91–100 of 324 posts
Their argument is basically that while normally a company raising prices would mean that some of their customers move to a competitor, in today's environment there is an implicit agreement that every company will keep prices high. So are they saying that the free market is basically not a thing anymore because of covid, and no company wants to get an edge over its competitors by undercutting on price despite having r…
Earlier quoted context omitted.
I can't argue that government spending isn't a problem. It really is. In particular it's where the money is going, how it's being accounted for, and how much benefit the average American sees from that which is way out of whack. The pandemic had the government printing a ton of money and handing it out to some very rich people, but does giving more money to a person who already had enough money to afford whatever the…
It does. Think for example, if you had worked hard 30 years to acquire a $250,000 house, and the government just gave everyone $500k overnight. Would you think it's fair they could pay $250k for your house for not having worked for 30 years, while you had to? Probably not. Instead you'd likely raise the selling price of your house to protect the value of your hard work. Same goes for companies that produce milk. Obvi…
Their argument is basically that while normally a company raising prices would mean that some of their customers move to a competitor, in today's environment there is an implicit agreement that every company will keep prices high. So are they saying that the free market is basically not a thing anymore because of covid, and no company wants to get an edge over its competitors by undercutting on price despite having r…
oh come on! Corp profits dont help, but they're about as consequential as wage increases. Its sticky because of the money printing done in the past, and still happening. They printed a TON of money, its devalued our $$$'s. This is the direct consequence.
Unfortunately some economic actors can protect themselves, even profit from inflation much easier than others. Inflation usually hits the poor the hardest. Given the same amount of real resources this is because other groups of society can take advantage of inflation to increase their share of the pie.
Their argument is basically that while normally a company raising prices would mean that some of their customers move to a competitor, in today's environment there is an implicit agreement that every company will keep prices high. So are they saying that the free market is basically not a thing anymore because of covid, and no company wants to get an edge over its competitors by undercutting on price despite having r…
The free market is supposed to work through scale and optimization; scale is still a relevant force, but mostly serves market consolidation. Optimization is not something that can be frequently innovated on. So everyone has pretty much the same cost basis in long established industries like food.
There is simply no incentive for these corporations to start a price war; they all know starting one will only result in a very brief competitive advantage until everyone returns to baseline profits.
Funnily enough, a lot of recent reductions in cost basis in "innovative" startups is not done through optimization; it is done through VC speculating on their competitor finding a more permanent place in a (supposedly) new market after consolidation and prices adjust back to reality. An example I can come up with of this is food delivery services in Germany: For a while, several providers were undercutting each other in price and service level. Now all of Germany is dominated by Takeaway, and their service level is slightly above "we don't care". We'll see the same in instant grocery delivery in a year or so. Getir seems to be winning that one. Until then, enjoy ridiculously cheap instant grocery delivery, powered by VC funding and extra dirty worker exploitation (only one of those will continue to exist).
It's a likely theory. But economics teaches us when a player overcharges, others will step in to undercut and take all the market share. So, we're at a point where we need to admit that mantra isn't true in the modern age, or admit that we've done a terrible job at preventing effective monopolies/duopolies from forming.
> So, we're at a point where we need to admit that mantra isn't true in the modern age, or admit that we've done a terrible job at preventing effective monopolies/duopolies from forming. It's objectively obvious that the latter is true, but why? One of the reasons is regulatory capture. But another is that people have stopped believing the former. Suppose there is a market with an existing duopoly that charges high p…
There is also the problem that if the incumbents move to undercut, then any onlooker would assume that even if they bought the infrastructure they would also face the same undercutting; and would therefore have to remain solvent longer than an incumbant to make a return.
I think this is why there is so much focus on tech or disruption; you need some way to compete against the scale efficiency of the incumbant.
Their argument is basically that while normally a company raising prices would mean that some of their customers move to a competitor, in today's environment there is an implicit agreement that every company will keep prices high. So are they saying that the free market is basically not a thing anymore because of covid, and no company wants to get an edge over its competitors by undercutting on price despite having r…
* Rent (they're all high; and can't afford to buy anywhere near where I work)
* Food (prices are pretty much the same everywhere)
* Internet (Cable's the only modern-speed option where I currently rent)
* Energy / Gas - either utilities or again, the same everywhere
I think most everyone else is in the same boat. I can scale down some of these a little bit, but they're all fairly __inelastic__. I can't stop eating. I need all of these for life and work.
Want to tame inflation? Tax the hell out of profits above X%!!! Someone's making money on this.
It's a likely theory. But economics teaches us when a player overcharges, others will step in to undercut and take all the market share. So, we're at a point where we need to admit that mantra isn't true in the modern age, or admit that we've done a terrible job at preventing effective monopolies/duopolies from forming.
Why not both? The modern dismantling of antitrust regulation and enforcement is a significant driver of both. It's gotten way worse now than ever, to the point where private equity firms like Vanguard and Blackrock can be the biggest shareholders in direct duopoly competitors (KO and PEP are an example), or where investors and producers are permitted to fully horizontally and vertically integrate (AMZN is an example)…
Amazon is the best middle man that customers could ever want. They clip the ticket an almost imperceptible amount.
The stores you'd probably promote, small mom and pop stores, generally have 50%+ margins.
Who exactly is gouging customers? It's not Amazon retail.
https://www.virginmedia.com/mobile/annual-rpi-price-increase
https://www.ispreview.co.uk/index.php/2023/01/virgin-mobile-...
Then again so do wages, while inflation was small and consistent it oiled that machine to keep from there being a big drop in purchasing power.
But when inflation is in the double digits that all breaks down.
It's also a clear reminder of how so much European utopian aspects (free healthcare, education etc) is run on pure goodwill. Just look at the strike action in the UK with Nurses having seen 15% pay cut (being forced to accept a 5% pay "rise" after much negotiation) and doctors have seen a 21-26% paycut.
Education continues to collapse with tuition fees rising, universities opting for cheap to run, low value courses to pull in money and teachers striking continuously as work conditions go from awful to unbearable.