In business inflation is a generally neutral factor

[WizardofSoda]

Say your costs went up by 7%, then you just increase your prices by 7%. If you got more customers because more people have money then you add staff and capital. If on the other hand the economy is going down then you layoff people.

I laughed in the face of retards in my state who got a new gas tax put on, which they thought the oil company was going to pay for. The oil companies simply tacked the new tax onto the price of gas + their usual profit margin.

The people said we are going to make the polluters pay, which they thought meant the oil companies. No the oil company isn't the one using the oil to drive around - the people are the ones doing that. Its the people burning the oil. So they pay the tax that they demanded.

 

[CrackingYs]

Seems like starting an oil company is a good business idea. Wonder how you go about doing that.

 

[based_meme]

Seems like starting an oil company is a good business idea. Wonder how you go about doing that.

Have several hundred million dollars in capital ready to go, grease the right palms, kill off the right people, make deals with the right despots, dictators and players in Washington, and bow to the right people and kiss the right hands.

 

[incelerated]

Exactly.

I live in Iran which has had about 1000% inflation in the last decade so I'm very familiar with it.
Not only businesses, specially producers, not lose money but they also gain money. They gain shittons of money.
Because when the prices go up say 4.5%, they're not gonna increase their prices exactly 4.5%. They'll increase them 5% or 6% or 10%. Specially when it gets out of hand like here. So their profit margin keeps increasing.

My own friend has a production workshop with his father and they're getting richer and richer. They don't even know what to do with their money anymore. He said he's losing track of the lands they've bought. And this is in an absolutely brutal economy where wage earners are struggling to survive.

 

[WizardofSoda]

Exactly.

I live in Iran which has had about 1000% inflation in the last decade so I'm very familiar with it.
Not only businesses, specially producers, not lose money but they also gain money. They gain shittons of money.
Because when the prices go up say 4.5%, they're not gonna increase their prices exactly 4.5%. They'll increase them 5% or 6% or 10%. Specially when it gets out of hand like here. So their profit margin keeps increasing.

My own friend has a production workshop with his father and they're getting richer and richer. They don't even know what to do with their money anymore. He said he's losing track of the lands they've bought. And this is in an absolutely brutal economy where wage earners are struggling to survive.

Like in the worst economy the US economy was down 6%. But I pointed out that means 94% of the economy was still there. So your revenues were 6% less than they would have been that year all else being equal.

The whole driver of inflation is that most people have more money than before. If most people had less money and production was the same(or growing over time), then the prices would be falling.

Somebody in Iran has that more money or else the prices wouldn't be going up on the market. As a business you sell to whoever gets the more money. So if everybody in the government is getting big time raises, you sell more to them. If poor people are doing better, you sell more to them.

 

[incelerated]

Like in the worst economy the US economy was down 6%. But I pointed out that means 94% of the economy was still there. So your revenues were 6% less than they would have been that year all else being equal.

The whole driver of inflation is that most people have more money than before. If most people had less money and production was the same(or growing over time), then the prices would be falling.

Somebody in Iran has that more money or else the prices wouldn't be going up on the market. As a business you sell to whoever gets the more money. So if everybody in the government is getting big time raises, you sell more to them. If poor people are doing better, you sell more to them.

In case of Iran it was triggered by the Iranian Rial losing its value. So imports and raw material got more expensive, so the prices went up. People didn't necessarily have money, production simply got way more expensive.
But after that the economy fell into chaos and people just kept raising prices seemingly for no reason. It was like an "inflation rush" so to speak. Everyone wanted to keep ahead of the inflation so they kept raising prices, which led to even more inflation.

 

[WizardofSoda]

In case of Iran it was triggered by the Iranian Rial losing its value. So imports and raw material got more expensive, so the prices went up. People didn't necessarily have money, production simply got way more expensive.
But after that the economy fell into chaos and people just kept raising prices seemingly for no reason. It was like an "inflation rush" so to speak. Everyone wanted to keep ahead of the inflation so they kept raising prices, which led to even more inflation.

Ya that is the other way, if the same money, but less production on the marketplace then the cost has to go up until there is enough demand destruction that the new level of demand matches the lower level of production.

I was trying to explain this with electricity production. If we reduce production, then mathematically somebody will have to use less.. which will mean the poorest and least powerful people.

 

[cvh1991]

Say your costs went up by 7%, then you just increase your prices by 7%. If you got more customers because more people have money then you add staff and capital. If on the other hand the economy is going down then you layoff people.

I laughed in the face of retards in my state who got a new gas tax put on, which they thought the oil company was going to pay for. The oil companies simply tacked the new tax onto the price of gas + their usual profit margin.

The people said we are going to make the polluters pay, which they thought meant the oil companies. No the oil company isn't the one using the oil to drive around - the people are the ones doing that. Its the people burning the oil. So they pay the tax that they demanded.

I have a lot of issues with inflation.

1) companies use inflation to pay their employees less over time then pocket the difference (they raise their prices but keep your wage the same or barely raise it — this is why you have to jump companies constantly to see a pay raise these days, the whole thing is rigged bullshit. Hell, companies fucking love inflation in a lot of cases would be my bet).

2) for normal working joes inflation totally fucks your savings. The wealthy don’t care because they have their money in investments or a home that scale with inflation better.

A balanced government budget matters because the alternative is huge interest payments that require ever more taxes or inflation to cover and inflation is just an invisible tax on your citizens.

But retard politicians would rather kick the can down the road, they don’t give a fuck about anyone but themselves. Also, don’t get me wrong I generally agree with some lefty points of view, but holy fuck most lefties are dumber than a sack of rocks — have y’all been on Reddit and Twitter lately? Good lord, they think men are women, they don’t understand the English language (the function of pronouns/what gender means), they can’t comprehend finance, they have no sense of consequences when they do something mentally retarded, they don’t believe in borders or see how some cultures are terrible compared to others, it’s just unbelievable how stupid lefties are and what makes it worse is they’re usually hypocrites has been my observation. Rant over, Reddit will make any sane man want to nuke the left from orbit.