[foldingmoney]

>Higher interest rates won't stop greed.

we've just come off ~15 years of stubbornly low inflation. if the cause is greed, did companies only just become greedy in the last two years?

>It'll hurt families who need to buy a new car or need to sell their home though.

but it'll also stop punishing families who have savings. can't please everyone.

[gmerc]

They have been conditioned to become greedy. That’s how the system works.

You need to continually show growth. Actual profits don’t matter, it has to be expressed as growth.

The first one to blink loses as money flows out of the stock. So right now everyone is squeezing their business to avoid showing flagging growth. Jacking up prices.

Because investors only need growth, it doesn’t need to be sustainable - if there’s a general market correction that’s fine but you don’t want to be the one starting it.

Look at google. Ads is clearly on its last legs as a growth model but but aggressively pushing all levers like a cable company adding more and more ad breaks, they create the impression that things are still growing while gesturing at AI in hopes investors see the future growth there. No metric here measures the advance to the tipping point where customers abandon you to an alternative and they are not used to there being alternatives.

The current earnings season doesn’t show business health, they show greed dynamics.

[autoexec]

> did companies only just become greedy in the last two years?

No, but their greed was kept somewhat in check by consumers who'd rightly feel ripped off if they saw a company suddenly jacked up their prices. Before the pandemic companies generally didn't collude to all raise their prices at the exact same time.

When the pandemic first hit, companies lost a lot of money which they wanted to claw back somehow. There were some legit supply chain issues, but companies who were not affected by them said "We know our prices are sky high, but supply chain issues! We're all in this together!" and consumers bought the lie. Long after the supply chain issues improved companies still used them as an excuse. I don't blame consumers here. Things were going on that were totally unprecedented and giving companies some slack seemed perfectly reasonable given that surely we were all suffering.

Then as inflation started to soar it was all the news talked about and companies again said "We know you're going into debt to buy groceries, but it's not our fault! It's this damn inflation! We're all in this together!" and fewer consumers were believing their bullshit since by then the news was already talking about how those same companies were pulling in record profits and making money hand over fist, but since every company was doing it, consumers had little choice but to pay up or go without (which isn't always an option).

Companies have also tricked a lot of people with the narrative that the pathetic amount of disaster relief people got during the pandemic is to blame for inflation. I'm surprised how many people I see who are convinced that the $1000 checks people got to help pay off the record amounts of debt families went into to keep rent paid and food on the table is the real problem. This helped to deflect attention away from the fact that companies have been price gouging.

Lately they've been trying to use that same trick for everything. Some companies had to increase egg prices because of bird flu. The news reports it's the worst outbreak in almost a decade! Consumers are primed to expect egg prices to rise. The largest egg supplier in the country wasn't impacted by bird flu in any way, but they still raised their prices because they had an excuse and made over 700% more in profits. Cal-Maine Foods made a killing by ripping off the public who were already struggling and being taken advantage of. They got away with it entirely.

So companies were always greedy, but they didn't always have convenient excuses to point at to deflect the public's anger. Now they know they can lie to the public and collude to raise prices openly without fear of any repercussions.

The scapegoating scheme actually started a little bit before the pandemic with rising gas prices (notice how many companies increased their prices and told the public it was all because of gas prices but didn't lower their prices after the price of gas dropped?). They made money on that, and the pandemic was just the next major excuse. I suspect it's going to continue with companies looking for any and every excuse to jack up prices at insane rates.