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New York CNN —Some progressives have frequently blamed corporate greed for fueling the high cost of living that Americans are fed up with. That’s corporate greed. That’s corporate greed. Although the paper did not directly mention corporate greed, shrinkflation or Biden, the research undercuts the argument that greedflation drove the early inflation. That report found corporate profits were to blame for 34% of inflation since the start of Covid-19.
Persons: Sen, Elizabeth Warren, ” Warren, “ That’s, It’s, , , Joe Biden, ” Biden, CNN’s Erin Burnett, Biden, – we’re, shrinkflation, greedflation, Jeremy Edwards, ” Edwards, , , Greg Valliere, ” Valliere, Jerome Powell, Caroline Ciccone, profiteer Organizations: New, New York CNN, Federal Reserve Bank of San Francisco, Fed, SF Fed, , CNN, White, AGF Investments, Federal Reserve, Federal, Federal Reserve Bank of Kansas City Locations: New York, America, Kansas
About 45% of changes to S&P 500 analysts' earnings estimates are upgrades, as shown in the chart below, down from 50% in early 2023. AdvertisementSociete GeneraleHistorically, analyst optimism has been a good indicator for the economy's direction. Below is the S&P 500's year-over-year percentage change along with the analyst optimism measure. He says the S&P 500 is in a bubble fueled by AI optimism and could fall as much as around 60%. He sees potential downside of 39% for the S&P 500.
Persons: , Albert Edwards, Edwards, Powell's, Ed Yardeni, Let's, There's, Jeremy Grantham, David Rosenberg, Merrill Lynch Organizations: Service, Societe Generale, Business, Street, Nasdaq, Generale, Conference, Institute for Supply, subsiding, Fed, repo, Bureau of Labor Statistics, Bears, Rosenberg Research, policymaking
After-tax profits hit a record high of $2.8 trillion in the fourth quarter, per the Commerce Department. "The gangbuster gain in profits helps explain why businesses have been able and willing to hold the line on layoffs, which was key to avoiding recession," he said. Advertisement"It also helps explain the record stock market, and the resulting positive wealth effects and resilient consumer spending." Related storiesAs for stocks, they're generally valued at a multiple to company profits so they've hit record highs too. That has made stockholders feel wealthier and more comfortable spending, Zandi said.
Persons: , Mark Zandi, That's, Zandi Organizations: Service, Corporate America, Corporations, Commerce Department, Business, Federal Reserve, Companies
In short, the rent is too damn high — and it’s keeping inflation and interest rates elevated alongside it. We’ll see if they’re right on Tuesday morning when February’s CPI data is due out. “Shelter inflation has been a big focal point for the market,” they wrote in a note on Monday. “We remain confident that [rent prices] will flatline in 2024, rather than fall,” Capital Economics analyst Thomas Ryan wrote in a recent note. That means a current deceleration in rent prices won’t be fully factored into inflation data until February 2025.
Persons: Greg McBride, , Jerome Powell, “ It’s, Powell, aren’t, , Thomas Ryan, Ritti Singh, Singh, won’t, isn’t, Goldman Sachs, Clare Duffy, Reddit, it’s, That’s, Matt Egan, Joe Biden, Bespoke’s Paul Hickey, ” Hickey Organizations: CNN Business, Bell, New York CNN, Federal Reserve, CPI, Bank of America, ” Capital, Housing Justice, Fed, Dallas Fed, AAA, Federal, Investment Locations: New York
Washington, DC CNN —Cookie Monster has taken a stance on a very real and controversial trend in the US economy — and he hates it. Me cookies are getting smaller,” Cookie Monster wrote. “Household paper products, like toilet paper and paper towels, are 34.9 percent more expensive per unit than they were in January 2019. The latest Consumer Price Index showed that inflation didn’t ease in January as much as Wall Street was expecting. Americans’ attitudes toward the economy have improved recently, thanks to slowing inflation, according to consumer surveys, but remain below levels seen before the Covid-19 pandemic.
Persons: , “ Guess, Democratic Sen, Bob Casey, It’s, Sherrod Brown, Cookie, , Joe Biden, Biden, shrinkflation, ” Biden, Casey, Jerome Powell, Powell Organizations: DC CNN, Democratic, Labor Department, Research, of, Federal Trade Commission, Fed Locations: Washington, Ohio
Corporate greed drove inflation higher in January, according to Fundstrat's Tom Lee. AdvertisementCorporate greed is the reason why inflation was hotter than expected to start the year, according to Fundstrat's head of research Tom Lee. Speaking to CNBC on Friday, Lee pointed to the slight uptick in January consumer inflation, with prices rising 3.1% year-over-year. That suggests the hotter-than-expected inflation reading to start 2024 was likely due to corporate "greedflation," or simply, businesses hiking prices because they're able to. Advertisement"The arching reality is that inflation is falling ... A lot of companies raise prices in the month of January and it doesn't get captured," Lee said.
Persons: Tom Lee, Lee, , doesn't Organizations: Service, CNBC, Federal Reserve
For example, she said a Valentine’s Day-themed heart-shaped box of Sour Patch Kids candy (3.45 oz) was listed on Walmart.com for $3.96 ($1.15 oz), while a regular box of the candy (3.5 oz) costs $1.24 ($0.35/oz). Walmart said it was looking into the price differences, but said some of the Valentine’s Day candy items on its website are listed by third-party sellers on Walmart marketplace. A Walmart supercenter in New Jersey visted by CNN also had the heart-shaped Sour Patch Kids candy box for $3.96 on the shelf. Some Sour Patch Kids Valentine's Day editions cost much more than the regular versions of the candy for roughly the same quantity. “Buy the candy after Valentine’s Day when it’s heavily discounted or buy the regular cheaper version of the candy and package it yourself,” he said.
Persons: don’t, Jolly, Veronica Fletcher, Fletcher, Goldbears, , Edgar Dworsky, , John Talbott, ” Talbott, it’s Organizations: New, New York CNN, Walmart, Bears, CNN, New Jersey visted, CVS, Center for Education, Research, Indiana University’s Kelley School of Business Locations: New York, New York City, New Jersey, Massachusetts, Retail
That has prompted President Joe Biden to repeatedly ask his advisers: Why then are so many Americans still not feeling great about the economy? While inflation has eased in recent months, prices on most goods are still higher than they were in the spring of 2021. Still, Biden’s economic advisers are increasingly telling the president in private that they feel optimistic about the direction things are headed. Historic-high prices that plagued the first few years of the Biden administration continue to moderate, all while economic growth is outpacing expectations. If those trend lines continue, they have cautiously told Biden, consumer sentiment, too, should begin to course-correct.
Persons: Joe Biden, Inflation, Biden, ‘ Sir, we’ll, , , SSRS, Donald Trump, , ” Biden, – we’re, – Sen, Bob Casey of, greedflation Organizations: Washington CNN, CNN, White, University of Michigan, Conference Board, New York Times, UBS Global Wealth Management Locations: Columbia , South Carolina, America, Bob Casey of Pennsylvania, Las Vegas, American
Biden Takes Aim at Grocery Chains Over Food Prices
  + stars: | 2024-02-01 | by ( Jim Tankersley | ) www.nytimes.com   time to read: +1 min
President Biden, whose approval rating has suffered amid high inflation, is beginning to pressure large grocery chains to slash food prices for American consumers, accusing the stores of reaping excess profits and ripping off shoppers. “There are still too many corporations in America ripping people off: price gouging, junk fees, greedflation, shrinkflation,” Mr. Biden said last week in South Carolina. Aides say those comments are a preview of more pressure to come against grocery chains and other companies that are maintaining higher-than-usual profit margins after a period of rapid price growth. Mr. Biden’s public offensive reflects the political reality that, while inflation is moderating, voters are angry about how much they are paying at the grocery store and that is weighing on Mr. Biden’s approval rating ahead of the 2024 election. Those prices jumped by more than 11 percent in 2022 and by 5 percent last year, amid a post-pandemic inflation surge that was the nation’s fastest burst of price increases in four decades.
Persons: Biden, Mr Locations: America, South Carolina
Read previewCompanies across the board have been hiking prices massively in the last few years, citing relentless supply chain disruptions from the COVID-19 pandemic, geopolitical tensions, and Russia's war in Ukraine. Speaking to Reuters at the World Economic Forum in Davos, Switzerland, Broden acknowledged "quite significant deflation" upstream in its supply chain. AdvertisementIkea also has enough inventory to offset price hikes from any supply chain shocks, Brodin told the news agency. To be sure, Ikea hiked prices in 2022, citing supply chain bottlenecks and higher raw material costs, but the furniture giant started cutting price late last year, citing easing price pressures. US grocery giant Walmart signaled deflation in November as well — but that was before the Red Sea Houthi attacks dragged into the new year.
Persons: , Jesper Brodin, Broden, Brodin, It's Organizations: Service, Business, Ingka, Ikea, Reuters, Red, Economic, Energy Locations: Ukraine, Davos, Switzerland, London, Russia
download the appSign up to get the inside scoop on today’s biggest stories in markets, tech, and business — delivered daily. Read previewInvestors are underestimating the risk of an economic slowdown, and "greedflation" among companies can't prop up the market any longer, Société Générale said in a note this week. Firms hiking prices likely helped avoid a deeper slump in profits stemming from a slowing economy, Société Générale strategist Albert Edwards said. "The Greedflation driven surge in margins helped stop the profits slowdown turning into a deep downturn. A recession still poses a decent risk to the economy, though investors have warmed up to the prospect of a soft-landing.
Persons: , Société Générale, they're, Société, Albert Edwards, Greedflation, Edwards, , Evercore, quant, Andrew Lapthorne, David Rosenberg Organizations: Service, Business, Bureau of Labor Statistics, Federal Reserve, New, Fed, Institute of Supply, Evercore ISI
Social media’s antisemitism problemThe rise in antisemitism since the outbreak of war in the Middle East has ignited a clash between Wall Street donors and universities, and divided some workplaces. Now, the pressure is building on social media platforms, particularly Elon Musk’s X and TikTok, with advertisers, celebrities and influencers pulling spending and confronting executives about the proliferation of hate speech. He posted to X his support for white nationalist conspiracy theories that Jewish communities were spreading hatred. Yaccarino was brought in to win back advertisers after Musk bought Twitter last year and culled many content moderators. More than a dozen Jewish celebrities and creators, including the actors Sacha Baron Cohen, Debra Messing and Amy Schumer, confronted TikTok executives this week.
Persons: Elon Musk’s, Adolf Hitler, Musk, X’s, Linda Yaccarino, Yaccarino, “ Linda, ” Martin Sorrell, DealBook, TikTok, Sacha Baron Cohen, Debra Messing, Amy Schumer, “ Hitler, Anne Frank ”, Cohen, , Osama bin, bin Laden, , Alex Haurek, George Santos, Biden, Xi Jinping, Doug McMillon, Walmart’s, , ” Brian Cornell, Organizations: IBM, Media, America, Nazi Party, Apple, Oracle, Defamation League, Twitter, S4 Capital, House, Big, General Motors, Hyundai, Republican, Justice Department, Business, APEC, West Texas Intermediate, Consumers, Depot, Walmart Locations: TikTok, New York, Hong Kong, China, San Francisco, Beijing, Washington, U.S
‘AI’ is Collins Dictionary’s word of the year
  + stars: | 2023-11-01 | by ( Jack Guy | ) edition.cnn.com   time to read: +2 min
London CNN —Collins Dictionary has named “AI” as its word of the year, defining it as an “abbreviation for artificial intelligence: the modelling of human mental functions by computer programs.”“Considered to be the next great technological revolution, AI has seen rapid development and has been much talked about in 2023,” the UK-based dictionary publisher said in a statement announcing its decision. While AI’s capabilities in mimicking human speech fascinated people at first, they were also the source of some anxiety, according to Collins. “If computers were suddenly experts in that most human of domains, language, what next? Cue an explosion of debate, scrutiny, and prediction, and more than enough justification for Collins’ 2023 Word of the Year: AI,” the statement continues. The inaugural Global AI Summit on AI Safety got underway in the United Kingdom Wednesday.
Persons: London CNN —, ” “, Collins, Rishi Sunak, Kamala Harris, , , “ semaglutide Organizations: London CNN, London CNN — Collins, Global, Safety, UK, Allied Forces codebreaking, US Locations: United, Bletchley,
A customer is seen inside an Albert Heijn shop, operated by Ahold Delhaize, the Dutch-Belgian supermarket operator, in Eindhoven, Netherlands, January 23, 2019. In this Exchange podcast, Ahold Delhaize CEO Frans Muller explains why demand for own-brand goods gives the Dutch group an upper hand in supplier negotiations. Listen to the podcastFollow @aimeedonnellan on XSubscribe to Breakingviews’ podcasts, Viewsroom and The Exchange. Editing by Oliver TaslicOur Standards: The Thomson Reuters Trust Principles. They do not reflect the views of Reuters News, which, under the Trust Principles, is committed to integrity, independence, and freedom from bias.
Persons: Albert Heijn, Ahold Delhaize, Eva Plevier, Ahold, Frans Muller, Oliver Taslic Organizations: REUTERS, Reuters, Thomson Locations: Dutch, Belgian, Eindhoven, Netherlands
Americans can't get a break financially, largely thanks to higher interest rates and "greedflation." The US economy may be in good shape, but Americans are getting squeezed from all sides. On top of that, it's become more expensive to pay back debt in a world of higher interest rates. US mortgage rate are at 23-year highsHigher interest rates influence mortgage rates. Mortgage rates tend to fluctuate with 10-year Treasury yields, given lenders typically tie rates to the yield of the 10-year bond.
Persons: it's, Freddie Mac, Fitch, Larry McDonald, Paul Krugman, That's Organizations: Morning, Federal Reserve, U.S, AAA, Brent, West Texas Intermediate Locations: Ukraine, Saudi Arabia, Russia
Inflation is cooling, but food prices remain stubbornly high, led by typical school lunch supplies. Groceries like bread, ham, lettuce, condiments, apples, and juice cost up to 15% more than last year. The lunchbox price increases are even more striking when compared against 2020: Bread prices alone have risen nearly 30%. That has sent wheat prices higher, which in turn raises prices that consumers pay, economist Paul Krugman noted. At the same time, many reported increased profits, a sign that the higher prices weren't always about offsetting higher costs for inputs like ingredients and labor.
Persons: Paul Krugman, Nestle Organizations: Service, US Bureau of Labor Statistics Locations: Wall, Silicon, Ukraine
Food inflation has mostly been brought on by Russia, top economist Paul Krugman said. The Nobel laureate pointed to accelerating food prices over the past year, with the Food and Agriculture Organization's Food Price Index rising to 123.9 in July. But the primary driver of "foodflation" exists outside of the US -- and lies largely in the hands of Russia, Krugman argues. Russia's invasion of Ukraine also spiked fertilizer prices, as the nation is one of the world's largest exporter of fertilizer. Still, Russia's impact is still "at the top of the list" for culprits driving food inflation.
Persons: Paul Krugman, Vladimir Putin, Krugman, Biden, That's, Putin Organizations: Service, Soaring, Food, Agriculture, That's, Observers, Cleveland Fed Locations: Russia, Ukraine, Wall, Silicon, Kazakhstan, Odesa, Europe
Despite solid economic data, some Wall Street strategists are sticking with their gloomy outlook for the economy and stocks. But don't count out a decline just yet: "People give up on recession just as it arrives." Get the inside scoop on today’s biggest stories in business, from Wall Street to Silicon Valley — delivered daily. Société GénéraleEdwards isn't the only bear on Wall Street. And as Edwards highlighted, a decline in profits usually leads to an uptick in layoffs, which could ultimately hurl this economy into a recession.
Persons: Albert Edwards, Greedflation, Edwards, Société Générale Edwards, JPMorgan's Marko Kolanovic, Kolanovic, Morgan Stanley's Mike Wilson, Wilson Organizations: Service, Survey, Loan, Fed Locations: Wall, Silicon
But major food companies, from Nestlé to Unilever, increased prices much more than that. The world's biggest food companies spent the first half of this year raising prices, according to several earnings reports released this week. Some external factors have impacted the costs that major food companies pay to produce their products. It's especially easy for global food companies to raise prices, given that a few companies own most of the brands in many US grocery stores. But there's some evidence that consumers aren't willing to put up with higher food prices indefinitely.
Persons: PepsiCo's, Ramon Laguarta, We've, James Quincey, Quincey, PepsiCo's Laguarta Organizations: Consumer, Unilever, Service, PepsiCo, Quaker Oats, Gatorade, Federal Reserve, New York Times, Walmart, Costco, Sam's Locations: Nestlé, Wall, Silicon, Ukraine, Clorox, Kingsford, Europe
The Federal Reserve has made three big mistakes since inflation took off in 2021, according to UBS. "Today's rate hike will probably have to be reversed in a relatively short space of time," UBS said. Today's additional rate hike from the Fed gets to the root of what has went wrong. These are the three big mistakes made by the Fed over the past two years, and how it will impact the economy, according to UBS. "A sensible recognition of the declining quality of economic data would have stopped the blind hike, hike, hike strategy."
Persons: Paul Donovan, Donovan, Jerome Powell, Powell Organizations: Federal, UBS, UBS Global Wealth Management's, Fed Locations: Ukraine
When companies’ input costs go up for some reason, the prices they charge their customers go up like a rocket. The example most of us can relate to is the retail price of gasoline. At least in the feather scenario, retail prices do go down. Rines said he coined the term “price over volume” in June 2022 to describe how companies were fighting higher costs at the time. “If you’re profit-maximizing you’re going to do that and you should do that,” he told me.
Persons: Samuel Rines, Rines, Organizations: Locations: U.S, Houston
Consumer goods makers say the price hikes are necessary, and that they have taken a hit to margins over the past two years. Some companies such as Clorox (CLX.N) have even begun to ease off the hikes to protect sales volumes as input costs fall. "In the U.S. in particular, these pressures are more acute than in Europe," Janus Henderson portfolio manager Luke Newman told Reuters. U.S. consumer strength has begun weakening, "and that's bad news for the consumer companies," Barclays analyst Iain Simpson said. Still, cost inflation has chipped away at margins, which have broadly fallen 2-4 percentage points over the past two years for the consumer goods industry.
Persons: Janus Henderson, Luke Newman, Newman, Richard Marwood, Robert Klaber, Parnassus, Iain Simpson, Alvarez, Marsal, David Chavern, Stephanie Niven, Niven, Irene Jensen, Jensen, Thomas Joekel, Richa Naidu, Jessica DiNapoli, Matt Scuffham, Deepa Babington Organizations: U.S, Consumer, Reuters, Royal London Asset Management, Investments, Biden, Barclays, Procter, Gamble, Consumer Brands Association, Sustainable Equity Fund, Norges Bank Investment Management, Unilever, Reckitt, Investment, Thomson Locations: Ukraine, U.S, Europe, San Francisco, United States
Former BoE policymaker Kate Barker told the Financial Times this weekend that targetted and temporary tax rises on top earners may be the most effective and fairest way to go. "We're asking monetary policy to do all the work," she said. But the political sensitivity of income tax likely dictates the way forward, however cogent the economics. Yet the more general point of fiscal policy helping with the final throes of the inflation battle continues to be made. "Fiscal Policy should remain aligned with monetary policy in the fight against inflation," the Fund concluded.
Persons: BoE policymaker Kate Barker, President Biden, Mike Dolan, Matthew Lewis Organizations: International Monetary Fund, Bank for International, U.S, Bank of, Financial Times, Fed, U.S . Bureau of Labor Statistics, Britain's, National Statistics, Reuters Graphics Reuters, Reuters, Republicans, Twitter, Thomson Locations: Britain, London
Drew Angerer | Getty Images News | Getty ImagesCentral banks are at "the end of the beginning" in their battle against inflation, as several factors keep core prices persistently high, according to top Societe Generale economist Kokou Agbo-Bloua. U.S. inflation cooled in May to an annual 4%, its lowest annual rate in more than two years, but core inflation rose by 0.4% month-on-month and 5.3% year-on-year. In assessing the current state of global policymakers' efforts to tame inflation, Agbo-Bloua quoted former British Prime Minister Winston Churchill's remarks in a 1942 speech: "Now this is not the end. It is not even the beginning of the end. He suggested that this has helped to keep the labor market resilient, which will likely extend this lag time.
Persons: Jerome Powell, Drew Angerer, Kokou Agbo, Bloua, Winston Churchill's, we're Organizations: Federal Reserve, Federal, Market, Getty, Societe Generale, British, CNBC Locations: Washington ,, Ukraine, Agbo
As Greedflation Starts to Fade, Wageflation Creeps In
  + stars: | 2023-07-06 | by ( Greg Ip | ) www.wsj.com   time to read: 1 min
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Persons: Dow Jones
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