Submitted by PleaseThinkFirst t3_10hyvis in technology
underwear11 t1_j5ficvs wrote
Reply to comment by Caraes_Naur in What High Tech and Media Layoffs Say About the Economy by PleaseThinkFirst
Considering majority of inflation was driven by rising corporate profits.....yea.
Also, they over hired and now are laying off the excess to make sure they can keep those profits and executive bonuses.
albert768 t1_j5fyel5 wrote
That is false.
Inflation is the growth of the money supply in excess of the growth in the supply of products and services. 100% of the inflation is driven by the government and government only. Last I checked, only the government can print money or deficit spend into oblivion (releasing money into the market without producing anything).
Slyguybuyfry t1_j5fivvn wrote
Why do you think this? This is not how economies work. It’s a fundamental misunderstanding of what inflation is and how it is caused.
Inflation in this cycle is driven by supply side constraints largely, as well as too much stimulus through Covid. Behind that is a labor shortage due to a slew of factors.
underwear11 t1_j5fn6fy wrote
It's somewhat debated in a chicken and egg way, but at the same time as inflation is getting to the highest levels in a long time, corporate profits are also hitting record highs. It's clear that companies are using the increased demand and "supply chain issues" to take in more profits.
Hawk13424 t1_j5haz6p wrote
Companies always take max profits. The question at this time is why can they take even higher profits. The reason is increased demand.
Slyguybuyfry t1_j5fodoq wrote
So no it’s not. Chicken/egg implies causation. All you have is correlation.
EPI is a sus source to link cuz it’s very left leaning in its bias. Probably why they essentially ignore or failed to mention record demand levels. Which would correlate and in many cases cause record profits. With or without an inflationary environment.
What causes record demand?
Cl1mh4224rd t1_j5fya5s wrote
>EPI is a sus source to link...
And you've linked nothing.
Slyguybuyfry t1_j5g01lx wrote
I’m not making the point that needs sourcing lol. Also not sure how linking something is a validation if anything. If you link garbage it just makes you sound silly
But here since you like links enough to make a pointless passive aggressive comment. And clearly have nothing substantive to add to the discussion.
rulesforrebels t1_j5g9i5z wrote
Hey buddy this is reddit capitalism is bad and the source of all the world's woes not shutting the economy down for two years throwing everything off
Slyguybuyfry t1_j5gkmef wrote
Appreciate that I'm not the only one that sees the hypocrisy in reddit echo chambers. That being said do disagree slightly on the first part, think the initial response was warranted until we had more data and vaccines. After that we should have opened up quicker.
Decimator714 t1_j5fqyh7 wrote
I don't know how it's not pretty obvious that printing 2 trillion dollars is going to cause massive inflation...
Slyguybuyfry t1_j5ftiib wrote
Hey it’s easier to downvote with zero economic knowledge and just believe in your feelings instead.
I mean come on. Isn’t it obvious? Companies just decided to charge more money because they wanted bigger executive compensation packages, and consumers are so on board with this that we also decided to buy at record rates. 🙃
rulesforrebels t1_j5g9o83 wrote
Why is this just happening now? Why is this just so coincidentally happening after printing 2 trillion at a time when nothing was being made and produced and trade and movement stopped around the world
Slyguybuyfry t1_j5glfia wrote
Well this is an incomplete take. That is but one factor, that helped drive demand. Through most of the last two years, we've been producing at unprecedented rates.
It's really a perfect storm of stimulus being slightly overdone, as a result demand being through the roof, while supply chains are intermitantly in dissaray, and labor shortage due to lack of immigration and periodic covid lockdowns and outbreaks in the workforce. Plus so many retired early as a result further creating a labor crisis. All that futher compounded by the rise of IoT and lockdown markets driving demand higher on tech. Everything needs a chip yet chip production was still 10 years behind.
Lot of supply side inflation here. Thats why interest rate hikes are taking such a long time to take effect, its an indirect way to impact the situation.
rulesforrebels t1_j5hmg98 wrote
We dont produce anything everything we consume is produced by China and they just opened back up
Slyguybuyfry t1_j5hpveq wrote
Eh depends on the industry. China is a big mfg for sure. Not sure what that had to do with my point tho. I was talking global.
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