7 minutes ago, EaglesRocker97 said:

 

Thank you. I appreciate your perspective, and I don't really have any issue with your explanation. Obviously, we can't just look at the raw dollar figures of profits, it really is margins that are in question here. Now, I don't necessarily discount the validity of your claim related to efficiency, although I would like to see a source indicating that the main reason to increasing profit margins is due to increased efficiency and not corporations padding the margins and then underhandedly blaming it on the increased labor costs. How can you even really prove such a thing when the figures are often closely held?

To be clear, I don't really fault a corporation for increasing their profit margins, because that's what a corporation is supposed to do: Make more money. I mainly posted this here just as a pushback against the right-wing narrative that higher wages are mainly responsible for causing higher prices for consumers (i.e., inflation). It's obviously a factor, but it seems that margins are vastly outstripping the cost of labor and materials. Basically, when you add up the increased costs of labor, materials, and transportation, the companies are still increasing their profits massively beyond the increased costs of production and distribution.

The increase in labor efficiency through automation has been a trend for over a decade now. That is continuing and accelerating due to wage increases. We own a national restaurant chain - due to wage increases, we introduced app based ordering so we can reduce staffing levels. That is happening everywhere. 
 

And yes - a company has an obligation to its shareholders to increase prices to the level that maximizes profits. Every company we own has done so, and the price increases have stuck. There is strong demand out there. 

9 minutes ago, vikas83 said:

Every company we own has done so, and the price increases have stuck. There is strong demand out there. 

I think that right there is the prime driver.

You have a lot of demand out there. We can certainly debate the reasons ... Pent up demand from significantly reduced spending during the pandemic; bullish consumer sentiment at least among the professional class regarding compensation; extra cash padding bank accounts from pandemic spending bills, etc. 

But the bottom line is that prices increase when demand outstrips supply. The supply chains are back moving a lot of goods to market, but demand is persisting. It will reach equilibrium and establish new market prices, and there's your price inflation normalizing.

 

13 minutes ago, vikas83 said:

The increase in labor efficiency through automation has been a trend for over a decade now. That is continuing and accelerating due to wage increases. We own a national restaurant chain - due to wage increases, we introduced app based ordering so we can reduce staffing levels. That is happening everywhere. 

It's certainly a trend, but I'm wondering how you account for it being the main driver of increases profits. I'm sure you're drawing a lot from personal experience, but I could see your experience being generally indicative of larger trends. I would expect it to somewhat vary by industry, though.

 

13 minutes ago, vikas83 said:

And yes - a company has an obligation to its shareholders to increase prices to the level that maximizes profits. Every company we own has done so, and the price increases have stuck. There is strong demand out there. 

 

And this is why, in a lot of cases, I ultimately blame...wait for it...the consumer. I look at certain industries a little differently, like foodstuffs one normally purchases in grocery store, than, say, food service. I have to really shake my head and roll my eyes at someone like Liz Warren posting hand-wringing Facebook statuses about companies like Chipotle and Starbucks increasing their profits. Like, these are food services and thus a luxury. If people were so upset with the price of a venti latte or whatever virus-laden burrito they loved, they could just...stop buying it. Not to mention, the products are crap anyway from those businesses, so I laugh at them for having both  poor taste and terrible financial awareness, lol.

Just now, JohnSnowsHair said:

I think that right there is the prime driver.

You have a lot of demand out there. We can certainly debate the reasons ... Pent up demand from significantly reduced spending during the pandemic; bullish consumer sentiment at least among the professional class regarding compensation; extra cash padding bank accounts from pandemic spending bills, etc. 

But the bottom line is that prices increase when demand outstrips supply. The supply chains are back moving a lot of goods to market, but demand is persisting. It will reach equilibrium and establish new market prices, and there's your price inflation normalizing.

 

One thing where the cost skyrocketed - chicken wings. We are now charging like $18.99 for a medium order, and people are paying it. 

1 minute ago, EaglesRocker97 said:

It's certainly a trend, but I'm wondering how you account for it being the main driver of increases profits. I'm sure you're drawing a lot from personal experience, but I could see your experience being generally indicative of larger trends. I would expect it to somewhat vary by industry, though.

 

 

And this is why, in a lot of cases, I ultimately blame...wait for it...the consumer. I look at certain industries a little differently, like foodstuffs one normally purchases in grocery store, than, say, food service. I have to really shake my head and roll my eyes at someone like Liz Warren posting hand-wringing Facebook statuses about companies like Chipotle and Starbucks increasing their profits. Like, these are food services and thus a luxury. If people were so upset with the price of a venti latter or whatever virus-laden burrito they loved, they could just...stop buying it. Not to mention, the products are crap anyway from those businesses, so I laugh at them for having both  poor taste and terrible financial awareness, lol.

There’s a lot of company and industry research which shows that the overwhelming driver of increased profits over the last couple decades has been labor efficiency gains. At first that was mainly from outsourcing to lower cost countries. Now it is from automation. This has been extensively studied. 

7 minutes ago, vikas83 said:

One thing where the cost skyrocketed - chicken wings. We are now charging like $18.99 for a medium order, and people are paying it. 

I don't even think there's a shortage of wings anymore. The shortages gave so much market information about price elasticity that this is more of a correction to maximize profits than anything else.

5 minutes ago, JohnSnowsHair said:

I don't even think there's a shortage of wings anymore. The shortages gave so much market information about price elasticity that this is more of a correction to maximize profits than anything else.

There is still a shortage, but it is not as acute as it once was. 

 

The problem with the truckers, is the same with the protesters chaining themselves to bank or government building doors to block traffic in protest of whatever.

Blocking access to commerce, hospitals, etc, it criminal behavior. Behavior the GOP was against, until they decided to try and overthrow an election.

On 2/23/2022 at 10:16 PM, JohnSnowsHair said:

I don't even think there's a shortage of wings anymore. The shortages gave so much market information about price elasticity that this is more of a correction to maximize profits than anything else.

All I can say is back when @4for4EaglesNest was posting stock photos of empty cooler shelves instead of just buying wings, I was smoking and saucing the ish out of dozens upon dozens of those tasty, glorious meat bones during the playoffs. I don't think I ever ate so many wings in that kind of time frame in my life. 

2 minutes ago, Boogyman said:

All I can say is back when @4for4EaglesNest was posting stock photos of empty cooler shelves instead of just buying wings, I was smoking and saucing the ish out of dozens upon dozens of those tasty, glorious meat bones during the playoffs. I don't think I ever ate so many wings in that kind of time frame in my life. 

So you caused the wing shortage 

27 minutes ago, JohnSnowsHair said:

So you caused the wing shortage 

Probably. And it was worth it. I still have a freezer full of those little suckers. Hot and honey. Mmmm

 

When WW3 happens I'll be sitting on my back deck munching fresh smoked wings as @4for4EaglesNest (completely wingless, mind you) is on the phone frantically trying to get truck drivers to move stuff for him.

'What a DISGRACE!!': California trucker convoy disbands, then angry supporters vent on Facebook

https://www.sfgate.com/california-politics/article/California-trucker-convoy-disbands-16956333.php
 

Quote

"The launch in California had a good turn out of supporters, but only 5 trucks were with us on arrival in Vegas," the organizers wrote in a Facebook post. "There are 2 other convoys that have massive turnouts, and are in progress to the DC area as we speak."

 

Trucker convoy made it to DC:

Look at the "massive turnout"  

The ship full of Porsches & Bentleys has sunk.

Traffic wasn’t any worse than your typical beltway weekday. We’ll see how it turns out. When they did this like 10 years ago or whatever it was a huge PIA.

 

 

The Stage of Freedom looks pretty free. Free of crowds, free of speakers.

 

Woooo!!

1 hour ago, 4for4EaglesNest said:

DC Beltway.....I don't miss that ish.  

It’s only gotten worse since lockdowns ended. More people and none of them can drive. Probably see 2-3 accidents every time I drive to NOVA.

47 minutes ago, TEW said:

It’s only gotten worse since lockdowns ended. More people and none of them can drive. Probably see 2-3 accidents every time I drive to NOVA.

Yes it has. Everyone got reckless during COVID. Empty roadways meant speeds went up, travel times went down, there wasn't the typical congestion. Now people want to drive the same way with much more traffic on the roads.  

On 2/25/2022 at 7:11 PM, Boogyman said:

Trump did this

$4.199 a gallon!

Wooooo

15 minutes ago, lynched1 said:

$4.199 a gallon!

Wooooo

How did you get that from me having a freezer full of chicken? You are hitting it real early on a Sunday like a true drunken loser I see. 

1 minute ago, Boogyman said:

How did you get that from me having a freezer full of chicken? You are hitting it real early on a Sunday like a true drunken loser I see. 

Chicken? You have my sympathies.

With the price of gas being what it is, I bet @lynched1 really wishes he had all that money back that he donated to stop the steal!

2 minutes ago, Boogyman said:

With the price of gas being what it is, I bet @lynched1 really wishes he had all that money back that he donated to stop the steal!

I only donated money to me.

I am considering swapping a vehicle to run on alcohol. Thought about converting a diesel but I'm not big on diesel engines anyway.

If the US can't manage fuel supplies properly I'll have to be responsible enough to do it on my own.

1 minute ago, lynched1 said:

I only donated money to me.

I am considering swapping a vehicle to run on alcohol. Thought about converting a diesel but I'm not big on diesel engines anyway.

If the US can't manage fuel supplies properly I'll have to be responsible enough to do it on my own.

Nobody believes that.

 

1 minute ago, Boogyman said:

Nobody believes that.

 

Good. I fail to see an advantage whether anyone does or not.