‘We may be looking at the end of capitalism’: One of the world’s oldest and largest investment banks warns ‘Greedflation’ has gone too far

[Hawk_4shur]

All employers pay lip service to caring about their employees. It is very easy to say you care. Did you talk to any of the employees of these great employers?

Yes, all the time when I was serving the company as a CPA, and the employees in the companies I worked for.

Yes, employers give lip service when they say "Our employees are our #1 priority", when really their actions say growth and profits are #1 and #2. But, you really can't get anywhere with growth and profits without a solid workforce.

It all depends on upper management. They are just people too, and some are great employers, some are just pricks - like the rest of the population.

 

[Hawk_4shur]

But producer costs do not factor into price setting, nor should they.

Prices are set according to what the producer thinks they can sell at.

Seriously?,.. In reality prices are set by the following:

1. Total cost to produce
2. Desired profit margin
3. If available, any additional profit that a particular market might bear

There's some room to move around in the area between 2 & 3, but without 1 & 2 there's no reason to continue the business.

I think you're both right.

You make the product for as little as you can and sell it for the most you can. In between those numbers you factor in the quality target you want to meet the demand of your customer and support the price you choose.

 

[Hawk_4shur]

Fair points. But when you say "Capitalism sucks! It's just better than anything else" you are lending credence to the view that there aren't any alternatives.

It's not a choice between rapacious capitalism, monopolies and oligarchies or communism.

Nor is it a choice between rapacious capitalism, monopolies and oligarchies or food/products deserts.

The obvious alternative is better-regulated capitalism.

Much of our inflation today stems from unfettered price increases, unjustified by actual cost increases. Hence the record profits. Knowing this, why haven't there been regulatory efforts to rein in this blatant greed? And yes, "greed" is the right word.

When you are in position to set prices that lead to record prices, you do it because IT'S YOUR JOB. Imagine being in a Board room or upper management and you have an opportunity to set prices higher and keep the same level of sales. Would anyone say, "No, this price is high enough"? I don't think so.

The most disappointing thing to me is that I don't think record profits have had any effect on wages, or at least not very much. Growth and profits that outpace the availability of labor should have resulted in a higher demand for employees and thus upward pressure on wages - I don't think it has.

Yes, we need to break up monopolies. Yes, we need combat price-fixing among competitors. I think tax rates for corporations should go back up.

But I don't think you can regulate prices and still call it capitalism.

 

[RileyHawk]

The two locations have different demographics in the two mile circle surrounding each. One is by a McDonalds, the other is not. One is open all night, the other not. One has dry cleaning, the other not. One store is new, the other old. One store manager is nice, one is a dick.

All these things and countless others. all immeasurable ways, impact demand.

Harder to say items affecting supply. I suppose one is within the delivery circle of PDM, one just outside.

You're just babbling now. The fact is prices are set based on a myriad of factors, not just supply and demand. Your premise is ignorant of that fact.