As long as you don't literally [old school meaning of that term] want to make “price-gauging” [sic] mandatory, but are literally [new school meaning] saying it just to make your points, bravo!
You’ve got a new fan.
Next you need to do a similar piece on why income inequality (so long as it’s not caused by crony capitalism government favoritism] is a *good* thing - when the Bezos’ and Musks of the world get stinking rich - not a bad thing.
I’m not saying you’re wrong here, but how would increased concentration of nearly every industry fit into the historical argument? Wouldn’t that start to unravel the “corporations have always been greedy” argument? And even in places where you don’t have tremendous concentration of a few firms, you have technological innovations that allow for collusion in price-setting (like the rent-setting algos currently in place across the country).
I get it, price controls are bad, but it’s a little bad faith to suggest that there aren’t some fundamental misalignments in the modern economy that contribute to inflation beyond government spending. I likewise believe this particular bit of messaging is nothing more than messaging, but at least they’re challenging the narrative?
I think when you invoke monopoly, you have to posit the mechanism that is increasing concentration. For example, if you think grocery prices are above competitive levels, why isn't anybody taking advantage of that? What's the barrier to entry? If, for instance, industry concentration only increased because some firms became relatively more efficient, then I don't think we can say that that's causing inflation.
On the other hand, in the rent-setting algo case you've provided a specific mechanism, so the story is more plausible (btw it looks like the FTC has a legit case). Ofc, I'm obliged to note that a big enabling factor here are the zoning laws and other government regulations that artificially restrict housing supply blah blah blah I'm sure you've heard the YIMBY pitch by now.
The concept of corporate greed as such is so obviously stupid - because every average middle class person owning a few shares as investment want those shares to go well and would fire a CEO that does not make them go well - that, because I believe in humanity, I propose that it is not meant literally.
It is sort of a proxy term for something else.
Maybe lack of regulations, although I don't think many people seriously want price ceilings.
Maybe lack of adequate market forces, lack of competition, lack of options.
Maybe wages not keeping up with prices, so it is hard to understand what kinds of costs, if not wages, were pushing prices up. (Maybe energy, maybe materials, maybe regulations, maybe sanctions on Russia, maybe wages in China, I have noticed that all these super economists like yourself did not actually explain what is actually causing this inflation, only what is not, which is not super useful.)
Inflation, as Milton Friedman taught, is primarily caused by too much money chasing too few goods.
Which is clearly what happened this time around with Fed fiscal and monetary policy.
And then it was made worse by the Fed and the Treasury secretary saying they WANTED inflation to go up. When it went up and they couldn’t/didn’t immediately tamp it down, they set in motion inflationary expectations that made it worse.
Re: wages not keeping up with prices, as is often (not always, but often/usually) the case, those with assets did more than ok under this round of inflation, those who did not did worse. Then this was compunded with minimum wage laws and artificially induced reduced supply (from the extra money given out during COVID to people not working) of low-cost, low-skilled labor, so prices for things like fast-food went up MUCH faster than inflation, such that for lower-income households, even if their wages went up exactly in line with inflation averages, they were left much worse off than when the inflation binge started.
There are good articles on Substack and elsewhere that explain these issues if you search for them.
As long as you don't literally [old school meaning of that term] want to make “price-gauging” [sic] mandatory, but are literally [new school meaning] saying it just to make your points, bravo!
You’ve got a new fan.
Next you need to do a similar piece on why income inequality (so long as it’s not caused by crony capitalism government favoritism] is a *good* thing - when the Bezos’ and Musks of the world get stinking rich - not a bad thing.
Unless I beat you to it. 😏
I’m not saying you’re wrong here, but how would increased concentration of nearly every industry fit into the historical argument? Wouldn’t that start to unravel the “corporations have always been greedy” argument? And even in places where you don’t have tremendous concentration of a few firms, you have technological innovations that allow for collusion in price-setting (like the rent-setting algos currently in place across the country).
I get it, price controls are bad, but it’s a little bad faith to suggest that there aren’t some fundamental misalignments in the modern economy that contribute to inflation beyond government spending. I likewise believe this particular bit of messaging is nothing more than messaging, but at least they’re challenging the narrative?
I think when you invoke monopoly, you have to posit the mechanism that is increasing concentration. For example, if you think grocery prices are above competitive levels, why isn't anybody taking advantage of that? What's the barrier to entry? If, for instance, industry concentration only increased because some firms became relatively more efficient, then I don't think we can say that that's causing inflation.
On the other hand, in the rent-setting algo case you've provided a specific mechanism, so the story is more plausible (btw it looks like the FTC has a legit case). Ofc, I'm obliged to note that a big enabling factor here are the zoning laws and other government regulations that artificially restrict housing supply blah blah blah I'm sure you've heard the YIMBY pitch by now.
Love it! Wish this would happen
The concept of corporate greed as such is so obviously stupid - because every average middle class person owning a few shares as investment want those shares to go well and would fire a CEO that does not make them go well - that, because I believe in humanity, I propose that it is not meant literally.
It is sort of a proxy term for something else.
Maybe lack of regulations, although I don't think many people seriously want price ceilings.
Maybe lack of adequate market forces, lack of competition, lack of options.
Maybe wages not keeping up with prices, so it is hard to understand what kinds of costs, if not wages, were pushing prices up. (Maybe energy, maybe materials, maybe regulations, maybe sanctions on Russia, maybe wages in China, I have noticed that all these super economists like yourself did not actually explain what is actually causing this inflation, only what is not, which is not super useful.)
Inflation, as Milton Friedman taught, is primarily caused by too much money chasing too few goods.
Which is clearly what happened this time around with Fed fiscal and monetary policy.
And then it was made worse by the Fed and the Treasury secretary saying they WANTED inflation to go up. When it went up and they couldn’t/didn’t immediately tamp it down, they set in motion inflationary expectations that made it worse.
Re: wages not keeping up with prices, as is often (not always, but often/usually) the case, those with assets did more than ok under this round of inflation, those who did not did worse. Then this was compunded with minimum wage laws and artificially induced reduced supply (from the extra money given out during COVID to people not working) of low-cost, low-skilled labor, so prices for things like fast-food went up MUCH faster than inflation, such that for lower-income households, even if their wages went up exactly in line with inflation averages, they were left much worse off than when the inflation binge started.
There are good articles on Substack and elsewhere that explain these issues if you search for them.
Generic issue: https://www.dallasfed.org/research/economics/2023/0110
This time around specifics (first 3 points): https://asocial.substack.com/p/friday-fun-june-21-reading-about