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flanderguitar t1_itznmav wrote

Energy crisis...record profits. Tell me you're scamming the world without telling me you're scamming the world.

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sanash t1_itzrawe wrote

Same thing with the "inflation" issue. Corporations likely decided to fuck over the consumers to make up for the lower profits in 20-21, found that most people didn't change their spending habits because people still need to live.

They saw their quarterly reports and decided to say fuck it, keep the prices high and continue the screwing of consumers/workers.

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richalex2010 t1_iu0krm5 wrote

Normal inflation is definitely happening too, you can't print as much money as we did in the last couple of years without inflation. That's not the only thing causing prices to go up though.

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neok182 t1_iu4malb wrote

Absolutely but it's bullshit that the media and right wing plane 20-100% price increases on ~10% inflation.

Saw a post last week I think showing the average price of Halloween candy up 40% pre-pandemic. Inflation isn't 40% so that's just price gouging.

From gpus and cars to basically every single item in your grocery store it's 10% inflation and 90% corporate greed, profiteering and price gouging.

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chapstickbomber t1_iu69gap wrote

Profits are up $1T, 4% extra share of GDP, and some people don't see that as proof of price gouging. It's pretty fuckin funny.

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neok182 t1_iu6ax77 wrote

I know. Open your freaking eyes people. They are even bragging about it on quarterly profits. I think it was target that had a quarterly call where they actually said oh we have to stop raising prices because we hit how high people will actually spend on essentials.

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balbok7721 t1_iu3jjh2 wrote

And the energy crisis in Europe was just a dream. We don't need gas for literally anything. We don't need it for heat. We don't don't need is for chemistry. We don't need it for avoiding blackouts in France. We don't need it for chemistry. We don't need it for agriculture. And so forth.

When do people finally stop with that money supply bullshit. Yes, the US printed a shitton but there are more immediate factors in the play. Raising isn't a good idea because everything is funded by credit. Including that little housing crisis everyone is complaining about

I also didn't talk about China's bullshittery. There are so many factors without money supply that we should stop focusing on it

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thespawnkiller t1_itztrk4 wrote

They've been scamming the world for a long time. It's just getting more blatant because they know no one is going to stop them.

They're giving us all the middle finger and rubbing it our faces.

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Laruae t1_iu0csdk wrote

Nationalize the energy industry in each country and be done with it.

They are literally destroying the countries they sell energy to.

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graydf t1_iu0jyfy wrote

Fuck off commie.

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Cdwoods1 t1_iu0ll1n wrote

You really know how to make a compelling argument.

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Laruae t1_iu0uahb wrote

Nationalizing the energy sector doesn't make the country communist.

Many countries around the world have nationally owned or controlled powelines, train tracks, etc.

It works very well.

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UNOvven t1_iu14yy0 wrote

In fact, its when those nationally owned things get privatised that they tend to go to shit. See for example the UK railway system.

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graydf t1_iu19cu8 wrote

Ya that works great in Venezuela.

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kahurangi t1_iu2997n wrote

Not every country would be an energy exporter like Venezuela was, or get hammered with sanctions by the states presumably. This is pretty simple stuff, I'm sure if you applied yourself you'd be able to understand.

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StuStutterKing t1_iu33b2g wrote

I am an avowed capitalist. Capitalist markets, and specifically the modern global private market, are quite possibly the second greatest human achievement thus far behind Wikipedia.

Private markets, however, work best when competition is best. That is not necessarily true when it comes to public goods, such as natural resources and the energy grid. Here, stability, ease of access, and widespread infrastructure (even in areas where it may not be monetarily beneficial to do so) outweigh the current need for private variation and the additional profit margin.

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ActualSpiders t1_iu0igsf wrote

Once they realized people would blame anything else besides the corporations for the price increases, they just kept increasing prices. Funny, that.

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[deleted] t1_iu2biff wrote

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ActualSpiders t1_iu2efps wrote

Ummm, what? Oil cartels totally do decide on global energy prices. Look at what Saudi Arabia is trying to do right now...

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[deleted] t1_iu2o1d1 wrote

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ActualSpiders t1_iu2zgac wrote

Today you learned Saudi Arabia is one of the key & founding members of OPEC - the Organization of Petroleum Exporting Countries - and therefore part of the cartel that, by and large, does set oil prices on the world market.

And as has been noted repeatedly if only you'd read world news, they've been jacking their prices sky-high because they only recently noted that such price hikes would be blamed on political actors instead of the oil producers themselves.

This isn't rocket science.

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[deleted] t1_iu32t8c wrote

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ActualSpiders t1_iu3981o wrote

Sure. There's no connection between oil companies and oil producers. There's certainly no reason to think that oil companies making record profits has anything to do with the Saudi royal family combined being worth almost $1.5 trillion dollars. Yep, nothing linking those things at all.

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[deleted] t1_iu41ujl wrote

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ActualSpiders t1_iu56j99 wrote

No, it's the exact same reason every monopoly or cartel doesn't constantly raise their prices - a combination of topping out what the market can/will pay for the product (car travel in the US went down markedly over the spring & summer because gas was too expensive) and also wanting to stay "below the radar" because when consumers finally realize how they're being played they tend to demand action from their government.

This has all been studied extensively in economics & understood for generations now. Again, it ain't rocket science.

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[deleted] t1_iu59ln5 wrote

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ActualSpiders t1_iu5bac3 wrote

Supply and demand work differently in a market where supply is dominated by a cartel. Ho read some basic econ books and then get back to me because it's clear your understanding of the subject isn't sufficient to run a lemonade stand. Good day.

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HobbitFoot t1_itzxcg3 wrote

You don't make record profits when the price of the thing you still is low.

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thisvideoiswrong t1_iu0ajt3 wrote

You would if the free market were real. Profit margins are supposed to be miniscule because corporations have to compete for market share with the infinite number of other corporations making identical products, so they have to cut prices as much as they possibly can, and then find ways to lower costs further so they can lower prices more and get ahead. They're supposed to make money on volume when they come up with a way to do their business really well and get more market share. In that case low prices would mean a big innovation and more buyers, which would result in more profit.

But of course that's not how it works. There are only a handful of corporations in most lines of work, and they collude to set prices high together so they can all enjoy large profit margins. And covid and supply chain problems are giving them an excuse to increase those profit margins even further without people blaming them.

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HobbitFoot t1_iu0e00p wrote

That isn't how profit margins work in resource extraction.

Some sites have a low extraction cost, like Saudi Arabia, while other sites have a high extraction cost like Alberta. The cost of oil has little to do with the cost of extracting that oil.

So, when the price is low, it is economically viable for Saudi Arabia to pump while it isn't for Alberta. This is what restricts the supply. When the price is high, it is economically viable for both areas to pump, increasing supply. However, Saudi Arabia makes more money per gallon when the price is higher than when the price is low.

Substitution goods, like renewable energy, take years to build out. So, when you have an oil shock like now, it takes a while to stabilize. You may also have a case where the subscription good costs more.

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Mist_Rising t1_iu0x5n1 wrote

His economic theory is 101 level. It looks at the economy like everything else is equal, when in reality nothing is.

There are fields where his idea is closer to truth, fast food and grocery stores have low margins for example, but even then record prices occur at variable times. Grocery stores are making more currently due to inflation for example, but it's record profit that aren't as meaningful as it sounds.

He also forgot the capital part of capitalism, you can't just pluck a new company down and start selling. It takes money (capital) to build a store, get goods, get employees. This means competition is always based on how likely a return is for capital spent.

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thisvideoiswrong t1_iu3nh9g wrote

But if it's a free market then obviously there are no barriers to entry, so why haven't all the companies adopted this apparently better business strategy of pumping oil in Saudi Arabia? Obviously they can't, but that's the point. The Invisible Hand of the Free Market can only lead to the most positive results for society if consumers have perfect information, but we know almost nothing; have infinite choices, but we have at best a handful; and are totally rational, but humans are anything but. The market doesn't work in the real world, it just doesn't, and we have to stop pretending that whatever the market does must be right. We have to accept that government must intervene when the market fails.

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HobbitFoot t1_iu3s8yy wrote

So invade Saudi Arabia?

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thisvideoiswrong t1_iu3tg48 wrote

How about we start with an actually effective windfall profits tax (not building in absurd loopholes), and go on to jail time for executives implicated in price gouging if needed. On this issue, there's so much more we should be doing on so many issues.

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HobbitFoot t1_iu3udqg wrote

Is there price gouging or was it just the market reacting to a supply squeeze and existing infrastructure not in place to adjust for shifts in locations of supply?

At the point where the different governments want to dictate price, why not have consumer nations nationalize their energy industries?

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GreedyNovel t1_iubfklr wrote

Every economist in the world knows full well that the simplistic assumptions you've mentioned here aren't really true and are only there to help Econ 101 students start to learn the subject. If you study the field more deeply you'll see these assumptions are relaxed to varying degrees.

You aren't exactly breaking new ground here, you're just operating under the assumption that Econ 101 is being taught as the "Truth" to everything when in fact it isn't.

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thisvideoiswrong t1_iubiu6k wrote

Unfortunately there's a massive difference between what economists know and what conservative politicians talk about. And the media will never admit that those politicians are clearly wrong and probably deliberately lying (as a practical matter, when that power doesn't go to consumers it goes to big business, and conservatives care about little else besides what's good for big business). So in any policy discussion we get huge numbers of people saying that the market will take care of it, and they're wrong.

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GreedyNovel t1_iubnf90 wrote

Politicians always lie. Liberal politicians do too, of course, for their own special interests and donors.

It's all about convincing Joe Public who doesn't know very much or give much thought to these matters to peacefully line up at the polls instead of violently marching on the streets. Not much more than that, but that's socially useful too.

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groveborn t1_iu29vfr wrote

One corporation raises prices during a global crisis, it's gouging. All of them do it, it's inflation.

In this case, raise fuel prices and everyone has to raise prices - inflation.

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