Inflation fell to its lowest annual rate in more than two years during June, the product both of some deceleration in costs and easy comparisons against a time when price increases were running at a more than 40-year high.

    • DocMcStuffin@lemmy.world
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      1 year ago

      There’s a term for that: greedflation. When a company raises their prices to improve their margins then blames the increase on inflation.

    • SCB@lemmy.world
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      1 year ago

      Inflation generally begins with suppliers, so unless you consider truckers, farmers, miners, etc “corpos” your take is way off base.

      Today’s inflation is a direct result of the pandemic, exacerbated through savings/loose credit/“free” money as a result of not being able to spend during the pandemic. Demand didn’t disappear, it just got built up. Meanwhile, manufacturers, shippers, and receivers literally couldn’t get staff, and their costs rose. This carried all the way down the chain

      The common retort here is the “record profits” line, but like… Yeah. Demand built up for TWO YEARS. Everyone and their mom is hiring. Of course they’re seeing record profits.

      Gouging has nothing to do with it. Unless you’re talking about crude oil prices then yeah it’s a lot of gouging, lol. Monopoly on supply and all that. But again, those costs trickle out through the entire economy.

      • afraid_of_zombies@lemmy.world
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        1 year ago

        My salary didn’t increase enough to match inflation but the amount we charge our customers at my job did. Oh and my clients are all government or large manufacturing outfits. Not like malls or something.

        Nothing to see here, right?

        • SCB@lemmy.world
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          1 year ago

          If every person’s salary increased to match I flation we would enter a wage hike spiral where wages go up, inflation rises, wages go up, inflation rises, etc

          • afraid_of_zombies@lemmy.world
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            1 year ago

            You can’t fix anything, you should just accept that life is shit, and all the things that I said were bad ideas are great ideas for the super rich.

            -every time economists talk.

      • SeaJ@lemm.ee
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        1 year ago

        Gouging is roughly half of the reason for the hough inflation. Even industries that saw no shortages raised their prices because they saw they could because people expected higher prices. There have been a few econ papers written on the subject. Initially the additional profit margins were not looked at much because generally that is not the cause of inflation. But it can be. The last time it was a significant source of inflation was after WWII when people expected higher prices because factories had to completely switch what they were producing back to commercial good.

      • Earthwormjim91@lemmy.world
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        1 year ago

        Uh, yes to all 3.

        Only 9% of truckers are owner operators. 91% work for companies, the vast majority of which work for large companies like SWIFT, or major retailers like Walmart.

        The vast majority of miners work for large corporations too.

        A majority of farmland is owned by mid-large sized corps too.

        So truckers, farmers, and miners themselves might not be corpos, but they’re labor for a capitalist just like most everyone else. And those capitalist owners are looking to extract the maximum profit possible.

        • SCB@lemmy.world
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          1 year ago

          You don’t seem to understand that most trucking companies, by a VERY large margins, are not large fleets. I worked in that industry for a decade.

          Your hate of capitalism is nonsensical.

          • afraid_of_zombies@lemmy.world
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            1 year ago

            I don’t hate capitalism anymore than I hate natural gas. I would rather cook with it instead of inhaling it.

            It has its uses and limitations.

      • BraveSirZaphod@kbin.social
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        1 year ago

        Not to mention, “record profits” is exactly what you would expect in absolute numbers in an inflationary environment. If all of a company’s costs double, and they subsequently double all prices, then they’ll get “record profits”, despite nothing meaningful having changed.

        Individual workers are also making “record” amounts of income, but again, that number in isolation isn’t meaningful at all. I have significantly more dollars than a 1700s NYC landlord. I’d still much rather have his relative financial situation.

        • Johnvanjim@lemmy.world
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          1 year ago

          That’s not how net profit works. Net profit takes into account the cost of goods, if cost of goods, doubles, and gross profit doubles, net profit hasn’t changed at all. These companies are taking advantage of the fact that cost of goods (including shipping) have gone up to massively crank up prices, hence record net profits.

          Corporate profit margins hit a 70 year peak in 2022 despite plenty of supply turbulence in the highest inflation since the 1980s.

          • BraveSirZaphod@kbin.social
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            1 year ago

            Yes, it is.

            Expenses: $500
            Revenue: $1000
            Net profit: $500

            Now, say we’ve had runaway inflation, and the dollar is suddenly worth half as much.

            Expenses: $1000
            Revenue: $2000
            Net profit: $1000

            You might thing, “hey, that’s $500 more dollars!” Yes, but these dollars have half the value as they did in the previous scenario, so you have the same amount of actual value as before the inflation, even though the absolute number is higher and thus you’ve broken records. Profit margin is a much more useful metric to look at, and that is unchanged in this example.

            Now, as I understand, there are some industries where profit margins have noticeably increased, and there are interesting questions that can be asked there. But profits going up simply isn’t a very interesting thing. Profits remaining static is actively a bad thing, because again, inflation is a thing. To flip this around, a worker never getting a raise in 20 years is obviously not doing very well. Workers need regular raises just to keep up with inflation. The exact same thing is true for businesses as well.

        • SeaJ@lemm.ee
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          1 year ago

          It’s actually record profit margins, not just record profits. Even industries that were not affected by shortages raised their prices and there was an increase in profit margins almost across the board.

          • BraveSirZaphod@kbin.social
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            1 year ago

            For sure, and I’m very much not saying that businesses are blameless or haven’t exploited the situation. I’d just vastly prefer reporting to talk about the metrics that actually matter, like profit margins, rather than essentially meaningless ones like net profit than do nothing more than push an obvious underlying agenda.

            From data I could find, you see a very sharp dip in margins during 2020, a significant rise in 2021-2022, and in 2023, things have largely returned to pre-pandemic numbers. I won’t pretend to be an economist, but if we’re going to be claiming uniquely bad corporate malfeasance, I want strong evidence showing that, not essentially meaningless fluff like “numbers go up in a highly inflationary environment”.