>Thinktank report says ‘resounding evidence’ shows companies continue to keep prices high even as their inflationary costs drop https://www.theguardian.com/business/2024/jan/19/us-inflation-caused-by-corporate-profits A new report claims “resounding evidence” shows that high corporate profits are a main driver of ongoing inflation, and companies continue to keep prices high even as their inflationary costs drop.
The report, compiled by the progressive Groundwork Collaborative thinktank, found corporate profits accounted for about 53% of inflation during last year’s second and third quarters. Profits drove just 11% of price growth in the 40 years prior to the pandemic, according to the report.
Prices for consumers rose by 3.4% over the past year, but input costs for producers increased by just 1%, according to the authors’ calculations, which were based on data from the Bureau of Economic Analysis and National Income and Products Accounts.
“Costs have come down substantially, and while corporations were quick to pass on their increased costs to consumers, they are surprisingly less quick to pass on their savings to consumers,” Liz Pancotti, a Groundwork strategic adviser and paper co-author, said.
Since pandemic inflation spiked in 2021, a high-stakes debate has played out about its sources. Many progressive economists pointed to corporate profits – or “greedflation” – and supply chain issues as a driver of high prices, while their more conservative counterparts singled out government stimulus cash and high wages.
The report’s authors scoured corporate earnings calls and found executives bragging to shareholders about keeping prices high and widening profit margins as input costs come down.
The findings come as the Federal Reserve has hiked interest rates to their highest point in 20 years. The report casts serious doubt on the need for further interest rate hikes, and instead calls for stronger policies to rein in “corporate profiteering”.
Anonymous
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Prices rose in 2021 as labor costs jumped and supply chain shocks from the pandemic and the Ukraine war snarled shipping traffic and left energy supplies in question. But those issues have in many cases been fully sorted out or are easing, and the labor market has stabilized. Many commodities and services producers’ prices have actually decreased, the report notes. Nearly 60% of the drop in key goods and services’ inputs was driven by large declines in energy costs, such as jet fuel and diesel fuel, while transportation and warehousing costs have fallen by nearly 4% since June 2022 peaks. Still, prices remain high. Consumers are still paying about 25% more for groceries, the report notes as an example. Corporations maintain high prices by exploiting cost shocks caused by events such as the Ukraine war and coordinating price hikes, said Isabella Weber, a University of Massachusetts Amherst economist who was not part of the paper. The shocks create an environment in which it is safe for firms to increase prices as they expect their competitors to do the same, said Weber. “This is a form of implicit collusion,” she said. “Firms do not even need to talk to one another to know that a cost shock is a great time to raise prices. But when costs fall, price-setting firms do not have any incentive to decrease prices.” If no firms launch a price war, Weber added, then companies “hold the line” on prices and widen margins. She pointed to food processors as an example. The paper zooms in on the diaper industry, of which Procter & Gamble and Kimberly-Clark control 70% of the domestic market. Diaper prices have increased by more than 30% since 2019 from, on average, $16.50 to nearly $22. The rise was partly driven by an increase in commodities like wood pulp, a major component of diapers. Wholesale wood pulp prices soared by 87% between January 2021 and January 2023, but last year prices dropped by 25%.
Anonymous
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Still, diaper prices have not come down with lower costs, the authors say. Groundwork examined earnings calls and found executives at both companies boasting of widening profit margins as input costs decreased. A drop in inputs accounted for about one-third of Kimberly Clark’s profits, company executives said. P&G executives said in their July earnings call they expect $800m in windfall profits because of declining input costs, suggesting they won’t bring down prices. Meanwhile, workers aren’t faring as well – corporate profits as a share of national income are up by about 29%, and workers’ share of corporate earnings is still down from pre-pandemic levels. The Biden administration has taken steps to strengthen supply chains, Pancotti noted, and Joe Biden recently called on corporations to stop “gouging” consumers as input costs fall. But Pancotti and Weber called for stronger action, pointing to other nations with forms of price control in place. In France, the government intervenes in price negotiations among retailers and producers. Earlier this month, with the government’s support, the supermarket chain Carrefour banned some PepsiCo products from its shelves because of “unacceptable price increases”. Absent strong government intervention in pricing, the 2025 expiration of the Trump corporate tax cuts presents an opportunity to rein in corporations via the tax code, Pancotti said. “We’ve decided as a country that we like to have very large, powerful corporations and we are OK with them being very profitable,” she said. “We need to take a really hard look at how our tax code incentivizes corporate profiteering and ask: ‘Do we as a country want to do something about that?’”
Elon Musk leaks anally(Wegovy)
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>>1259080 say, ANIME ANNIE, did you know that a millionaire is just another asshole stuffed with $?
The bigger the wad of $, the bigger the asshole has to be to fit it up there.
Anonymous
Yeah companies just started getting greedy all of a sudden. They were so much more selfless until the COVID stimulus.
Anonymous
>>1259089 They were always greedy, they just used the Trump Virus pandemic to price gouge.
Anonymous
>>1259092 this is the line fed to people who don't actually understand what inflation is or what causes it
Anonymous
>>1259094 >t. corporate shill trying to deflect from the fact it was corporate price gouging and not inflation that kept prices up. Anonymous
>>1259097 then why hasn't the fed lowered interest rates yet?
Anonymous
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>>1259089 No. People just expected the prices to go up so they just raised the prices even higher because Trumptards would buy the explaination anyways
Anonymous
>>1259099 >Why would the Fed, run by a Trump lackey, work for the best interest of corporations and not the people? You tell me.
Anonymous
>>1259101 Higher interest rates benefit lenders, not corporations.
Anonymous
>>1259092 >Trump Virus pandemic Come on now, covid was released to not only remove Boomers and their Social Security costs but to fuck over Trump, just like the "mostly peaceful" riots were instigated by the Powers That Be to further undermine him to prevent him from getting anything done.
Trump is an outsider nationalist who managed to accidentally stumble into the White House because the Elites refused to recognize the anger of the Public and didn't get the system rigged in time to screw him over (which they did in 2020).
Anonymous
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NNNNOOOOO MY NARRATIVE NOW I HAVE TO ACTUALLY CONSIDER VOTING FOR BIDEN IN GOOD FAITH
Anonymous
>>1259102 >Lenders So the banksters, aka corporations
Anonymous
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>>1259103 >Everything bends over backwards to worship Trump Anonymous
>>1259089 "Inflation" has expanded at a more rapid rate than wages since the 70s but sure it's the government's fault for throwing people a few grand
Anonymous
>>1259117 >but sure it's the government's fault for throwing people a few grand It... it literally is their fault for this exact reason.
The few grand people got paid out was only a portion of what the government was actually spending per person during Covid, and 40% of all the money in circulation in the US was printed since Covid started.
It literally is the government's fault. You people are economically illiterate.
Anonymous
>>1259107 >being this stupid Anonymous
>>1259119 >He thinks the banks aren't a corporation Your accusation is a confession.
Anonymous
>>1259122 >words have meaning Bankers and corporations are distinct parties with very different aims in the market, cope
Anonymous
write the number 35 trillion on paper... go ahead. Now look at the history of how many dollars get printed into circulation and when... Put your thinking cap on... And wait ..
Anonymous
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it surprises nobody so they ignore it and make fun of me for bringing it up.
Anonymous
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>>1259123 >mum semantics They're all corporations and need to be reigned in.
Anonymous
>>1259092 Braindead npc zombie spotted
Anonymous
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>>1259136 It's amazing how the corrupt billionaire has you to snap to his defense whenever someone brings up something bad he did
Anonymous
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>>1259128 Why not just spell out your point clearly and legibly? We get it, you think too much money has been printed.
Anonymous
>>1259080 >The report, compiled by the progressive Groundwork Collaborative thinktank Invalid study. Ignored immediately.
Thanks for the shit thread, faggot.
Anonymous
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>>1259118 This is misleading as fuck considering the US mint prints about $500 million in currency a day, or $180 billion per year in an average non-pandemic year. That's just to replace the old money which gets destroyed by time/age/accidents.
Anonymous
>>1259140 >ignored immediately What a coincidence, so is your opinion.
Anonymous
>>1259080 >Thinktank report says Oh yay more propaganda straight from the democrat think tanks.
Anonymous
>>1259148 As opposed to the republican think tanks who say tax cuts pay for themselves and wealth trickles down to the poor? No thanks.
Anonymous
>>1259107 So why doesn't biden ask the fed to lower interest rates? Sounds like biden is complicit in your conspiracy theory.
Anonymous
>>1259154 Because the fed is an independent entity that does not have to operate at or honor a presidents request. Congress set it up that way to limit executive power.
Anonymous
>>1259149 >Thief complains about stuff. No one cares.
Anonymous
>>1259158 Biden nominated Powell for a second term. If you're suggesting the fed is artificially keeping interest rates propped up to enrich bankers, you're implicating Biden in the process.
Anonymous
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US Debt -35,000,000,000,000
Anonymous
>>1259176 You're the one who just suggested that.
Anonymous
>>1259173 >taxes are theft I remember when I was a young naive lolbertarian too
Anonymous
>>1259148 I'm sorry but after spamming the board for the last 10 days with
Heritage.org anti-immigrant claptrap you have absolutely no right to complain.
Anonymous
>>1259179 I'm not even libertarian. I just want my fucking money, shitface.
Anonymous
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>>1259180 >anti-immigrant claptrap Even New York agrees illegals are a burden. Die in a fire, please.
Anonymous
Anonymous
>>1259176 No, Biden can't be implicated because he has no power over the fed other than the nomination process which is then approved or not by congress. Learn how government works, nimrod. Cheap Biden bait isn't worth a sniff.
Anonymous
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>>1259181 So you don't want a military to protect the country which enables you to make money? Income tax is a constitutiona, so pay proudly as it's your civic duty.
Anonymous
>>1259200 why would biden re-nominate someone who's artificially propping up interest rates if he's not complicit? in any case your conspiracy theory is dumb. inflation spiked before the fed raised interest rates.
Anonymous
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>>1259202 I can't economate that's why.
Anonymous
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>>1259178 You're the one pretending to be retarded
Anonymous
Once again, nothing the threat of nationalization wouldn't fix. if the threat doesn't work, make good on it and nationalize them. This is a national security threat after all.
Anonymous
Anonymous
>>1259143 Well, I decided to take your challenge as I usually do.
So I opened the link the in OP, followed the link to the activist website. Then found the document.
It's a 6 page document that just claims stuff as fact, then gives Joe Biden sloppy toppy at the end for good measure.
It's just more replication crisis Democrat misinformation. Yay!
Anonymous
>>1259244 So you didn't read it and are a Trump shill.
Good to know.
Anonymous
>>1259245 Fuck off, nut sack.
Anonymous
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>>1259246 No way jack wax.
Anonymous
>>1259246 haha. you're an angry little b
Anonymous
>>1259244 Good post
>>1259244 >gives Joe Biden sloppy toppy at the end for good measure Pretty standard for American liberals. I'd more suspicious if they didn't do this
Anonymous
>>1259248 Quit being a faggot on the Internet.
Anonymous
Anonymous
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>>1259252 Fuck off you crazy tranny.
Anonymous
Anonymous
Anonymous
Really it was consumers' fault for having income. If we were all poor beggars buying only what we need to survive, inflation would have been significantly less severe. Don't worry though, corporations will wring every last drop of blood out of that stone until the middle class no longer exists. Reminder we need to tax the millionaires and billionaires and bust all our mega corps down 20 sizes. Literally the only incentive companies don't have to wring every dime they can out of consumers is competition and that shit's a fairy tale in a lot of areas and industries. Eat the rich.
Anonymous
Anonymous
>>1259342 >Eat the rich I'd rather you just got a real job, you loser
Anonymous
>>1259345 I'm fine with the idea of eat the rich, but the execution has never done anything but make the rich richer.
It's like these rich people are more intelligent than the eat the rich plebs.
I wonder if there's a reason the rich are rich and the eat the richer-ers would be homeless if they weren't leaching off their parents.
Anonymous
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>>1259346 >but the execution has never done anything but make the rich richer I dunno, the French Revolution didn't seem to work out that great for them now that you bring up execution.
Really the only time the rich seem to get richer is when a bunch of dumbfucks come in right after reforms and then reverse them all and then give the rich a bunch of benefits beyond what they had before because of political partisanship and then blame the reforms that weren't even left in place for the rich getting richer. Neoliberalism is a cult the rich have put to excellent use.
Anonymous
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>>1259346 >I wonder if there's a reason the rich are rich There is. Fundamentally power and wealth allow for the accumulation of power and wealth. Wealthy corporations can afford to undercut, crush, or by out their competition. The incompetent children of rich parents still end up rich purely off of the investments of their parents. They literally couldn't spend money fast enough to lose wealth. You basically need the wealthy and powerful to actively fuck up for a long time and not have the government go out of their way to erase their mistakes for someone to fall from grace.
Meanwhile debt likewise leads to the accumulation of debt. The economy naturally stratifies itself and only one side is in an economic position to do anything about it and they have no incentives to do so beyond basic morals they probably weren't raised with in the first damn place.
Anonymous
>>1259101 who's Trump's lackey? didn't Biden fire all of Trump's people the minute he took office and overturned more than half of Trump's policies? this inflation is really the incompetence and corruption of local state governments and the shitty management of federal resources. The Bank of America is responsible for 70% of this.
Anonymous
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>>1259345 Nah, go after the people that keep that anon poor.
Anonymous
>>1259354 The FBI is still run by a Trump loyalist, and they even tried to run a cover up for Trump after his failed coup claiming it wasn't coordinated.
The successful sedition proseuctions say otherwise.
Anonymous
>>1259388 >Trump fired the FBI head who would have prevented Jan 6 and replaced him with a crony! Every time with you delusional retards
Anonymous
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Inflation is a hidden tax on the poor and middle class. Government benefit from accessing funds from the federal reserve first. By the time it circulates into the economy to the masses it deprecates.
Anonymous
>>1259390 >Trump shill trying to conveniently ignoring that the FBI ignored the warnings that an attack was imminent. Anonymous
>>1259424 And Pelosi refused to give Trump the security needed to prevent it from happening.
Nobody fucking cares anymore. At this point there's three groups in this country: People that believe you no matter what you faggots say. People that will never believe you no matter what you faggots say. And people who will never care enough to pay attention to what you're saying.
Anonymous
>>1259426 >Trusting the word of Trump, the terrorist who masterminded the Coup. Holy desperate cope batman.
Trump never asked for it because he was intentionally weakening the capitol security, and his loyalists in the pentagon intentionally ignored pleads for help in order to let the coup go forward.
Anonymous
>>1259240 The government can't run the post office, or trains, very well... but you want them to nationalize corporations lmao
Anonymous
>>1259428 >all this made up fanfiction I believe Trump before I believe a Democrat. And that's while knowing Trump is a liar.
>That's because you worship him!!!! MAGA! [NEGATIVE ASSOCIATION]!!!! Hahahahahahahahaha. You people are a treat.
Anonymous
>>1259431 >I trust the guy who staged the coup And this is why no one takes you seriously here.
Anonymous
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>>1259430 The government has electrolytes, it's what progressives crave.
Anonymous
>>1259428 Trump asked Pelosi to bring in the troops to protect Congress before Jan 6. Pelosi told him to fuck off and intentionally weakened the security.
This is all proven (by the Jan 6 commision) to be a fact.
You and Pelosi are the real Jan6 terrorists.
Anonymous
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>>1259435 Yea that’s not what that report says at all. Nice Fox News spin,
Anonymous
>>1259432 >The guy who staged the coup Says you. And I don't trust you. :)
Anonymous
>>1259435 >>1259439 >Republican shills blaming the victims for their cruelty Typical
Anonymous
>>1259442 Scream and yell "shill" all you want. It won't make me believe anything you say.
Anonymous
>>1259447 But that's what you are, so it invalidates your lies.
Anonymous
>>1259452 Nope. I'm just John Q Public. Tax payer and registered voter.
And I don't believe a word you say.
Anonymous
Anonymous
>>1259459 Oh now I'm a Russian? Cute. Got any more copes?
Anonymous
>>1259456 Let's see your state ID and Social Security number then. If you're actually American.
Anonymous
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>>1259460 you mother is ashamed of your life choices, and your father smells of elderberries
Anonymous
>>1259461 Hahaha. No. Haha. :)
Anonymous
>>1259465 Vatnik confirmed
Anonymous
>>1259466 Crying democrat homosexual confirmed.
Anonymous
>>1259468 Are you outraged?
Anonymous
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>>1259469 Nah. No need to apologize.
Anonymous
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>>1259080 I work for a major corporation and they've insisted we increase profit margins by an additional 7% despite our logjams and material costs dropping. This comes purely from the bean counters and none of the sales people.
Anonymous
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Yeah most of the sane people realised inflation was a multifaceted issue between covid, shipping and supply woes, Russian war, a completely natural recession, and corporate greed jumping at a golden opportunity. Corporations coming out of all that with record profits and CEO raises while telling us "trying times" the entire way was maddening.
Anonymous
>>1259426 >And Pelosi refused to give Trump the security needed to prevent it from happening Not true. Trump never made a request and Pelosi never denied any request.
https://www.nytimes.com/2024/01/19/us/politics/trump-haley-pelosi-jan-6.html Anonymous
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>>1259547 Uh oh, russia sisters, what is our response?
Anonymous
Anonymous
>>1259567 >WPMI – Mobile News is owned by Sinclair Broadcast Group >Sinclair https://www.youtube.com/watch?v=_fHfgU8oMSo Anonymous
>>1259568 Which group of investors owns all the other media and how much do you love the billionaires that provide your news?
Anonymous
>>1259569 The news should be trust busted so the billionaires can't own everything. Doesn't change the fact you cited right wing propaganda that tried to launder its propaganda through a local affiliate.
Anonymous
>>1259571 Nah. You're just mad disinfo got busted to shit.
Anonymous
>>1259571 >The news should be trust busted so the billionaires can't own everything. How will Democrat plebs receive their marching orders then?
Anonymous
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>>1259574 >>1259573 Nah, why should we trust some rando capitol police officer who might not exist from a Trump Republican outlet?
Anonymous
>>1259574 Through our conscience and morals like usual
Anonymous
>>1259580 Sure, but, "How will they be able to use your conscience and morals for their gain?" is the question.
I don't think billionaires will just let the government they pay big money to legislate against them just because you think their mechanism of controlling Demoplebs should be dismantled.
Cool story though.
Anonymous
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>>1259592 Don't ask questions you don't like the answer to
Anonymous
>>1259547 >nytimes Oh look. More lies.
Anonymous
>>1259592 You do realize ALEC exists, which is what you're accusing the other side of?
Anonymous
>>1259609 I also realize the UN/WEF exists which is what you are.
Anonymous
>>1259609 >ALEC provides a forum for state legislators and private sector members to collaborate on model bills—draft legislation that members may customize and introduce for debate in their own state legislatures. >Some of these bills dominate legislative agendas in states such as Wisconsin, Colorado, Michigan, New Hampshire, and Maine. It seems you're actually that too. Wow.
Anonymous
>>1259606 Wrong board moron
Anonymous
>>1259642 Oh right. This is /news/ - Everything Democrats Say is True.
Anonymous
>>1259646 Yes. Reality has a left wing bias. If you want fiction instead of news, try /lit/.
Anonymous
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>>1259614 >>1259612 I accept your concession
Anonymous
>>1259684 Lol it only does when you deny any facts that go against your ideology.
Anonymous
>>1259703 But enough about Republicans
Anonymous
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>>1259606 Just because they're caught having a conservative bias doesn't mean they lie all the time. Just most. And not this time.
Anonymous
>>1259705 Only Democrats do that.
Anonymous
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>>1259743 t. NYpost reader
Anonymous
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>>1259080 Who pays these people to flood the news board with this bullshit?? EVERY THREAD is either shit talking trump or blowing biden. How bad do you need to control the narrative and spin shit that you play people to spam 4chan of all places.