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Corporate profits account for almost half the increase in Europe’s inflation

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Re: Corporate profits account for almost half the increase in Europe’s inflation

#371

Post by mypastself »

bedobi wrote: post #359
mypastself wrote: post #61

Earlier quoted context omitted.

The same way supporters of the greedflation hypothesis defend their position on corporate greed: by claiming it increased substantially in recent years. Except the money printing hypothesis champions have more convincing data.

> the money printing hypothesis champions have more convincing data they really don't though, that's the point. they've been screaming that all the "money printing" is going to cause hyperinflation any day now for decades. eventually yeah we got some inflation, even a broken clock is right twice a day. their ideas have zero explanatory power. (if they did, how come we didn't get hYpErInFlaTioN decades ago, and STILL…

Money printing increased significantly in the past few years, as did inflation. Taking the most extreme version of the argument and using inconsistent capitalization when quoting it doesn’t stop inflation from being a monetary phenomenon.

Re: Corporate profits account for almost half the increase in Europe’s inflation

#372

Post by pmontra »

gsatic wrote: post #363
pmontra wrote: post #83

Earlier quoted context omitted.

I'm not sure about that. It's more likely that each of us has a lot of different stuff to care about, more and more as we transition to adulthood, families, etc, and it's not economical (as in time+energy) to care too much about prices and wages as long as we can get what we care about. When the money run short, it changes.

It doesn't change. Have you checked how much credit card debt exists? How and why did that happen? People are easy to game.

If they still have credit they are not short on money by definition. When (where) people have no credit, they spend only what they must or less than that.

Re: Corporate profits account for almost half the increase in Europe’s inflation

#374

Post by csomar »

ricardobeat wrote: post #320
ChuckNorris89 wrote: post #313

Earlier quoted context omitted.

>We have a labor shortage instead. Not from the Netherlands, but the labor shortage I see Austria is mostly companies still trying to pay 2020 wages rather than a lack of people motivated toi switch jobs/immigrate. Labor shortage here is just propaganda for "we can't find people willing to work at the salaries we want to pay". In similar fashion I have a constant Ferrari shortage because I can't seem to find these ca…

The minimum wage in the Netherlands rose over 20% since 2020, while in Austria it apparently hasn't moved. Though I have a hard time believing the "people don't want to work" theme, when the alternative is having no income at all?

> when the alternative is having no income at all?

There is a breaking point where you'd rather not work than work even if there are no government subsidies (ie: unemployment stipend). The math is, it costs you money to eat, go to the job, a roof, etc... If the job doesn't pay for these necessities, you just stop working.

Re: Corporate profits account for almost half the increase in Europe’s inflation

#375

Post by csomar »

nostromo wrote: post #52

Inflation is caused by monetary policy. Did profits increase? Potentially, yes. But they couldn't have increased without the enabling condition of massive money printing. Companies were trying to maximize profits before 2020. That hasn't changed. What changed was the monetary policy.

It's impossible for the IMF to admit that, or the World Bank. I think most people in the Western world confuse their freedom of speech to mean that there is enough coverage of what's happening inside their institutions.

Have a look at this: https://www.economist.com/finance-and-economics/2020/02/13/t...

Re: Corporate profits account for almost half the increase in Europe’s inflation

#376

Post by ImPostingOnHN »

cortesoft wrote: post #272
jjoonathan wrote: post #111

Earlier quoted context omitted.

The profit motive & margins fund lobbyists and political campaigns to change policies that absolutely drive these market changes. We could choose to have anti-trust measures with teeth. We could choose to tax assets. We could have progressive corporate taxes to encourage smaller company sizes and more public transparency. There are so many things we could choose, but the ones that we do choose are the ones that share…

These things may help reduce corporate profits, but it wouldn't change inflation.

reducing corporate profits would reduce inflation, since corporate profits account for almost half of inflation, according to the article

Re: Corporate profits account for almost half the increase in Europe’s inflation

#377

Post by qeternity »

truckerbill wrote: post #141
nostromo wrote: post #52

Inflation is caused by monetary policy. Did profits increase? Potentially, yes. But they couldn't have increased without the enabling condition of massive money printing. Companies were trying to maximize profits before 2020. That hasn't changed. What changed was the monetary policy.

Yes. But importantly its not the printing of money that was the problem either. If you think about the path money takes especially the furlough: government -> consumer -> big capital (Petro/chemicals, Pharmaceuticals, Food Conglomerates, Landlords, Tech...). And that's where it stays. How do you get it back? Well aimed taxes. Otherwise big capital buys all the assets as in investment with their new found pile.

> How do you get it back?

What in the world? I get that “Big Capital” is an easy boogeyman but how do you think this works? If you print money, so you can exchange that for someone else’s goods, what entitles you to “get it back”??

Re: Corporate profits account for almost half the increase in Europe’s inflation

#378

Post by csomar »

ta8645 wrote: post #214

Call me a conspiracy nut, but there appears to be a coordinated effort to destroy faith in the system that gave us all the wealth we currently enjoy. I can only assume that this is being done in the service of replacing it with... something.

There is no coordinated effort by anyone to destroy the system. The system is destroying itself by itself. The Ottoman empire fell because it couldn't keep track of its expenses. If you print money once to fix a deficit you suddenly become complacent. Now, you do it again. It doesn't seem to have much effect and the people/markets got complacent with your behavior too.

You do it again and again. Now, it's part of your "process". Let's call it Quantitative Easing. Let's also take advantage of a pandemic to print as much as we can. There is a good "reason" for that.

At some point the music stops and the system collapses. There is no conspiracy there.

Re: Corporate profits account for almost half the increase in Europe’s inflation

#379

Post by qeternity »

cbg0 wrote: post #77
thermalsauce wrote: post #41

Earlier quoted context omitted.

Right, how does it make sense to blame the private sector for rapid inflation when it's the government and central banks that control the minting of currency? I get that corporations are evil and greedy, but inflation is not something corporations have influence over. If anything, we should be looking at banks, yet even banks count on the central bank to print them fresh bills.

> inflation is not something corporations have influence over Of course they do. Here's a simple example: if the price of energy goes up, the price of food and various goods goes up across the board.

The _cost_ to produce food goes up. Prices may or may not go up. Food producers are charging what people will pay, not what it costs them. Competition might be reduced when everyone’s input costs increase, but this principle still remains. If the market will bear higher food prices, and energy prices remain unchanged, then it’s simply the food producers that reap profits instead of energy companies.

Re: Corporate profits account for almost half the increase in Europe’s inflation

#380

Post by qeternity »

GFlaneur wrote: post #204
darksofa wrote: post #180

Milton Friedman - Only governments create inflation https://youtu.be/F94jGTWNWsA “Inflation is made in Washington because only Washington can create money. Any other attribution to other groups of inflation is wrong.”

In all advanced economies - majority of money is created by bank loans (including mortgages) rather than by the the central bank.

This has not been true for a very long time.
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