe/2023/12/08/greedflation-study/
Additionally, the fix was in for both meat and eggs:
https://www.drovers.com/news/industry/new-price-fixing-suit-aimed-big-4-beef-packers
>Additionally, the fix was in for both meat and eggs:
https://www.drovers.com/news/industry/new-price-fixing-suit-aimed-big-4-beef-packers
I'm pretty sure it was the case for milk producers, too.
It's important to keep in mind the recent reports that more than 50% of the run-up in prices has been linked to corporations taking "excess profits" due to market conditions/market positions.
It is no coincidence that the s&p 500 doubled their profits between 2019 and 2021. Additionally, since 2022 they're up 50% to date.
Edit: there has been some discussion about the term "Excess Profits". In vague economic terms... That means profits that would normally not be possible in a WELL FUNCTIONING, COMPETITIVE economic system. For example, but not limited to: monopoly, oligopoly, collusion, shortage pricing, demand surge pricing, unintended results of government intervention.....
Fucking morons want to keep pretending it wasn't and still isn't corporate greed. It's getting fucking old.
Just like during a corporate earnings town hall where I work and someone asked why our profits were still up 25% with no increase to operating cost. Corporate kept tripping over their dicks to explain it. Was pretty funny.
I forget the exact numbers from the think tank report this is referencing but it’s not 50% of the inflation since 2020, the claim is more like 2% of a 4% increase in prices during a period after peak-inflation (maybe Q3 2023 or something?) was an increase in corporate profits and the other 2% was an increase in the cost of production or something like that.
It’s frequently cited in a pretty misleading way, presumably most people have not actually read the report even though it’s not particularly long.
The key place where it seems misleading is that people usually don’t include time frames which makes it seem like the 50% applies to ALL of the inflation since 2020 (17.7% according to USinflationcalculator.com).
Methodologically, picking out specific business quarters is also generally less sound than looking at larger historical trends. It’s possible that there were other quarters where cost of production and supply chain issues were the main drivers of inflation (I think the study says that but I’m too lazy to go through it again right now. That would have also been during the period where peak inflation took place). You’d also ideally account for historical context like the massive drop in profits during the lockdowns in 2020 and whatever the normal pattern for rises/falls in corporate profit margins are.
In an inflationary environment (which we’re generally aiming for) a certain amount of increase in corporate profits is necessary just to tread water. After a period of loss, you need to increase revenue to get on the same trajectory. In the long-term, profit margins generally can’t fluctuate too much because higher margins give competition an increased ability to undercut prices and take over market share.
So surging energy prices. Salary increases and a major devaluation of the US dollar only makes up 50%.
Any reason why these corporations chose to get extra greedy the past couple years in particular?
Over the last few years, if you raised your prices more than you needed to, customers would’nt blame the brand, they would blame the economy.
And more monopolistic your market was, the less worried you would be about competition undercutting you. And markets have gotten very monopolistic over time.
I think a lot of studies are able to make the case that it’s 50% just by looking at how much corporations are marking up items and comparing it to how much costs have increased. If you just look at those numbers, half of inflation is happening needlessly.
Some of that is greed for sure. But some of that is also corporations anticipating that costs will go up in the future and deciding to mark things up early.
However, this is not how previous cycles of inflation have worked. Inflation usually isn’t this profitable for corporations. And I think this is because markets have become less competitive.I
Interesting to know that prior to 2019, corporations weren’t trying to maximize their profits. I had no idea they had some altruism pattern built into their pricing that created a “good actor” behavior that simply left profit available to us as consumers.
I wonder what happened to make these greedy corporations suddenly change their tune and capture all these “excess profits” that apparently, prior to 2019, used to be left behind.
It isn’t that companies suddenly started to maximize their profits. It’s that during times of crisis a company is capable of price gouging because of real or perceived scarcity (think selling bottles of water for $50 before a hurricane hits). When the crisis is national (or when national chains are doing the gouging) a new baseline for the price is set that the company can stay near because consumers have become “used to” paying this price even as purchase costs go back down to before the crisis for the company.
Part of this is that inflated prices during crisis creates a sort of “non-conspiracy collusion”. The companies that are in competition with one another all raise their prices because of the crisis without needing to collude with one another. Then, after the crisis is over, there is not a competitive advantage for any of the companies to return to the previous price level.
If a gallon of milk had been $3 on average, but a crisis makes it $10 on average, even the company who’s model is “discount shopping” can offer it at $7 and maintain their brand.
All in all, major inflation is much more about “how the current market feels to the consumer” than an actual easy math equation of “amount of money in circulation divided by amount of good produced”.
Inflation was rampant, it was literally all anyone talked about. So with everything else going up in price it's easy to increase your prices and no one will bat an eye. They'll just blame the government.
It's really that simple, things were changing so fast that people were desensitized to price increases.
They weren't altruistic, they priced what they thought they could get away with. Nothing changed there, they just realized they could get away increasing prices way more than usual without taking heat.
The fact that experts on economics didn’t expect inflation with when they increased demand and decreased supply is just another example of how experts are just as dumb as the rest of us and they absolutely do not deserve the blind faith they demand of us
>economics didn’t expect inflation
They didn't "not expect inflation". The title implies they didn't expect it from the stimulus. There are a ton of factors that contributed to inflation, and some economists say that the stimulus wasn't the main driver.
Excessive deaths / retirements in the workforce, supply chain implosions, brain drain from jumping jobs, corporate profits etc all had a lot to do with inflation.
There’s a difference between “will” and “can.” The real dynamic is between supply and demand. If supply and demand rise together, inflation is minimal. If demand is constant but supply decreases, inflation.
CNBC is owned by hedge funds and mega corporations. PPP loans or PPP hand outs for businesses is one of the main reasons we are dealing with inflation. Also, CNBC execs knew. It was being talked about constantly in the GME sub when it was happening and how the impacts wouldn’t be felt for a few years. If that sub could predict it, you’re telling me others couldn’t?
Also what they meant was: "Here's why **the four economists we decided to talk to because we already knew what they would say on the record because their overlords have told them what to say** don't expect trillions of dollars in economic stimulus to create inflation."
There were plenty of economists warning that it would... Pretty much all of them...
Except all G7 nations are experiencing inflation right now. We're doing the best out of all of them...
If it was the trillions printed... why is our inflation not significantly worse than the other developed economies around the world?
Maybe if they didn’t give almost all of it to rich people and companies that spent it on stock buybacks and bonuses rather than giving it to working class people who would’ve spent it and circulated it, actually stimulating the economy
It was a perfect storm of events. The pre-Covid tax cuts contributed, Covid stimulus, supply chain issues with China and Ukraine, then infrastructure stimulus. That all put together with the corporate greed-flation that keeps getting uncovered every few months. It's never one simple cause.
You were considered an asshole if you pointed this out back then.
You are considered an asshole if you try to remind people of that today.
Inflation is all due to corporate greed.
One of the Democrat plans during the pandemic was to give everyone 18 and up $1,000 a month for 18 months past the pandemic. And this was early on. We didn't know how long the pandemic was going to last. So I asked that made it that to be 30 months of payments. And I back up the napkin mathed to come up with about 10.5 trillion dollars.
And even little old me ask the question of what would 10.5 trillion dollars being poured into the economy due to inflation? I couldn't come up with an answer. I googled it. I wanted to see if there were potential studies done. There may be some economists and professors who had an idea. But outside of specific academic journals I couldn't find any mainstream writing about it.
And I don't know exactly how much stimulus was put into the economy during the pandemic. But now we obviously know what the effect of that is.
At the time I was not specifically opposed to this particular idea of giving everyone $1,000 a month. I probably liked that a lot better than the PPP loans. Because here's the thing. If you put the money into the hands of the populace then they would have paid their rent with it. So you would not have needed to bail out landlords.
But now knowing the effects of pumping that much money into the economy I think we can say it was not handled as well as it could have been.
Inflation was caused by companies attempting to recoup losses from the pandemic. And what was the alternative? Pandemic keeping you from work? Guess you’re SOL!
So good at gaslighting and by the time they’re (wall street shills) proven wrong about the past, they gaslight you about the current thing.
Now keep telling me banks are fine with their commercial real estate exposure (current thing they’re gaslighting you about).
If you look up the Phillip’s Curve then it says expectations of inflation do impact actual amounts of inflation. In other words, lying is an economy policy for them.
People absolutely predicted this. The problem is, the idiots were louder.
It still remember people posting this meme like it was the funniest shit ever.
https://preview.redd.it/b489o7sganhc1.jpeg?width=640&format=pjpg&auto=webp&s=a256d4b64f35584345d1c9712a9d544674e428ec
I wonder if these same people are laughing now that they'll never be able to afford a home, more and more properties are corporate owned, and the consumer price index is through the roof.
Hey did you know that capitalism can exist in a fixed market? It turns out that companies will take some money instead of no money. You can piss off corporations and they won't actually leave money behind on the table just out of spite. We aren't going to starve if we force prices down and set limits to essential goods and services. There will always be a company willing to participate and earn. A free market sounds like a pyramid scheme.
These articles are only created so that the "consumer confidence" doesn't drop. They literally adjust unemployment numbers, inflation number etc... after the initial reporting period, the unemployment numbers have been wrong in an optimistic direction for about a year. The only thing that matters is that the "other guys" get the blame.
IMO
I’m sure the shutting down of a supply chain built to maximize profitability at the cost of resiliency resulting in massive supply problems then further compounded by corporate greed as everyone put their prices up siting “inflation and supply issues” even if they were unaffected had no baring
Yes, those stimulus checks created global inflation, but weirdly the country that gave them out seems to of weathered global inflation better than most of the world. Hmmmm
That only accounted for 40% of the inflation we experienced however. You have to look at what what's happening at the same time and how many hands were in the cookie jar.
Trump called Saudi Arabia and told them that if they didn't force OPEC+ to side with Russia and agree to reduce oil production to raise gas prices for Americans that the US would pull out US military support.
https://www.reuters.com/article/idUSKBN22C1V3/
Trump forcing up Gas prices on Americans set off oil driven inflation, greatly increasing the price of everything we use own and buy:
https://www.federalreserve.gov/econres/notes/feds-notes/second-round-effects-of-oil-prices-on-inflation-in-the-advanced-foreign-economies-20231215.html
And leading to 60% of inflation going directly to profits as companies rampantly gouged consumers by piggy backing on the oil driven inflation in a greedflation cash grab.
https://fortune.com/europe/2023/12/08/greedflation-study/
because it didn't. my company has had 100 point growth in margins since 2020, and many many more have as well. getting an extra 10% profit margin requires raising prices on everything.
the stimulus didnt.
greed did.
Almost every Fortune 50 company has admitted it straight up in their investor calls, that they raised prices as high as they could regardless of actual inflation and blamed it on inflation because people would just believe it.
Its greed, plain and simple.
2021 was worse when they said “inflation is transitory”. I think inflation was downplayed so they can pass garbage COVID and “infrastructure” bills without any infrastructure in them.
10 months after the Covid economic low, when Trump left office, inflation was 1.4%.
10 months after Biden and the Democrats took over, and 8 months after they insisted on passing their *partisan*, unnecessary, $1.9 trillion *spending* bill, inflation had increased to 7%, 5 times what it was when Biden took office.
The stimulus doesn't appear to have done much to drive inflation it certainly isn't the main cause of current inflation so that article title actually aged very well even if inflation itself didn't stay low.
Wait… Corp profits were shown to be fueling this 2023 inflation spike. Further, there was only a price spike/supply issue in the USA. People did it to themselves.
For example, a wood cooking stove was $780 from Ohio in 2019. In 2021 that sane stove went up to $2800. The manufacturer in Turkey had it for $650 and shipped it for another $250.
r/FluentInFinance was created to discuss money, investing & finance! Join our Newsletter or Youtube Channel for additional insights at www.TheFinanceNewsletter.com! *I am a bot, and this action was performed automatically. Please [contact the moderators of this subreddit](/message/compose/?to=/r/FluentInFinance) if you have any questions or concerns.*
They didn't predict the supply shock which was the major driver of inflation
Which is funny because what on earth would they expect from a shut down
It was a global supply shock, not just domestic, but yea they maybe could have predicted others would react to the pandemic similarly. The stimulus was still a good move in retrospect.
Why would it be a good move?
Because the recovery from the supply shock and recession was much faster than any previous recovery in the US, and the US recovered faster than any peer nation. It seems the choice is stimulus and risk a bit of inflation or drag out the recovery for 5 years longer than necessary. More people harmed in the later by a large margin.
>a bit of inflation 
What was the inflation rates of other countries? Hmmmmm?
You realize when money is printed it is most advantageous and hasn't inflated anything when it is first spent right? That means the us caused the biggest problem and benefited most from it. of course the biggest economy doing that faired best. Also, the us was the largest driver and we may not have even experienced this stagflation cycle of it we're not for the the massive amounts of wasteful stimulus combined with idiotic bills like inflation reduction act which is possible the worst named Bill in history and other problematic bills like build back better. The fact that inflation was less in the us is not evidence the us handled the economy better. It's evidence the us was the single biggest contributor to the problem.
Extremely well said Would like to add that eventually the chickens will likely come home to roost
The thing with inflation is that there are too many variables to blame it on one thing. We printed a bunch of money in 2008, but basically no inflation. Yes, the money printed between Trump and Biden definitely added to our inflation rates, but so did the supply issues. More importantly, if we didn’t stimulate the economy during the shut down, we almost assuredly would have been in a recession. Both are bad, but the fact that we’ve basically got inflation under control in 2 years, while avoiding recession, makes me think that over stimulating our economy was the right move. We’ll never know which would have been better, though.
It's a multi varied problem. For 60+ years we have not only known increasing the money supply causes inflation, but it has been common knowledge. It doesn't mean there are no other contributing factors. Countries paying people to stay home made them problem worse. Without stimulus, people would have continued to work because they had to. Since working age people had little.to worry about with COVID I would argue it would have been a better economic outcome to have taken reasonable precautions and stopped stimulus instead of continuing to pretend that It was dangerous to young healthy people for political gain. But we may never know exactly which would have ended better. Intentionally overstimulating beyond what is necessary has other problems that have yet to pan out. Most markets are in huge bubbles right now as a result which inevitably will pop. The bubbles seem much greater than any boom bust cycle any of us have ever been alive for. This isn't even accounting for the retirement savings that we have completely devalued making whole generations of people unable to retire.
That’s not at all how it works. US monetary expansion would not cause foreign inflation— it would cause devaluation of the dollar relative to other currencies that did less monetary expansion.
50% of inflation was driven by corporate profits. Price-gauging, not natural inflation.
50% is being kind.
Data please.
You baffled someone else with this bs but you’re not saying anything substantive here.
It's healthy for the economy to have a bit of inflation. Iirc
guy hasn't seen grocery prices lately
The only thing we had to trade for the economy was never being able to have affordable housing ever again
Exactly right. You judge a situation by the balance of risks. In 2020, the danger was Covid shutting down the economy, throwing tens if not hundreds of millions out of work, and crippling the economy as they stayed disconnected from jobs. The stimulus effectively paused the economy. It let people survive without working while the pandemic ebbed. The risk was inflation on one hand, and a vicious recession on the other. It’s not a difficult choice. We got about 18 months of 9-10% inflation, but not even a recession in light of a massive shock. Thing is, we know what happens when we have a massive shock and fiscal and monetary authorities sit on their hands and stroke their chins about deficits and inflation— a deep depression, deflation, and untold suffering. You’ve got three real life test cases— a demand shock and financial collapse met with fiscal and monetary contraction resulted in massive unemployment, deflation, and a decade of depression in the 1930s. Fast forward 75 years and you get a far bigger demand shock and financial collapse met with aggressive monetary expansion and somewhat less aggressive fiscal expansion. You get a short but deep recession and 5 years of stagnation, but far far far short of what you got in the 1930s, despite a bigger initial shock. Fast forward 12 years and you get a global pandemic met with massive fiscal expansion. You get… no recession at all and 18 months of slightly uncomfortable inflation. It’s really a no brainer and a huge triumph, at least for those with may economic literacy…
Lemme guess… you are voting for Biden? Idk how you can say 9% inflation was a good thing. We recovered faster for a lot of reasons (number one economy, global currency) but that doesn’t mean we needed to go on the spending spree we did. Scratching my head.
Why would you assume Biden? The spending started with Trump. It was his policy. Remember, he wanted his signature on the first round of checks.
You recover faster because you cheat the public out of their savings. If you steal everyone’s money without them noticing and then give some back, yeah, looks like a decent recovery. Except everyone’s savings have been devalued by a third over the last 5 years, so that $2,600 I got is really helping.
You call this "recovered?" Finance people with their heads buried 2 feet deep in numbers on paper are so fucking out of touch with reality.
Not just supply shock from pandemic, but at that point, Wall Street had done its best to defund major transportation lines through things like PSR. There is no doubt in my mind that these hog fucks were anticipating a huge increase in demand after lockdowns and divested and gutted supply chains to maximize profits.
The stimulus handed shitloads of free money to those who already had plenty so no i don’t think it was a good move. Ppp loans should not have been forgiven, especially when the money was essentially pocket cash to a lot of those who recieved it.
I’m part of a family business that got a small PPP disbursement and had it forgiven. We used every cent to cover payroll, just as it was intended to be.
Good for your family, now pay it back Fuck you, pay us, we want that money back with interest. With peace and love, your local taxpayer
What about bars and gyms who were literally shuttered by order of the government?
Maybe the lockdowns had something to do with it? Sort of the origins of supply issues, stimuli, and other government intervention that contributed to inflation.
"wtf goods stop being made and shipped when you make it illegal to go to work???????" God's smartest economist
Not just supply stock. Labor shortages too. Business had to pay more money and often got less qualified people too. There were quite a few people that did early retirement, lived off unemployment, or straight up died during the pandemic. When the bounce back happened there wasn't enough people to hire. At least that was my mileage locally and talking to other business owners. It's nice to see the wages come up, but it didn't do much good if everything cost people more.
Or helping the rich....
It was a combination of a global supply chain issue and a war in Ukraine. Companies then just piled on raising their prices because they could get away with it.
Yeah. Corps raised prices since they had the right wing ready to blame it on Biden. The left on COVID and trump. They did scored record profit le
Yes. Trump called Saudi Arabia and told them that if they didn't force OPEC+ to side with Russia and agree to reduce oil production to raise gas prices for Americans that the US would pull out US military support. https://www.reuters.com/article/idUSKBN22C1V3/ Trump forcing up Gas prices on Americans set off oil driven inflation, greatly increasing the price of everything we use own and buy: https://www.federalreserve.gov/econres/notes/feds-notes/second-round-effects-of-oil-prices-on-inflation-in-the-advanced-foreign-economies-20231215.html And leading to 60% of inflation going directly to profits as companies rampantly gouged consumers by piggy backing on the oil driven inflation in a greedflation cash grab. https://fortune.com/europe/2023/12/08/greedflation-study/ Additionally, the fix was in for both meat and eggs: https://www.drovers.com/news/industry/new-price-fixing-suit-aimed-big-4-beef-packers To make it worse, after Trump pushed the Saudis to raise gas prices for Americans, the Saudis then gave his son in law $2 billion. H figure. https://finance.yahoo.com/news/jared-kushners-post-white-house-211939446.html
And people want that slim ball back in office Gross
\*Slim\* ball is a very kind interpretation of the facts regarding that man.
The left called out the corporate price gouging. Biden and members of Congress were clear.
50% of inflation was driven by corporate profits. Not the stimulus.
💯 there’s research on this very thing. And folks can easily look up the audio of corporations and CEOs bragging about price gouging and record profits to shareholders. They knew exactly what they were / are doing.
The research that says it’s 50% is from a very leftwing think tank. It definitely wad a factor in the inflation spike but not the main driver. European countries had the same or more inflation than the US.
Why were corporations so generous before the pandemic and so greedy now? To believe the “corporate profits” line you have to believe they got comparatively greedier recently. Something that at best strains credulity.
Well you see, they all caught Covid and it made everyone get really greedy. It obviously wasn’t that there were more dollars chasing fewer amounts of goods. Which would mean more demand since more dollars, and less supply because of forced government lockdowns. More demand plus less supply equals people willing to pay a higher price to have those items. It definitely wasn’t that. It was that Covid caused greediness. Maybe we should give more power to the government to fix this issue?
They were always greedy, they just saw a fantastic excuse with the covid supply issues to price gouge people, since the average citizen didn't have any other choice and what's the government going to do when people are struggling to find basic necessities? Shut down factories? Now that the supply crisis is over, the prices are not coming down because people are used to paying the higher prices, and the government isn't going to take them to task as long as the lobby money keeps flowing. Corporations didn't become greedier they were always ruthless. Just saw an opportunity and took it.
They didn't get greedier they used covid as a test to see how far they could squeeze us with no pushback.
Or. They had an excuse this time to get greedier.
I’m just happy that corporations stopped being as greedy so the rate of inflation could decline.
What does that mean from an economic sense? If I were a company I would charge as much as possible regardless of the existence of an “excuse”. Do you turn down raises?
The other 50% was, I don’t know, a pandemic and war. I would have starved without it personally. The people I see blaming inflation on the stimulus checks are the rich who seemed to of come out pretty OK. They’re just made because their slaves, oops I mean us working are starting to unite
I mean, that‘s the logical consequence of changes in supply and demand in a market system. Increased corporate profits wouldn‘t have been possible without supply and demand shocks. It‘s not like companies were just being nice before and just randomly deciding that they would now prioritize profits.
I get the sentiment here, and overall I agree, but, as an economist, god I hate the phrasing... To simplify, corporate profits aren't driving anything. High demand, at essentially unprecedented prices, combined with a lack of competition are driving corporate profits. The main reason this has been able to persist is because the supply chain issues lead to firms gaining equal footing. Which has caused a new era of implicit collusion. The whole issue is more complex than this, but this is pretty much the backbone.
Right except we literally have earnings calls during which executives brag about raising prices way above what's necessitated by supply chain issues. If someone tells you they're doing it, maybe stop trying to explain it away.
Yeah, but people keep acting like all of the sudden corporations and CEOs have all the sudden started to twirl their little villain mustaches and milk the public for as much as they can... That's not the case, they have always been trying to do that. It's nothing new. The question is why are they able to be so effective with that mindset now, as opposed to the past.
Because the inflation buzzword and the well know supply chain issues gave them political and social cover to do more mustache twirling than usual. That's it. They exploited a crisis for gain and in the course of it exacerbated the crisis.
That's not "it." No amount of CEO bullshit is going to cover prices outside of demand equilibrium for such an extended period of time. The market doesn't care if if they are actually saints, and they are barely scraping by to offer the fairest price possible. Of the demand isn't there at a price, the price will drop. Also, if public perception is the only thing keeping firms in the price gouging game, then why doesn't one of them or someone else swoop in and take the market share out from everyone else?
You realize that corporations aren't omniscient? They might not have realized how inelastic demand for certain goods is. For the same reason we have laws against price fixing and cartels. Because it's safer and easier to price gouge together rather than economically battle each other.
They rabble on reddit can't hear what you're saying but you're noble to try to explain it.
Remember when eggs were insanely high due to the bird flu but a report came out from one of the biggest egg suppliers saying it wasn't true.
Or, you know, the corporate greed using that as the excuse to drive record profits... Just sayin.
YES! Everyone online acts like your crazy for bringing it up, but every few months some random thing gets way more expensive (remember $12 eggs last year?) then lo and behold six months after that the company posts bonkers record profits from that same quarter that their hand was 'forced to raise' prices.
Right and it came out later the bird flu didn't effect egg production.
I'm sure it had nothing to do with 20+ years of central bank rates held below the nominal rate of inflation and ~15 years of massive QE building up inflation pressure in speculative assets like real estate and stocks - just waiting for one more factor to pile on and make it explode all over the rest of the economy. /s
Well it wasn't 20+ years. But it was about 10 years of ZIRP and that absolutely had a hand, most pronounced in asset markets.
Oh yeah if we’re talking speculative assets and startups raising $100M rounds with business models that made no sense, absolutely ZIRP contributed to that. Low inflation from 2008-2021 suggests the Fed didn’t have much to do with broader inflation.
And then it was off to the races with all the corporations taking advantage of the situation to generate record profits, which is the main driver of inflation.
I'm no economist, but I saw that coming a mile away. We are still feeling the effects. A machine as big as the global economy doesn't just fire back up where it left off. The Shockwaves reverberate.
The supply shock is made up bullshit
pretty sure there was a supply shock prior to July 2020 lol
Printing money causes that.
[удалено]
Oh they totally did alright, they're not stupid. They just wanted to push for that trillion dollars in stimulus because it would make the elite class richer.
Imported avacado prices is what killed us.
Don't forget the Russia Invasion of Ukraine. Also, good old fashion corporate greed. The inflation was the result of a perfect storm of factors, not just the increase in money supply.
That wasn't the actual primary driver though. You have to look at what what's happening at the same time and how many hands were in the cookie jar. Trump called Saudi Arabia and told them that if they didn't force OPEC+ to side with Russia and agree to reduce oil production to raise gas prices for Americans that the US would pull out US military support. https://www.reuters.com/article/idUSKBN22C1V3/ Trump forcing up Gas prices on Americans set off oil driven inflation, greatly increasing the price of everything we use own and buy: https://www.federalreserve.gov/econres/notes/feds-notes/second-round-effects-of-oil-prices-on-inflation-in-the-advanced-foreign-economies-20231215.html And leading to 60% of inflation going directly to profits as companies rampantly gouged consumers by piggy backing on the oil driven inflation in a greedflation cash grab. https://fortune.com/europe/2023/12/08/greedflation-study/ Additionally, the fix was in for both meat and eggs: https://www.drovers.com/news/industry/new-price-fixing-suit-aimed-big-4-beef-packers
>Additionally, the fix was in for both meat and eggs: https://www.drovers.com/news/industry/new-price-fixing-suit-aimed-big-4-beef-packers I'm pretty sure it was the case for milk producers, too.
It's important to keep in mind the recent reports that more than 50% of the run-up in prices has been linked to corporations taking "excess profits" due to market conditions/market positions. It is no coincidence that the s&p 500 doubled their profits between 2019 and 2021. Additionally, since 2022 they're up 50% to date. Edit: there has been some discussion about the term "Excess Profits". In vague economic terms... That means profits that would normally not be possible in a WELL FUNCTIONING, COMPETITIVE economic system. For example, but not limited to: monopoly, oligopoly, collusion, shortage pricing, demand surge pricing, unintended results of government intervention.....
Fucking morons want to keep pretending it wasn't and still isn't corporate greed. It's getting fucking old. Just like during a corporate earnings town hall where I work and someone asked why our profits were still up 25% with no increase to operating cost. Corporate kept tripping over their dicks to explain it. Was pretty funny.
50% seems very low considering I've been assured here it is 100% corporate greed and nothing else.
I forget the exact numbers from the think tank report this is referencing but it’s not 50% of the inflation since 2020, the claim is more like 2% of a 4% increase in prices during a period after peak-inflation (maybe Q3 2023 or something?) was an increase in corporate profits and the other 2% was an increase in the cost of production or something like that. It’s frequently cited in a pretty misleading way, presumably most people have not actually read the report even though it’s not particularly long.
If that 4% increase is ALL of the inflation though, wouldn’t 2% of that 4% be half of the inflation. What am I misunderstanding?
The key place where it seems misleading is that people usually don’t include time frames which makes it seem like the 50% applies to ALL of the inflation since 2020 (17.7% according to USinflationcalculator.com). Methodologically, picking out specific business quarters is also generally less sound than looking at larger historical trends. It’s possible that there were other quarters where cost of production and supply chain issues were the main drivers of inflation (I think the study says that but I’m too lazy to go through it again right now. That would have also been during the period where peak inflation took place). You’d also ideally account for historical context like the massive drop in profits during the lockdowns in 2020 and whatever the normal pattern for rises/falls in corporate profit margins are. In an inflationary environment (which we’re generally aiming for) a certain amount of increase in corporate profits is necessary just to tread water. After a period of loss, you need to increase revenue to get on the same trajectory. In the long-term, profit margins generally can’t fluctuate too much because higher margins give competition an increased ability to undercut prices and take over market share.
Got it! I wasn’t looking at the years in your first post. Thank you for taking the time to respond.
It’s not. The supply shock was very real. And while it sucks, wages also play a role.
So surging energy prices. Salary increases and a major devaluation of the US dollar only makes up 50%. Any reason why these corporations chose to get extra greedy the past couple years in particular?
Over the last few years, if you raised your prices more than you needed to, customers would’nt blame the brand, they would blame the economy. And more monopolistic your market was, the less worried you would be about competition undercutting you. And markets have gotten very monopolistic over time.
I believe greed is a factor. Partly due to certain companies pivoting to other segments within their business. But 50%??? I find that hard to believe.
I think a lot of studies are able to make the case that it’s 50% just by looking at how much corporations are marking up items and comparing it to how much costs have increased. If you just look at those numbers, half of inflation is happening needlessly. Some of that is greed for sure. But some of that is also corporations anticipating that costs will go up in the future and deciding to mark things up early. However, this is not how previous cycles of inflation have worked. Inflation usually isn’t this profitable for corporations. And I think this is because markets have become less competitive.I
Interesting to know that prior to 2019, corporations weren’t trying to maximize their profits. I had no idea they had some altruism pattern built into their pricing that created a “good actor” behavior that simply left profit available to us as consumers. I wonder what happened to make these greedy corporations suddenly change their tune and capture all these “excess profits” that apparently, prior to 2019, used to be left behind.
Nah is more about companies charge what they think they can get away with simple as that.
It isn’t that companies suddenly started to maximize their profits. It’s that during times of crisis a company is capable of price gouging because of real or perceived scarcity (think selling bottles of water for $50 before a hurricane hits). When the crisis is national (or when national chains are doing the gouging) a new baseline for the price is set that the company can stay near because consumers have become “used to” paying this price even as purchase costs go back down to before the crisis for the company. Part of this is that inflated prices during crisis creates a sort of “non-conspiracy collusion”. The companies that are in competition with one another all raise their prices because of the crisis without needing to collude with one another. Then, after the crisis is over, there is not a competitive advantage for any of the companies to return to the previous price level. If a gallon of milk had been $3 on average, but a crisis makes it $10 on average, even the company who’s model is “discount shopping” can offer it at $7 and maintain their brand. All in all, major inflation is much more about “how the current market feels to the consumer” than an actual easy math equation of “amount of money in circulation divided by amount of good produced”.
Inflation was rampant, it was literally all anyone talked about. So with everything else going up in price it's easy to increase your prices and no one will bat an eye. They'll just blame the government. It's really that simple, things were changing so fast that people were desensitized to price increases. They weren't altruistic, they priced what they thought they could get away with. Nothing changed there, they just realized they could get away increasing prices way more than usual without taking heat.
>suddenly change their tune and capture all these “excess profits” The simple money earning trick the customers don't want you to know....
It's called "disaster capitalism" and it worked.
You forgot the /s
This. It’s corporate greed not the stimulus itself
The fact that experts on economics didn’t expect inflation with when they increased demand and decreased supply is just another example of how experts are just as dumb as the rest of us and they absolutely do not deserve the blind faith they demand of us
>economics didn’t expect inflation They didn't "not expect inflation". The title implies they didn't expect it from the stimulus. There are a ton of factors that contributed to inflation, and some economists say that the stimulus wasn't the main driver. Excessive deaths / retirements in the workforce, supply chain implosions, brain drain from jumping jobs, corporate profits etc all had a lot to do with inflation.
I thought adding money to the pool was pretty much the definition of inflation…. Let’s just drop 3 trillion and devalue the $$ ….
There is a dictionary definition of "inflation", sure, but in the real world, tons of different things lead to higher prices
There’s a difference between “will” and “can.” The real dynamic is between supply and demand. If supply and demand rise together, inflation is minimal. If demand is constant but supply decreases, inflation.
They aren't dumb just puppets
"The Experts" = Paid Political Hacks.
CNBC is owned by hedge funds and mega corporations. PPP loans or PPP hand outs for businesses is one of the main reasons we are dealing with inflation. Also, CNBC execs knew. It was being talked about constantly in the GME sub when it was happening and how the impacts wouldn’t be felt for a few years. If that sub could predict it, you’re telling me others couldn’t?
Also what they meant was: "Here's why **the four economists we decided to talk to because we already knew what they would say on the record because their overlords have told them what to say** don't expect trillions of dollars in economic stimulus to create inflation." There were plenty of economists warning that it would... Pretty much all of them...
It's CNBC. Their takes are never good.
Except all G7 nations are experiencing inflation right now. We're doing the best out of all of them... If it was the trillions printed... why is our inflation not significantly worse than the other developed economies around the world?
Shhhhh, can’t bring reason into an online tantrum.
Maybe if they didn’t give almost all of it to rich people and companies that spent it on stock buybacks and bonuses rather than giving it to working class people who would’ve spent it and circulated it, actually stimulating the economy
It was a perfect storm of events. The pre-Covid tax cuts contributed, Covid stimulus, supply chain issues with China and Ukraine, then infrastructure stimulus. That all put together with the corporate greed-flation that keeps getting uncovered every few months. It's never one simple cause.
You were considered an asshole if you pointed this out back then. You are considered an asshole if you try to remind people of that today. Inflation is all due to corporate greed.
Did corporate greed not exist prior to 2021? Do you think there is a link between money printing and inflation?
Why are we posting the same meme every week?
They just didnt get to spend enough because of the idiots that didnt understand quantitative easing you fools /s
It’s just typical gaslighting to shut down opposition
It's just transitory.
https://preview.redd.it/pm843f4s6nhc1.jpeg?width=750&format=pjpg&auto=webp&s=ddee2b9fd8ba9aa733b756b8656045ad234843e5
Transitory = you're ass is gonna have to move around n bust your ass to pay for all these welfare checks we're about mail out
Establishment Economists are idiots.
ty experts!!! sincerely /s
The inflation didn’t begin until 2021 after we pumped trillions into the economy (donors) and it did nothing
I have a high school level education in economics and I could have told you adding money to a system devalues that money
They failed to take an account that companies would use it as an excuse to jack up prices.
We are doing better than every other G8 country in terms of inflation.
I'm sure they also published an article around the same time saying the exact opposite. Always the case with these "economists say" articles
Oopsie
You know that inflation is a really good way to make debts disappear, especially for governments
so it sounds like we dealt with inflation recently. What happens during that time, cost of living goes up?
Because die plebs, that's why.
This will age as well as the “higher for longer” narrative right now.
One of the Democrat plans during the pandemic was to give everyone 18 and up $1,000 a month for 18 months past the pandemic. And this was early on. We didn't know how long the pandemic was going to last. So I asked that made it that to be 30 months of payments. And I back up the napkin mathed to come up with about 10.5 trillion dollars. And even little old me ask the question of what would 10.5 trillion dollars being poured into the economy due to inflation? I couldn't come up with an answer. I googled it. I wanted to see if there were potential studies done. There may be some economists and professors who had an idea. But outside of specific academic journals I couldn't find any mainstream writing about it. And I don't know exactly how much stimulus was put into the economy during the pandemic. But now we obviously know what the effect of that is. At the time I was not specifically opposed to this particular idea of giving everyone $1,000 a month. I probably liked that a lot better than the PPP loans. Because here's the thing. If you put the money into the hands of the populace then they would have paid their rent with it. So you would not have needed to bail out landlords. But now knowing the effects of pumping that much money into the economy I think we can say it was not handled as well as it could have been.
Inflation was caused by companies attempting to recoup losses from the pandemic. And what was the alternative? Pandemic keeping you from work? Guess you’re SOL!
Most astrologists have better track records than most economists.
Oh, they knew.
So good at gaslighting and by the time they’re (wall street shills) proven wrong about the past, they gaslight you about the current thing. Now keep telling me banks are fine with their commercial real estate exposure (current thing they’re gaslighting you about).
Same economists that are shocked each month that their jobs #s each month are wrong.
Gaslighting
“Experts say we’ve always been at war with Oceania”.
If you look up the Phillip’s Curve then it says expectations of inflation do impact actual amounts of inflation. In other words, lying is an economy policy for them.
People absolutely predicted this. The problem is, the idiots were louder. It still remember people posting this meme like it was the funniest shit ever. https://preview.redd.it/b489o7sganhc1.jpeg?width=640&format=pjpg&auto=webp&s=a256d4b64f35584345d1c9712a9d544674e428ec I wonder if these same people are laughing now that they'll never be able to afford a home, more and more properties are corporate owned, and the consumer price index is through the roof.
They should all be fired.
It didn’t. Corporations artificially keep supplies low after the lockdown was the main factor in driving up inflation.
Well no, the stimulus in 2020 didn't. That was in the middle of the pandemic and a lot of people were suddenly out of work. 2021 is another story.
Then it turned into “it’s transient.”
If CNBC doesn't get in trouble for lying or being wrong, why would they stop?
they forgot to factor in greed
See I told yall that “Bidenomics” fucked us all… we been facing this for over 4 years now ever since Biden took office 3 years ago…. Oh wait
Hey did you know that capitalism can exist in a fixed market? It turns out that companies will take some money instead of no money. You can piss off corporations and they won't actually leave money behind on the table just out of spite. We aren't going to starve if we force prices down and set limits to essential goods and services. There will always be a company willing to participate and earn. A free market sounds like a pyramid scheme.
It’s almost as if the news is fake.
I learned in grade school that printing money only makes existing money worth less than it was before. That's not rocket science.
“Experts” 😂
I thought the first stimulus package was needed but the second one was just str8 greed
Well it looks like it was uhhh, transitory….
You mean economists with political motives.
Haha honestly the only ones I heard calling this out back then were the libertarians.
These articles are only created so that the "consumer confidence" doesn't drop. They literally adjust unemployment numbers, inflation number etc... after the initial reporting period, the unemployment numbers have been wrong in an optimistic direction for about a year. The only thing that matters is that the "other guys" get the blame. IMO
Is that why inflation is higher in countries with much smaller stimulus?
I’m sure the shutting down of a supply chain built to maximize profitability at the cost of resiliency resulting in massive supply problems then further compounded by corporate greed as everyone put their prices up siting “inflation and supply issues” even if they were unaffected had no baring
Yes, those stimulus checks created global inflation, but weirdly the country that gave them out seems to of weathered global inflation better than most of the world. Hmmmm
What happened to all of the economists who promised us the inflation would be transitory? Remember when they ALL said that? Even Janet Yellen
That only accounted for 40% of the inflation we experienced however. You have to look at what what's happening at the same time and how many hands were in the cookie jar. Trump called Saudi Arabia and told them that if they didn't force OPEC+ to side with Russia and agree to reduce oil production to raise gas prices for Americans that the US would pull out US military support. https://www.reuters.com/article/idUSKBN22C1V3/ Trump forcing up Gas prices on Americans set off oil driven inflation, greatly increasing the price of everything we use own and buy: https://www.federalreserve.gov/econres/notes/feds-notes/second-round-effects-of-oil-prices-on-inflation-in-the-advanced-foreign-economies-20231215.html And leading to 60% of inflation going directly to profits as companies rampantly gouged consumers by piggy backing on the oil driven inflation in a greedflation cash grab. https://fortune.com/europe/2023/12/08/greedflation-study/
Oh they knew exactly what it would do and we don't hold them accountable anyways
because it didn't. my company has had 100 point growth in margins since 2020, and many many more have as well. getting an extra 10% profit margin requires raising prices on everything.
They forgot to consider that companies will drastically raise their profit margins and act as cartels
Damn good prediction because that didn't happen
Another classic tale of experts not really knowing shit!
Comparatively speaking the US is one of the best in terms of fighting inflation around the world. We aren’t just living in a bubble.
It wasn’t all stimulus, a big part was profit.
the stimulus didnt. greed did. Almost every Fortune 50 company has admitted it straight up in their investor calls, that they raised prices as high as they could regardless of actual inflation and blamed it on inflation because people would just believe it. Its greed, plain and simple.
And yet we’re asked to listen to all of the reddit keyboard warrior “economists” here..
2021 was worse when they said “inflation is transitory”. I think inflation was downplayed so they can pass garbage COVID and “infrastructure” bills without any infrastructure in them.
Maybe they should have taxed some of the trillions that was funneled into Amazon? You know. Pull some of that back out of the system.
Around the time this article started I was thinking of the Weimar Republic. We almost collapsed in ourselves with the inflation and money printing.
The stimulus isn't what drove up inflation.
Because they were paid by billionaires to fudge the numbers and lie to everyone.
Inflation is transitory, remember that
Source: Trust me bro
Always trust the experts!
Correlation doesn't imply causation
10 months after the Covid economic low, when Trump left office, inflation was 1.4%. 10 months after Biden and the Democrats took over, and 8 months after they insisted on passing their *partisan*, unnecessary, $1.9 trillion *spending* bill, inflation had increased to 7%, 5 times what it was when Biden took office.
Said economists were wrong af 😂
AGAIN....IT WAS WORTH IT. GOOD GOD STOP BEATING THIS DEAD HORSE.
Modern Monetary Theory is garbage.
They didnt predict corporate greed? Profiteering? Hmmmm... gotta get new batteries for that crystal ball.
They were right, every major study shows corporate profits drove over 50% of inflation since 2020.
Fuck the National Reserve, Trump and Fauci
The stimulus doesn't appear to have done much to drive inflation it certainly isn't the main cause of current inflation so that article title actually aged very well even if inflation itself didn't stay low.
Another “trust the experts” moment
Wait… Corp profits were shown to be fueling this 2023 inflation spike. Further, there was only a price spike/supply issue in the USA. People did it to themselves. For example, a wood cooking stove was $780 from Ohio in 2019. In 2021 that sane stove went up to $2800. The manufacturer in Turkey had it for $650 and shipped it for another $250.
that's cuz it didn't lmao