Without a doubt monetary policy has fueled inflation, but do not ignore the policies of allowing corporate mergers for the last 40 years. Lack of competition reduces price elasticity, and the end game of every monopoly is to raise prices. We are living in a world of global monopsonies, and my expectation is to contine to pay this monopoly tax for years.
Worse, is it’s never been easier to collude. It used to be you had to pay a big consulting firm big money for them to tell you “current market rates” for many goods and services. Now you can just subscribe to same SaaS everyone in your industry uses and have it tell you how much to charge. This tends to help break out of a prisoner’s dilemma.
This was something I never quite anticipated. I used the intenet when it was young to help do price discovery and find better deals. Never occurred to me the end game was for companies to do it even better for pricing. Even after seeing thrift store pricing adjust due to seeing online prices on ebay, it didn’t occur to me the scale it would happen elsewhere.
There are 20 different burger restaurants within 10 miles of me. Some are chains, some are local. Some use major beef suppliers, some use local organic ones. All of their prices have gone way up.
There is no collusion here and this has jack shit to do with mergers. If those were the causes, inflation would have been a crisis 10 years ago.
How many of these burger joints own the building they operate in?
This is a very shallow look at economic forces. And ignores some of the bigger squeezes happening. The number of landlords continues to decline as real estate is consolidated in fewer hands. And worse, the number of landlords that abdicate their roles to real estate management companies grows every year, and the percentage of properties in an area run by a given management company continues to grow as well. This creates a level of “collusion” that didn’t really exist 30 years ago.
Our current market abhors competition, and regulators and courts have increasingly sided with the bigger business.
Inflation was a huge problem 10 years ago. It’s why I stopped renting.
Rental prices and estate prices have been rising since at least 2010. So much longer than 10 years, but the prices have not risen commensurate to this with a multiplier like they did lately.
So, the inflation story is most certainly a lie. The businesses started to charge more because they had an excuse in (a minor) supply shock and fuel price rises. But it's just that, an excuse. Worst case pure inflation is about 10% while the increases are... a lot. Especially in some sectors.
The situation is "so bad" for some corporations they're instituting stock buybacks. :) So stockholders are getting rich.
You’re bending over backwards to make your narrative fit. These burger restaurants are a blend of major national chains and completely local ones. The local ones absolutely are not “instituting buybacks”.
This is not some corporate conspiracy. The fed’s comments on inflation have made it very clear there is a labor shortage in the services sector that is driving up costs there quickly.
Starting hourly rates at these restaurants are now $20/hr, up from $15 a couple of years ago, and that’s still not enough. Each one of them has hiring signs and is clearly short staffed.
The only collusion is the default one: profit at all costs.
Everyone raises prices to increase profits, increasing inflation, that increases prices further...
I don't understand why people are so happy to blame governments and treat companies, in which profit is their raison d'être, as if they're only "reacting to the government".
Of course both are to blame, but let's stop pretending companies are victims while record profits are seen everywhere (adjusted to inflation). Many (if not most) are clearly taking advantage of this exact sentiment against the government to pocket even more profit. It's not me, it's the inflation!
Rare for whom? At any point in time this is happening in many countries around the world.
I don't see how the frequency changes my assertion though. That's the regular boom/bust cycle from capitalism. There are many theories on why that happens but the fact is: they happen.
Worse, is it’s never been easier to collude. It used to be you had to pay a big consulting firm big money for them to tell you “current market rates” for many goods and services. Now you can just subscribe to same SaaS everyone in your industry uses and have it tell you how much to charge. This tends to help break out of a prisoner’s dilemma.
This was something I never quite anticipated. I used the intenet when it was young to help do price discovery and find better deals. Never occurred to me the end game was for companies to do it even better for pricing. Even after seeing thrift store pricing adjust due to seeing online prices on ebay, it didn’t occur to me the scale it would happen elsewhere.