EPTEdit: The share price has fallen to $88...
Trading/Investing Thread - Page 117
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{CC}StealthBlue
United States41117 Posts
Edit: The share price has fallen to $88... | ||
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SC-Shield
Bulgaria846 Posts
 We'll see tomorrow but considering that Tesla recovered somewhat after earnings, I don't expect Apple to stay down for long. | ||
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JimmiC
Canada22817 Posts
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yenm
1 Post
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Vivax
22341 Posts
This wasn't good last time it happened :D Observation, not advice. | ||
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{CC}StealthBlue
United States41117 Posts
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SC-Shield
Bulgaria846 Posts
On November 04 2022 22:04 {CC}StealthBlue wrote: JPowell has got to be pissed. The US revised it's jobs added to over 300k. He will keep raising rates till something breaks and so far nothing has. Whether it be real estate, manufacturing or w/e. You paint him as an evil man, I think he is trying to reduce inflation. Problem is I think inflation is caused by war and subsequent energy crisis. I don't know if rising interest rates helps in this case but more knowledgeable people with financial education are working on this issue, so hopefully they succeed to do it as soon as possible. | ||
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RvB
Netherlands6277 Posts
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Jealous
10324 Posts
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mahrgell
Germany3943 Posts
On November 06 2022 02:08 Jealous wrote: It's absurd to think that a $1600 check over a year ago is the reason for inflation. Corporate profits and greed are driving inflation. Corporate profits are higher than they have been in 70 years, income disparity is greater than it ever has been, and you want to blame COVID stimulus checks? LOL Because surely he was talking about those meaningless 1600$ and not about the countless trillion pumped into the bond/stock market... | ||
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Jealous
10324 Posts
On November 06 2022 03:33 mahrgell wrote: Because surely he was talking about those meaningless 1600$ and not about the countless trillion pumped into the bond/stock market... Ah ok, that would make sense then. I hear people complain about "stimulus" I think of conservative nutjobs who complained about those checks. | ||
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RvB
Netherlands6277 Posts
Corporate profits do not explain inflation. Corporations are profit-maximizing institutions but they were profit-maximizing before covid as well so something else has had to change to explain a rapid change in inflation. Corporate profits in the US as a share of GDP moved opposite of what you would expect if they caused inflation. Corporate profits went up during the covid crisis and are now back at the level of 2018 but inflation is still very high. https://fred.stlouisfed.org/graph/?g=KwRP | ||
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SC-Shield
Bulgaria846 Posts
Just my view, I don't have financial education. | ||
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RvB
Netherlands6277 Posts
On November 06 2022 17:28 SC-Shield wrote: Maybe COVID stimulus has an effect but I still believe it's mostly due to energy crisis right now. If gas and oil are more expensive, that makes logistics more expensive which in turn means every import is more expensive (food, new TV, new chip, etc). When you raise interest rate in the US, then import in EU costs more due to stronger dollar. Just my view, I don't have financial education. Yes that's what a supply shock is. A sudden drastic change of the supply of a certain good. In this case oil and gas but also due to the continued lockdowns in China. But even core inflation (excluding energy and food) is very high (around 6% in both the US and EU). | ||
KwarK
United States44020 Posts
On November 06 2022 16:47 RvB wrote: Corporate profits do not explain inflation. Corporations are profit-maximizing institutions but they were profit-maximizing before covid as well so something else has had to change to explain a rapid change in inflation. Let’s say oil costs $100/barrel and there’s enough oil for everyone. They’ll sell petrol at a competitive margin and make, say, 20% profit. Now let’s say oil costs $100/barrel but there’s not enough for everyone. Now we have to price consumers out of an inelastic commodity to decide who goes without. Someone is going to need to take the bus or car pool or bike because there isn’t a just not enough for everyone and in capitalism we find out who needs it least by finding out who won’t pay for it. Now the profit margins go to 100%. Supply shock. Inelastic demand. Within capitalism the way we encourage extra production during a supply shock is to make everyone currently producing a resource absurdly rich. You can't handwave "corporations are always greedy and therefore margins must be static", margins are never static. | ||
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iPlaY.NettleS
Australia4420 Posts
On November 06 2022 17:28 SC-Shield wrote: Maybe COVID stimulus has an effect but I still believe it's mostly due to energy crisis right now. If gas and oil are more expensive, that makes logistics more expensive which in turn means every import is more expensive (food, new TV, new chip, etc). When you raise interest rate in the US, then import in EU costs more due to stronger dollar. Just my view, I don't have financial education. Yes, and the EU ban on Russian crude imports is due less than a month away on Dec 5.Total ban on all Russian oil products from Feb, so the potential is for the situation (in Europe) to get worse from here. All you will see is more companies shifting manufacturing from Europe and moving it to Asia and USA due to supply and cost issues surrounding energy in Europe. This has already been widely reported in the press, here is one from late October. https://www.reuters.com/markets/europe/basf-says-european-operations-need-be-cut-size-permanently-2022-10-26/ FRANKFURT, Oct 26 (Reuters) - BASF (BASFn.DE) said costs at its European sites must be cut to a "permanently" smaller size because of a triple burden of sluggish growth, high energy costs and over-regulation, with the German industrial giant's boss throwing his weight behind a planned expansion in China. "These challenging framework conditions in Europe endanger the international competitiveness of European producers and force us to adapt our cost structures as quickly as possible and also permanently," the chemical maker's CEO Martin Brudermueller said in a statement on Wednesday. | ||
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RvB
Netherlands6277 Posts
On November 06 2022 23:39 KwarK wrote: Let’s say oil costs $100/barrel and there’s enough oil for everyone. They’ll sell petrol at a competitive margin and make, say, 20% profit. Now let’s say oil costs $100/barrel but there’s not enough for everyone. Now we have to price consumers out of an inelastic commodity to decide who goes without. Someone is going to need to take the bus or car pool or bike because there isn’t a just not enough for everyone and in capitalism we find out who needs it least by finding out who won’t pay for it. Now the profit margins go to 100%. Supply shock. Inelastic demand. Within capitalism the way we encourage extra production during a supply shock is to make everyone currently producing a resource absurdly rich. You can't handwave "corporations are always greedy and therefore margins must be static", margins are never static. I did not say margins are static. The initial claim is that corporate profits drive inflation. Inflation is a broad increase in the prices of goods and services so I looked at the economy in aggregate. Your example is about one specific sector. If total corporate profits stay the same (or go down as we see in the graph I linked) and the oil sector takes an increasing share of the profits then other sectors will see a decrease. If profits drive inflation then the increase in inflation caused by the rise in profits of the oil firms is cancelled out by the decrease in relative profits of other sectors but that is not what we see in practise. Even in your example the cause of inflation is the reduction in supply. Because companies are profit-maximizing they will increase their price. The only alternative is that we cap the price but then there will be shortages. | ||
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KwarK
United States44020 Posts
On November 07 2022 15:57 RvB wrote: I did not say margins are static. The initial claim is that corporate profits drive inflation. Inflation is a broad increase in the prices of goods and services so I looked at the economy in aggregate. Your example is about one specific sector. If total corporate profits stay the same (or go down as we see in the graph I linked) and the oil sector takes an increasing share of the profits then other sectors will see a decrease. If profits drive inflation then the increase in inflation caused by the rise in profits of the oil firms is cancelled out by the decrease in relative profits of other sectors but that is not what we see in practise. Even in your example the cause of inflation is the reduction in supply. Because companies are profit-maximizing they will increase their price. The only alternative is that we cap the price but then there will be shortages. When demand exceeds supply corporations respond in the short term by increasing margins to reduce demand. They could choose to keep the price the same and let the shelves empty of product as consumers rush to buy the limited available product. They choose not to because profit maximization is a fundamental tenet of corporate greed. When people blame corporate greed for increased prices it is this that they are describing. | ||
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RvB
Netherlands6277 Posts
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SC-Shield
Bulgaria846 Posts
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