Catastrophic elite failure is destroying the economic foundations of the West - "Easy money has already convinced politicians that they no longer have a budget constraint and it is safe to turn on the spending taps. People’s QE, which started as a fringe hard-Left idea, is mainstream; many “experts” now argue that we should increase our “excessively low” national debt by at least 50 per cent. Cheap money is even behind the rise of the woke corporation, including the emergence of an unproductive yet highly paid segment of the middle class devoted to virtue-signalling. Inflation, by damaging risk-free savings such as cash and gilts, has encouraged riskier investment in stocks and shares, helping big fund managers, especially those that operate tracker funds, to tighten their grip. Because these funds don’t seek to beat the market, they have embraced an alternative role as woke enforcers, forcing private firms to sign up to endless green and social targets. Cheap money has also encouraged companies to pursue low-profitability projects and to become lazier and less efficient. This has empowered the worst kind of corporate bureaucrat, sapped the dynamism of many firms and encouraged them to self-indulgently put wokery before profits."
From 2021
Meme - "Our raise *woman with small breasts*
Inflation *woman with big breasts*"
Opinion | How Inflation Killed Bidenomics - "I started noticing in 2018 that economists I knew were receiving grants from the California-based Hewlett Foundation. These grants were part of an organized effort to develop an alternative to neoliberalism, an intellectual framework that Hewlett said had “outlived its usefulness.” Hewlett defined neoliberalism as a paradigm focused on free markets, limited government, maximum growth and individuals competing to improve their welfare. This paradigm, Hewlett argued, led to a mistrust of government, fear of public investment, drive for deregulation and preference for free trade. It became prominent after the stagflation of the 1970s, which undercut the credibility of Keynesian demand-side macroeconomic policy. Hewlett argued that more recent developments—wage stagnation, wealth inequality, and some negative effects of free trade—had weakened the appeal of neoliberalism. It was time to birth something new, and the foundation would be the midwife... The Biden administration, unsurprisingly, made significant departures from neoliberalism. The administration’s economic strategy included industrial policy, worker power, antitrust policy, a shift away from free trade, and a reorienting of fiscal and monetary policy away from capital toward labor. Several of these measures yielded tangible results, but the new macroeconomic policy proved fatal for the administration. The Hewlett report insisted that neoliberalism had hurt workers by focusing on inflation rather than unemployment. Why was it, the report asked, that after a long period of rock-bottom interest rates, inflation was “too low”? The report asserted: “If economic developments over the past decade show anything, it is that there is greater headroom for spending without causing undue inflation.” Governments, Hewlett argued, can spend more on efforts to boost demand “without worrying about inflation quite so frantically.” A few months later, Mr. Biden signed into law the American Rescue Plan, a nearly $2 trillion stimulus package on top of the trillions the Trump administration had spent during the pandemic. Three years later, the consumer-price index showed a 20% overall price increase. The inflation over which the Biden administration presided dramatically undermined Kamala Harris’s electoral prospects. Some Democratic-leaning economists have argued that inflation was a global, pandemic-induced supply shock on which fiscal stimulus had little or no effect. To his credit, Jared Bernstein, Mr. Biden’s chief economic adviser, doesn’t take this easy way out. In a recent interview with the New York Times, he said the inflation of recent years “was exacerbated by strong demand, no question. So I’m not giving fiscal policy a pass.” The Biden administration’s fiscal stimulus was developed within the intellectual framework that the Hewlett Foundation helped create. In 2021 Mr. Bernstein told the Times that the American Rescue Plan’s purpose was to “run the economy with a little more heat”—that is, to set aside inflationary concerns in favor of faster labor-market gains. “We certainly got more heat than I envisioned at the time,” he now admits, but he adds that 20-20 hindsight was a luxury the administration couldn’t afford during the pandemic. What about 20-20 foresight, which inflation-wary dissenters such as former Treasury Secretary Larry Summers offered early in 2021? It was the responsibility of the president’s political advisers, and of the president himself, to weigh the risks of pedal-to-the-metal economic stimulus. Mr. Biden should have understood the risks of rising prices: He was already in his second Senate term when inflation undermined President Jimmy Carter’s administration. Despite presiding over a slow recovery from the Great Recession, President Obama comfortably won re-election. Ms. Harris wasn’t so fortunate. That’s because while unemployment disproportionately affects a portion of the electorate, inflation hits everyone—especially working-class Americans who can’t evade its effects... Hewlett was right about the need for alternatives to the economic policies of recent decades. But in a democracy, such policies must pass the test of public approval. Pretending inflation wasn’t a big deal didn’t and won’t."
Weird. We keep being told that blaming governments for inflation is wrong, fake news and misinformation
Meme - "The DNC learning that women buy groceries more often than they get abortions"
Private-label food got more popular thanks to inflation — but now it's here to stay
McDonald's $5 meal deal blamed for demise of french fry factory - "Boss Thomas Werner said that demand for fries is falling because of smaller portion sizes included in discount deals. Burger King and Wendy's have near-identical $5 meals too... around 80 percent of french fries consumed in the US come from fast-food chains"
PepsiCo Ups Snack Sizes as Buyers Push Back on Shrinkflation - "PepsiCo announces that popular snack brands like Doritos, Lay's, Ruffles, and Tostitos soon will contain 20% more product without a price increase. This move comes after years of frustration as customers noticed their snack bags shrinking while prices remained the same. PepsiCo, the largest producer of salty snacks in the U.S., confirmed the change according to El Economista, attributing it to shifting consumer behavior. As snack portions shrank, many shoppers began opting for cheaper alternatives or private label brands from retailers like Walmart and Costco. This trend had a noticeable impact on PepsiCo’s sales. In the third quarter of 2024, the company reported a 0.5% decline in snack sales compared to the same period in 2023, with snack volumes down by 1.1%, according to a report by Bank of America."
Did Inflation Save Us From 'New Progressive Economics'? - "President Joe Biden obviously was not the left's preferred candidate in the 2020 Democratic primary. But, as Prokop tells it, he staffed his administration with lots of ultra-progressive wonks and political operatives who wanted to overthrow the Democratic Party's perceived "neoliberal" consensus on trade and regulation in favor of aggressive anti-trust enforcement, proactive industrial policy, protectionism, and a massive increase in social spending. They basically got most of what they wanted, starting with the $1.9 trillion American Rescue Plan (ARP)—a law pitched as a pandemic recovery bill that was stuffed full of progressive spending items. Now, however, depression is setting among the New Progressives. There's a good chance that no matter what happens in November, they'll see their influence and policy legacy crumble... they have only themselves to blame. Biden is historically unpopular. Voters give him extremely low marks for his handling of the economy, and they rank the economy as their number one issue. The president headed for defeat even before his disastrous debate with Trump. Polling has consistently shown that voters are mad about decades-high inflation and the cost of living specifically. Prices went up under Biden, voters got mad, and they stayed mad. Inflation didn't just happen on Biden's watch. His budget-busting American Rescue Plan—which dumped a bunch of monopoly money on an already recovering post-pandemic economy—predictably sent prices through the roof. At the time, "neoliberal" economists who'd held prominent positions in previous Democratic administrations, but had been largely replaced by the New Progressive types Prokop profiles, publicly warned that the ARP was too big and would generate lots of inflation. The New Progressives shrugged off these criticisms as reactionary snipping from careerists steaming over their loss of power and influence. But neoliberals turned out to be right. Progressive dismissals of their warnings ended up endangering their entire political project... While high inflation makes voters mad about the status quo, it also leads them to endorse dangerous policies to counter it. While Harris is not running as a progressive firebrand, she has been willing to endorse radical price and rent controls to deal specifically with the problem of rising prices. If she wins in November, it's possible she'll press for those policies—and we'll have inflation to thank for that too."
Left wingers just blame "corporate greed" instead
Americans Feel Poorer Because They Are Poorer - "Many progressives would chalk up the prevailing negative economic mood to poor messaging and flagrant disinformation. Conservative politicians and pundits, they say, keep telling their supporters that Joe Biden and Kamala Harris have failed miserably on the economy, causing average Americans to conclude that the economy is far worse than it really is. If people stopped listening to this propaganda, reviewed the data, and trusted the experts, they would realize their good fortune of being an American worker and consumer in the year 2024. However, there's more to the data than meets the eye, much of it demonstrating why Americans feel their quality of life has diminished over the past few years. In general, the headlines for the jobs reports don't distinguish between part- and full-time jobs, public- and private-sector jobs, and American and non-American workers. According to columnist Jeffrey Tucker, most of the surge in jobs has been in part-time, government-created positions held by non-Americans. Even if this all contributes to a higher GDP, each of these factors take a toll on Americans and their communities. More people are working multiple jobs, indicating that the cost of living has gone up for everyone. I know a number of teachers who have to supplement their income by taking on seasonal retail jobs, driving for Uber, or conducting extra duties during off-hours. Many live far from where they work because they can't afford houses in urban areas and end up commuting for hours each day. Even five years ago, this was rare; now, it's pretty normal."
Bonchie on X - "Shirtless dude holding a beer takes this CNN reporter apart after she suggests he shouldn’t care about inflation. King stuff."
Stephen L. Miller on X - "CNN having a harder debate with a shirtless rando than with the Democratic Party nominee is just about perfect."
Inflation and the Common Knowledge Game - "For months now, Missionaries large and small have been saying that inflation is here and inflation is well-embedded. But when the most powerful Missionary in the world, Jay Powell, says that inflation is no longer “transitory” … well, now everyone knows that everyone knows that inflation is here to stay. And when everyone knows that everyone knows that inflation is here to stay, ALL businesses can raise prices to maintain margins without fear of competitive pressure or customer pushback... At whatever point in time you think inflation will start to fade, you are being too optimistic."
From December 2021. Inflation fell a lot faster than he claimed it would
Think corporate greed is the leading cause of inflation? Think again - "Some progressives have frequently blamed corporate greed for fueling the high cost of living that Americans are fed up with. Yet new research from the Federal Reserve Bank of San Francisco casts doubt on the greedflation theory. Economists at the SF Fed found that corporate price gouging was not a primary catalyst for the inflation surge of 2021 to 2022. The Fed researchers did find that some companies exercised pricing power by raising prices above their production costs – a gap known as markups. For instance, markups spiked for gasoline, cars and other goods in 2021. Likewise, there were increased markups for repair, general merchandise, laundry, personal care and other services, according to the Fed... When zooming out and looking at markups across the economy, the SF Fed economists found little evidence that price gouging was the main culprit. “Aggregate markups – the more relevant measure for overall inflation – have stayed essentially flat since the start of the recovery,” the paper concluded. “Rising markups have not been a main driver of the recent surge and subsequent decline in inflation during the current recovery.” In fact, the SF Fed found that the path of collective markups over the past three years “is not unusual compared with previous recoveries.” This runs counters to the argument from some progressives including Sen. Elizabeth Warren, who for years has refocused the inflation argument on corporate greed. “Right now prices are up at the pump, at the supermarket, and online. At the same time, energy companies, grocery companies, and online retailers are reporting record profits,” Warren said in December 2021. “That’s not simply a pandemic issue. It’s not simply some inevitable economic force of nature. It’s greed—and in some cases, it is flatly illegal.” More recently, President Joe Biden has called out corporate greed as a reason prices remain high... Although the paper did not directly mention corporate greed, shrinkflation or Biden, the research undercuts the argument that greedflation drove the early inflation... Consumer sentiment, a metric closely tracked by the White House, unexpectedly tumbled to a six-month low at the start of May. It was the biggest one-month drop in nearly three years, a deterioration driven in part by concerns about inflation and interest rates. Greg Valliere, chief US policy strategist at AGF Investments, said the White House is “desperate to blame someone or something for inflation.” “Blaming greedy corporations is just looking for scapegoats,” Valliere told CNN. “There’s no prescriptions here that would have a major impact quickly, other than the Fed reluctantly raising interest rates – an option that, incredibly, isn’t out of the question.” Many economists blame the recent inflation surge on more traditional factors, namely higher production costs linked to swings in demand and Covid-era supply trouble... Last year, the Federal Reserve Bank of Kansas City found that corporate profits contributed 41% to inflation during the first two years of the Covid recovery. However, that same Kansas City Fed paper noted that this is not unusual and corporate profits contributed even more (59% on average) to inflation during prior economic recoveries."
William Watson: Uh-oh, Democrats. New research says Americans don’t want any inflation - "The inflation rate that Americans preferred on average? Just 0.2 per cent — one-tenth the official Fed target. In total, the researchers found, 83.47 per cent of respondents preferred an inflation rate lower than what the Fed is aiming at... What the research makes most clear, however, is that Americans really don’t like inflation. If you were running for president, having been vice-president to someone who had produced nine per cent inflation in 2022, and having yourself signed the cynically named “Inflation Reduction Act,” you should probably worry about that."
Unfortunately the article doesn't go into why inflation of 0% might not be a good idea
Meme - "CORPORATE GREED TIMELINE
Postwar greed spikes *high inflation*
The good old days, when companies were generous *low inflation*
The Great Greed Explosion of the 70s *high inflation*
Gordon Gekko *high inflation*
The Long Generosity of the 80s and 90s *low inflation*
extreme generosity in 2008 *low inflation*
The return of greed *high inflation*
A history of the times when corporations decided to be greedy, or generous, suddenly and for no particular reason."
How McDonald's became the villain of the inflation story - "In the national food fight over who is to blame for inflation, the casual-dining stalwart Chili’s has a new campaign that singles out one villain in particular: fast food. A new arcade-era-style promotional game pushing a deal involving its Big Smasher burger invites players to square off against “the evil Fast Food Syndicate,” which for years has “raised burger prices and lowered quality, even on its so-called ‘value meals.’... the president of McDonald’s USA, Joe Erlinger, went so far as to publish an open letter pushing back on “viral social posts and poorly sourced reports that McDonald’s has raised prices significantly beyond inflationary rates.” He denied, for example, online chatter that the average price of a Big Mac is up 100% since 2019; it’s up 21%, he said, pointing to economy-wide inflation pressures. Still, that’s a notable increase, and this week—in a sign that McDonald’s is taking the gripes seriously—it rolled out a new limited time $5 meal deal (joining a number of fast-food competitors offering value promotions). In addition, the chain announced new promotions tied to its app, most notably a Free Fries Friday offer running through the end of the year. Even this has been met with some skepticism: On social media, Mickey D critics argue that the company only wants to lure in-app users to collect data, and perhaps eventually implement a surge pricing scheme. This is largely speculation... the burger giant has been dogged by viral anecdotes of surprisingly high prices at some specific franchises—a $17.59 Big Mac meal, $5.69 for hash browns, and so on. Still, well into 2023, the company seemed able to shrug off such tales because it was among those whose customers were apparently willing to absorb higher prices; in the first quarter that year, same-store sales rose a robust 12%. More recently, that’s changed. In a May survey of 2,000 consumers conducted by LendingTree, 65% said they’d been “shocked” by a high fast-food bill in the past six months. Nearly 80% consider fast food a “luxury,” and 62% say they’re eating it less. (Notably, 78% say they are concerned about the potential for surge pricing.) A separate Axios Harris poll, also from May, found trust scores for big quick-service brands including McDonald’s had fallen, and chalked up the dip largely to higher prices and/or “shrinkflation” (that is, smaller portions)... Olive Garden and other such chains seem to collectively sense an opportunity—partly because they offer a better experience for the money, and their prices have risen less than those in the fast-food category. “We turned up the heat on fast food,” Chili’s marketing chief said in a statement, noting that its Smasher Burger deal is year-round, not a one-off. And as the CEO of Applebee’s added, its burger deal isn’t something you “eat in a bag out of your car.””
This Canadian restaurant just lowered its prices. Here's how it did it - "A Canadian restaurant lowered its prices this week, and though news of price tags dropping rather than climbing sounds unusual, the business strategy in this case is not, according to experts in the field. Kinton Ramen, founded on Baldwin Street in Toronto in 2012, lowered the cost of its ramen bowl by approximately $2 on Monday, from $17 to $14.99. The answer to the obvious follow-up question – how did a local business bring prices down while food costs remain high? – is simple: franchising... The expansion, which now spans Ontario, Quebec, British Columbia, Illinois and New York, has enabled the restaurant to negotiate with suppliers, according to Kinka Family Senior Director of Franchise Development, Karalyn White."
Americans Are Mad About All the Wrong Costs - The Atlantic - "it is the big-ticket, fixed costs that have had the most deleterious impact on family finances over time. These are the costs that are truly sapping average Americans’ ambitions to get ahead, and they are not going down. From the aughts until the onset of the coronavirus pandemic, inflation was essentially a nonissue in American life. The country was suffering from anemic growth and anemic demand: low interest rates, low productivity growth, stagnant wages, and high inequality. The only upshot, really, was that prices were stable and stuff was cheap... For decades, continuously high prices on big-ticket goods and services have been quietly eating away at American incomes and forcing families to make miserable financial decisions: to delay getting married, to give up the dream of a third kid, to settle in an exurb rather than a city, to put off starting a business. First, and by far worst, is housing. When the real-estate bubble collapsed during the George W. Bush administration, residential construction cratered and never fully recovered. We are building as many homes now as we were in 1959, though the population has doubled... Second is the cost of health care. The United States spends 17 percent of its GDP on health services, nearly twice the OECD average, for no better outcomes... Third, child care... These obscene costs for working families do not translate into living wages for child-care workers, many of whom live in poverty... No wonder Americans report feeling like they just are not able to get ahead, no matter how much they are earning. In interviews, many folks tell me they simply do not believe that wage growth has outpaced inflation, or that wage growth has been stronger for low-income families than for high-income families, or that middle-class families are wealthier today than they were a few years ago, or that inflation has cooled off to unremarkable levels, despite all of those things being true... Washington has a huge range of options to increase demand in the economy. It can send families checks, amp up unemployment-insurance payments, and cut interest rates down to scratch. It has very few options to control costs and even fewer to increase supply, particularly because building homes, hiring nurses, and constructing new day-care centers would be inflationary in and of itself."
Opinion: Beyond the Bank of Canada’s rate hikes: The era of low interest rates is over - The Globe and Mail - "in the wake of the pandemic and amid the tensions with China and Russia, businesses are now shifting their supply chains to build resilience and reduce risk. Future capital investment will be determined by more than just the cost of production, including geopolitical risk and ESG considerations. This will raise prices and make it harder for central banks to control inflation. Moreover, the aging population across the Western world, including Canada, and the retirement of baby boomers has started to materially affect Canada’s labour market. Immigration will take some of the pressure off, but it will not solve Canada’s labour supply and skills shortages. There will also be more international competition for talent. Labour scarcity at home and abroad should raise the cost of labour, which will be passed along to consumers with higher prices unless firms find a way to materially boost productivity... during the pandemic, firms discovered the vulnerability of just-in-time inventory systems, in which goods are ordered from suppliers only as needed. Many firms could not meet demand from existing stockpiles. To reduce this risk, businesses may carry higher inventory levels, and this means more volatility in stockpiles as demand ebbs and flows. The greater inventory swings can add to economic volatility and, in turn, greater volatility in interest rates."
ESG has very real harms
Starbucks, McDonald's, Yum earnings show consumers pulling back - "It’s finally here: the long-predicted consumer pullback. Starbucks announced a surprise drop in same-store sales for its latest quarter, sending its shares down 17% on Wednesday. Pizza Hut and KFC also reported shrinking same-store sales. And even stalwart McDonald’s said it has adopted a “street-fighting mentality” to compete for value-minded diners. For months, economists have been predicting that consumers would cut back on their spending in response to higher prices and interest rates. But it’s taken a while for fast-food chains to see their sales actually shrink, despite several quarters of warnings to investors that low-income consumers were weakening and other diners were trading down from pricier options... Restaurant Brands International’s Popeyes reported same-store sales growth of 5.7%."
Terrorism supporters were cheering and claiming their boycotts were responsible. But Popeyes is on the boycott list too
Apple stops selling iPhones and other products in Turkey as lira plunges - "People in Turkey have seen error messages as they attempt to buy iPhones and other products from Apple, as the country’s currency plunged. Users were able to browse the Apple Store website but found they were unable to check out. The problems come amid a historic 15% plunge in the lira the day before caused havoc for prices. The currency slipped back towards its record low on Wednesday, driven by worries over broader fallout for the economy after President Tayyip Erdogan defended recent sharp rate cuts despite widespread criticism and calls for a reversal. The lira has lost 43% of its value this year and more than 22% since the beginning of last week alone... A sales representative at an Istanbul Apple store told Reuters people were thinking of electronics as an investment as much as items to use. “It is pretty surreal with the economy and all, but people see it as a store of value and flock to stores. They know they’ll be able to sell it a year later for more than what they paid,” the person said, requesting anonymity."
From 2021
