Posted on 08/12/2021 7:00:36 AM PDT by Oldeconomybuyer
NEW YORK — How to cope with the higher inflation sweeping the economy? For Corporate America, the answer so far is simple: Raise prices.
Companies are charging more for everything from diapers to auto parts, more than covering their own higher costs. They’ve been so successful that analysts say big U.S. companies’ profit margins have never been higher.
As a result, quarterly profit reports from S&P 500 companies the last few weeks have blown past Wall Street’s expectations. That’s helping to support record high stock prices despite worries that valuations have shot too high and that the delta variant of the coronavirus could hurt the economy.
Consider meat producer Tyson Foods, which has had to contend with higher costs for grain to feed its chickens and other sources of inflation. Yet its profit still leaped 42% in its latest quarter over the prior year.
Executives are talking more often about having to raise pay for their workers, rather than just higher prices for commodities. That kind of inflation can be more difficult for companies to mitigate.
Mentions of labor-related inflation jumped 107% for the second quarter from a year earlier, according to BofA Global Research, which analyzed conference calls that CEOs conducted with analysts following their earnings reports. That was a big jump from the prior quarter’s 12% rise.
That may also be a reason why analysts are forecasting a slight squeeze on corporate profit margins during the second half of the year.
No one expects companies to keep doubling their profits. This past quarter was likely the easiest of the recovery to deliver such eye-popping year-over-year growth, because it came 12 months after the worst of the COVID-19 economic shutdowns.
(Excerpt) Read more at apnews.com ...
They won’t soar for long.
Wages aren’t rising at the same rate as prices.
Yeah—That’s the way it works.
Same with taxes.
Try reading Thomas Sowell.
This is a different America. These Americans are entitled to low prices and high wages. If this keeps up, they’ll riot so they can steal that TV they want. And they’ll vote for different Democrats!
Unexpected.
One of my mutual funds last year made 57% Glad I saved all those years when I was young while my friends bought new boats, cars and toys
Opened a new package of Oreo’s last week. Inside 8 or 10 cookies were missing. That is inflation of the worst kind.
Isn’t that the saddest part. He’s been explaining this ad nauseum for decades. The man is amazing and has a way of explaining all of it in the easiest of terms.
These clowns like AOC, the rest of the Squad and Sanders are so dumb it makes me cringe. They’re supposedly so smart but they and their socialist, liberal hipster minions don’t have the slightest idea of how the tax code works and how those 70,000+ pages only help companies and the uber wealthy avoid paying them altogether.
And sadly, even if you were to sit a roomful of them down and explain to them how Amazon, GE, and so many other companies don’t pay a dime in taxes, they still wouldn’t understand/accept it and they’d demand they all pay more.
Same would go if you sat them down and explained to them how guys like Buffett and all those super, high net worth folks live their lives. They’d get mad, demand that they pay more, but still wouldn’t have the most basic understanding of how and why these folks do what they do.
I’m positive that the executives at large companies are all taking a cut in pay to help the customer.
Inflation - the most insidious tax of all, hitting the poor and middle class, those least able to afford it, in a most disproportionally onerous manner.
Sure, wages will EVENTUALLY rise, but never in enough volume to offset the cost to the consumer.
See my tagline.
Inflation also hurts the allies of liberals but this can be masked by printing counterfeit money and helicoptering it out into certain zip codes.
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“How to cope with the higher inflation sweeping the economy? For Corporate America, the answer so far is simple: Raise prices.”
Those wise sages at the Associated Press; you can’t put one past them. They’re just too sharp. Love that “so far” in there. So, inflation is the fault of Corporate America?
Wages are rising. But not for the right reasons. This is the obvious path for the “corporations” will take whenever a barrier to their profits is present. Be it… inflation or taxes… aka their ”fair share”
I’m positive that the executives at large companies are all taking a cut in pay to help the customer.
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The Left still loves all the Big Tech CEOs that are harrassing conservatives. Inflation is a small price to pay for that.
“One of my mutual funds last year made 57% Glad I saved all those years when I was young while my friends bought new boats, cars and toys”
For investors inflation is not necessarily bad news especially if one has a diversified portfolio.
I suppose the left wing morons will blame the retail businesses for raising prices while excusing the government as*holes for printing worthless dollars to fund their vote buying giveaways.
He said it the other day. “The Biden plan is working.”
He’s right, but not the way he thinks he is.
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