Economy Continued Inflation or a recession?

[MMAisGod]

Inflation is back up to 3.4%.

Time to raise them rates back up. Anything short of 99.99% is inefficient.

 

[BROWNPRIDE]

Inflation. Thanks Trump

 

[44nutman]

Inflation is back up to 3.4%.

Market took a giant red shit this morning but has been fighting back.

 

[SummerStriker]

3.4 isn't bad. Historical is 3%. Who cares. The fed has done a great job, honestly. Far better than I imagined. I say let them cook.

 

[Jack V Savage]

I can only think of one person here who was predicting a three handle by this point.

 

[NickNick]

At what point is it no longer inflation and just pure greed/price gouging?

 

[Jack V Savage]

At what point is it no longer inflation and just pure greed/price gouging?

At all times, companies would like to be able to raise their prices. The question is what allows them to do it without losing business.

 

[NickNick]

At all times, companies would like to be able to raise their prices. The question is what allows them to do it without losing business.

Well with a lot of things people don't have a choice (groceries, gas, insurance, etc.) They saw that people kept consuming when prices were jacked up with the excuse of "supply chain issues", why shouldn't they stop?

 

[Jack V Savage]

Well with a lot of things people don't have a choice (groceries, gas, insurance, etc.) They saw that people kept consuming when prices were jacked up with the excuse of "supply chain issues", why shouldn't they stop?

But the reason they get away with it (and that competitors don't just undercut them) is that the population as a whole has more money to spend (and spending is rising a little faster than our collective ability to provide desired goods and services).

 

[Scheme]

Well with a lot of things people don't have a choice (groceries, gas, insurance, etc.) They saw that people kept consuming when prices were jacked up with the excuse of "supply chain issues", why shouldn't they stop?

Prices are the last thing that a company ever wants to raise because of it's visibility and ability to be undercut. They'd much rather increase profits via cutting costs, shrinkflation, etc. Prices are the very last resort for things like groceries because a sizeable amount of customers simply shop based on prices rather than quality or other factors.

 

[LMP]

I think there are two things to consider.current inflation has been driven by corporate profits. Job growth leads to more immigration. It appears to me that increasing the tax rates on corporations could be a way to also slow down the economic growth, if that is a concern.

 

[cincymma79]

I think people should stop giving you shit, and either say something or shut up. But can you explain what you mean when you're talking about growth? I'm not necessarily disagreeing, just coming at this using the only perspective from which I can come, my own. For me, every expense has gone up by a considerable amount, and my annual increase was 2.5% which is essentially my company spitting in my face. I'm cutting costs and not really seeing any upside. I understand I'm not the end all be all, but I feel like my earning is above average and the sting is real.

That’s because you’re a nazi and hate trans people. Also remember, this is the guy that told you that inflation was transitory several years ago.

 

[NickNick]

Prices are the last thing that a company ever wants to raise because of it's visibility and ability to be undercut. They'd much rather increase profits via cutting costs, shrinkflation, etc. Prices are the very last resort for things like groceries because a sizeable amount of customers simply shop based on prices rather than quality or other factors.

Maybe things were like that at some point, but then the pandemic happened which brought supply chain issues and they realized that they can jack the prices up and people will continue to consume and if they all do it, then well no one is getting undercut.

 

[cincymma79]

Don’t Expect a Return to Ultra-Low Interest Rates

And that’s a good thing.

www.bloomberg.com

 

[Andy Capp]

I think there are two things to consider.current inflation has been driven by corporate profits. Job growth leads to more immigration. It appears to me that increasing the tax rates on corporations could be a way to also slow down the economic growth, if that is a concern.

Akshualllly...... lol

But seriously, I think the spike in inflation was fundamentally driven--aside from worldwide supply chain issues, obviously--by pent up demand from people having huge cash reserves on account of having nowhere to spend their money while pandemic public health measures were in force.

People seem to forget that although there was high unemployment, it wasn't that high. A fairly large majority of people still had productive employment and in many cases they made even more money during the pandemic than they had before, but what to do with it?

When people feel they've spent enough, inflationary pressure will ease, IMO. I have felt all along it was just a matter of waiting it out. Although I can understand the need for interest rate increases to cool the economy, in Canada at least, I believe they should have started lowering them again by now but they haven't.

 

[N13]

Both

The real problem is in the US treasury bond market. The fed is fucked.

 

[emefer]

At all times, companies would like to be able to raise their prices. The question is what allows them to do it without losing business.

Lack of competition

 

[N13]

Lack of competition

And a lot of the time it's monopolistic competition.

 

[ArtardFiesta]

how would cutting rates lead to lower inflation? it would encourage more borrowing and possibly increase inflation

 

[emefer]

And a lot of the time it's monopolistic competition.

Yep. When you only have a handful of competitors the competition will be how high can we go.