Two inflation Indicators: Corporate greed and mortgage rates

Planet Money

NPR

Business, News

4.6 • 29.8K Ratings

🗓️ 24 March 2022

⏱️ 18 minutes

🔗️ Recording | iTunes | RSS

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Summary

Corporate profits are soaring. So are prices. Can corporations just not raise prices? Would that fight inflation? We examine this theory making the rounds. Then, we go inside the pipes of the economy to see how mortgage rates connect to that recent rate hike by the Federal Reserve. | Subscribe to our sister podcast, The Indicator from Planet Money. It's daily, and always less than 10 minutes.

Transcript

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0:00.0	This is Planet Money from NPR.
0:03.4	Here's a question that we've been getting in the Planet Money inbox, which by the way,
0:10.1	we do read, so please keep them coming.
0:12.4	The question goes like this, can we blame inflation on corporate greed?
0:17.5	Or another version of the question, corporations are making huge profits, and so why do they
0:22.6	need to raise prices?
0:23.9	Can they just not do that?
0:25.4	Sure.
0:26.4	Corporations have always charged more when they could, when people would keep buying, so
0:30.7	why would greed lead to inflation now?
0:34.2	Prices are up at the pump, at the supermarket, and online.
0:38.0	Senator Elizabeth Warren is particularly vocal about this.
0:40.8	Here she is speaking at a Senate subcommittee in December.
0:43.7	One reason for this price gouging is that fewer and fewer markets in America are truly competitive.
0:50.7	Markets are less competitive.
0:53.0	More and more companies have tried to merge into bigger companies over the last couple of
0:56.7	years.
0:57.7	Corporate profits have had these 70 year highs, and inflation is at 40 year highs.
1:02.7	So is this all connected?
1:04.7	Hello and welcome to Planet Money, I'm Daring Woods, co-host of Planet Money's shorter,
1:09.4	daily podcast, The Indicator.
1:11.5	We've got two indicators for you today.
	...

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