In my experience the vast majority of people do not understand how monetary policy affects inflation. People very quickly adopt a “if you see prices rising, it's corporate greed" attitude when facing resistance or throw their hands up and say “We need price controls and limits on corporate profits."
Economists don’t even know how monetary policy affects inflation if for no other reason than because they can’t predict forward demand and exogenous supply shocks are always random.
This is why nobody called the effects of QE I and II correctly - if you recall it was supposed to cause widespread hyperinflation overnight when it was unwound.
Welp that was totally wrong because the financial system isn’t some deterministic mathematical function. It’s a political and human organization that will twist itself into doing whatever it needs to do to maintain the current power structure - up to and including breaking any rule that Mises, Rothbard or Jefferson could think of that would restrain the use of signoriage as political power.
"if you recall it was supposed to cause widespread hyperinflation overnight when it was unwound"
According to which economists? Did you ignore the economists who vouched for them and said they wouldn't lead to hyperinflation? Regardless, inflation did happen because of QE I and II but it wasn't hyperinflation as many economists predicted beforehand.
Basically the fact that Google, Facebook, Twitter blew up in user growth during the start of QE lead to all the QE money going into startup/tech investments rather than inflating commodities.
Several commenters like yourself have commented on consolidation without giving a clear example. Which consolidations have happened that caused the inflation?
A typical example is a merge underway right now: Kroger and Albertsons are trying to merge. Apparently the CEO of Kroger has been quoted on a call as saying "We view a little bit of inflation as always good in our business." Albertsons is owned by a private equity (PE) firm Cerberus Capital Management. Another example is PE firms buying and merging veterinaries to reduce competition in the market [0]. Yet another example is PE firms buying up over half of the air ambulance Medicare market and jacking up prices [1]. This type of behavior is PE's bread and butter. There are thousands of examples.
In addition to private equity, there are also conflicts of interest from index funds. Institutional investors own over 80% of the S&P 500. Vanguard and BlackRock are the two largest shareholders of a majority of S&P 500 companies. This means BlackRock and Vanguard are the largest shareholder of American and United airlines. Some question whether or not this is also leading to higher prices [2].
Okay, so Kroger and Albertsons have not merged. Why are you blaming current inflation on a merger that doesn't exist?
Those industries you named are far from consolidated. The largest veterinarian (VCA) owns 20% market share. The largest air ambulance one owns 30% (Air Methods). The largest general ambulance service (Envision) owns just 10%.
You don't consider two PE firms controlling 64% of the market to be consolidated? Here is a history of mergers in the air ambulance space [0]:
> In 2010, Bain Capital bought Air Medical Group Holdings for $1 billion, only to sell it five years later for double that amount to KKR, which, in turn, merged the company with yet another air-ambulance provider, American Medical Response, under the name Global Medical Response. (Tracking this shell game can be dizzying. In the three years between Hoechlin’s air-ambulance flight and mine, Guardian Flight merged with REACH Air Medical Services; both are owned by Global Medical Response.) In 2017, American Securities drastically accelerated private equity’s takeover of the air-ambulance industry with its $2.5 billion purchase of Air Methods, the largest domestic provider of air ambulances. (In 2016, during its final year as a publicly traded company, Air Methods posted a $97.9 million profit on $1.17 billion in revenue, and the year before had paid its CEO $2.5 million in direct compensation, including stock options.) That purchase established the industry’s current landscape, in which two private-equity firms, American Securities and KKR, control almost two-thirds of the national market for air ambulances, according to Medicare data.
Also, regarding the vets, JAB bought emergency vet services in specifically target geographic locations to control the market for emergency vet services in those areas. They control a tiny portion of the overall market, but their consolidation still allows for higher prices in the regions they operate in.
Did you read your own article? Kroger and Albertsons have not merged so "inflation" would not apply to this non existent merger. Even if they did merge their market would still be around 10-12% which is far from a monopoly.
I have Costco, Walmart, Safeway, food Co, grocery outlet, and TJs within 5 min of my house. Why are my prices inflated where I live if monopoly is the cause
"In 43 metropolitan areas and 160 smaller markets, Walmart captures 50 percent or more of grocery sales. In 38 of these regions, Walmart’s share of the grocery market is 70 percent or more."
This is such an awful argument. Because a company captures 50% of sales in an area does not mean that it has a monopoly and that there is only 1 grocer in the area. Your source is also not very reliable. List one area where Walmart has a monopoly and the only grocer in town.
A business doesn't need to be the literal only option for it to have monopolistic power over a market.
The Sherman Anti-Trust Act uses 50% market share as a general criteria for when a business could have monopoly power in a market. Based on that definition, here's an answer for your
> List one area where Walmart has a monopoly
Check out the table in the back of the source I linked, and you'll find 203 of them!
You have continually been provided sources and then brushed them off. If those didn’t pique your curiosity to look into it more, and there are more Google results for “Walmart monopoly”, nothing will. Just admit you have an axe to grind and that you won’t change your mind and move on.
That says 4 companies control 65% of the retail market. That is not a monopoly and there are many other grocers that consumers can shop at, like Amazon, Whole Foods, Safeway. Trader Joe's or the many other regional specialty ones.
There were more fuel restrictions for smaller cars after the CAFE amendment of the late aughts. Automakers were incentivized to build bigger cars to get around the restrictions.
Not true. CAFE was amended in the late 2000s to provide more fuel restrictions for smaller cars while keeping the same fuel restrictions for bigger cars. The result is bigger cars being made.
What isn't true? Nothing you said, even if it was true (it's not) contradicts anything in the grandparent post.
> CAFE was amended in the late 2000s to provide more fuel restrictions for smaller cars while keeping the same fuel restrictions for bigger cars.
No, it wasn’t. The footprint model within the passenger car class did differentiate by size, but it didn’t provide more restrictions for smaller cars while keeping larger cars the same.
