Reply to U.S. Annual Inflation rose to 6.8% in November

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Reply to "U.S. Annual Inflation rose to 6.8% in November - the highest in 40 years"

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[quote=Anonymous][quote=Anonymous][quote=Anonymous][quote=Anonymous][quote=Anonymous]bUt InFlAtIoN

[twitter]https://twitter.com/DanPriceSeattle/status/1491968731278458880[/twitter][/quote]

All of these companies had record low profits in 2020.[/quote]

There was very low demand for gas in 2020 because of COVID.
We didn't have 6.8% inflation in 2020
Gas prices is now one of the top things contributing to inflation.
Gas companies jacked costs up to greedily boost their profits and it's cascaded into cost increases in other sectors.
Our inflation crisis is being manufactured, by the private sector.[/quote]

Accusations of price gouging are ridiculous. Nobody was saying this when oil was negative in 2020.

Oil and gas is an incredibly capital intensive industry. When demand falls, you cannot quickly just shut down say, the Permian Basin, in a day. That's why the price for oil dropped negative for a short period of time in 2020. There's still a risk for another dramatic drop in demand (a new COVID variant), risk of war with a major oil producer (Russia), and risk of rising interest rates (oil and gas companies need loans to maintain their capital intensive industry). Companies need to price in this risk somehow.

[/quote]

Chicken pricing started going up when Biden extended the extreme unemployment checks.  The chicken processing plants are competing against the governments free money for workers.  If the government pays people to stay home then the price to work as a chicken processor rises.  Prior to Covid the chicken processing plants on Delmarva were paying $12 - $15 per hour to process your chicken.  Due to government policies implemented during Covid the chicken processing companies now are paying $18 - $20 per hour to work in the factories for unskilled labor to process your chicken.

Poorly implemented government policy has a significant effect on inflation.

The farmers on Delmarva can keep up with your demand for chicken. The bottleneck is keeping factory workers on the factory floor to process your chicken.  If there is not enough factory workers then chickens in the chicken get euthanized.  This is costly to the farmers and to the banks who lend to the farmers.  It is another factor driving up the price of your chickens.[/quote]

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