I've read a lot of articles suggesting it's profit seeking, i.e., greed, and not monetary supply. We made the money printers go burr for a very long time with almost no inflation.
Comment on how long is the current era of inflation going to last?
Alimentar@lemm.ee 4 months ago
Until they stop printing money and devaluing the dollar…
Too many people think inflation only means price increases. That’s just a symptom. If banks and governments keep flooding the market with cheap loans and subsidies, you’re inflating the money supply, meaning you’re adding more money into circulation.
The more money sloshing around the more you’ll need to purchase goods (hence why your dollar starts to devalue)… And hence price increases.
And no government is doing enough to solve inflation, even with these rate hikes.
DarkGamer@kbin.social 4 months ago
Alimentar@lemm.ee 4 months ago
We made the money printers to brrr for a very long time with almost no inflation
You can’t print without consequences. The more you pump into circulation, the more currency you need to buy the same goods and services. You’re basically losing purchasing power.
If you give everyone a million dollars, you’re going to see prices increase. If prices don’t rise, people could buy out entire stocks of goods and you’ll have supply problems. So you need prices to increase to adjust for the amount of currency circulating. That’s inflation.
Bitrot@lemmy.sdf.org 4 months ago
If it was just devalued currency the corporations would also be dealing with a devalued currency and not recording record profits.
Alimentar@lemm.ee 4 months ago
Are these record profits adjusted for inflation? As in, are they earning more or is it nominally higher?
And yeah I mean it’s not just devalued currency, there are a lot of factors that go into inflation. But Id say it’s one of the biggest contributors for sure.
Interest rates stayed low for too long and people borrowed up to their eyeballs (corporations included), pumping a lot of currency into the market. That’s got to account for something no?
Bitrot@lemmy.sdf.org 4 months ago
Yes, that is adjusted for inflation. They raised prices beyond what was necessary to account for increased costs and had record high profit margins, so you had companies like ConAgra foods reporting profits 60% higher than the same quarter the year before, and people accepted it because of the pandemic and stimulus packages (“Biden dumped money in the economy!”) and labor shortages. It made a great scapegoat. Those loans existed before the pandemic, they really don’t account for what happened.
You can find a lot of information about greedflation.