Biden Takes Aim at Grocery Chains Over Food Prices
Biden Takes Aim at Grocery Chains Over Food Prices

Biden Takes Aim at Grocery Chains Over Food Prices

Biden Takes Aim at Grocery Chains Over Food Prices
Biden Takes Aim at Grocery Chains Over Food Prices
The problem is the way the system is rigged.
Kroger is a publicly traded company, their stock price right now is 46.71 / share.
You can see their most recent earnings report here:
Operating Profit of $912 million; EPS of $0.88
Now then... for NEXT quarter... It doesn't matter if they are profitable or not. Because they are publicly traded, they are going to be expected to make MORE profit than they did this quarter.
Let's say next quarter they "only" have $890 million in profit... Most of us would KILL to be that profitable.
The stock market analysts will look at it and go "yeah, but you 'lost' $22 million from last quarter..." and they will punish Kroger for failing.
Even worse...
Let's say Kroger raised their prices and pulls in a profit of $915 million next quarter... they can STILL get punished if the market goes "Yeah, but our analysts expected you to bring in $921 million in profit."
Failing to meet or beat "expectations" is just as bad as raking in less of a profit than last time.
So prices go up, because they have to make more money than the same time last month, last quarter, last year.
abolish the stock market. put these hogs on a fucking island with no natural resources but sand and salt water. set up a camera and let us watch.
It's interesting how recent the stock market really is:
https://www.sofi.com/learn/content/history-of-the-stock-market/
"The first modern stock trading market was created in Amsterdam when the Dutch East India Company was the first publicly traded company. To raise capital, the company decided to sell stock and pay dividends of the shares to investors. Then in 1611, the Amsterdam stock exchange was created. For many years, the only trading activity on the exchange was trading shares of the Dutch East India Company.
At this point, other countries began creating similar companies, and buying shares of stock was popular for investors. The excitement blinded most investors and they bought into any company that began available without investigating the organization. This resulted in financial instability, and eventually in 1720, investors became fearful and tried to sell all their shares in a hurry. No one was buying however, so the market crashed.
. . .
Although the first stock market began in Amsterdam in 1611, the U.S. didn’t get into the stock market game until the late 1700s. It was then that a small group of merchants made the Buttonwood Tree Agreement. This group of men met daily to buy and sell stocks and bonds, which became the origin of what we know today as the New York Stock Exchange (NYSE).
Although the Buttonwood traders are considered the inventors of the largest stock exchange in America, the Philadelphia Stock Exchange was America’s first stock exchange. Founded in 1790, the Philadelphia Stock Exchange had a profound impact on the city’s place in the global economy, including helping spur the development of the U.S.’s financial sectors and its expansion west."
The problem is that a bunch of the hogs are our retirement funds.
We need to remove the middle-men from the equation and institute guaranteed basic income before we can change it.
It did serve a purpose. But like all money and corporation things we've let the wealthy run away with it.
You should absolutely not abolish the stock market because it's the single way most average people have to becoming wealthy. What you should do is change how it operates. Here's a novel idea I've had for a long time.
Make more and more companies worker co-ops going forward by incentivizing them the attacks credits and local government health in getting them started. Preserve 75% of the company for the people who actually work there which is what makes it a worker's co-op.
Reserve 25% of the company for speculation on Wall Street and to raise capital if they need to.
This way you can have sort of a socialist economy that avoids abuses and a stock market at the same time that provides liquidity and efficiency.
they can STILL get punished if the market goes "Yeah, but our analysts expected you to bring in $921 million in profit."
This happened to the company I'm in. We had record profits, were positive for the first time in years, and beat our goals by a decent bit. Stock prices tanked anyway because "the best we've ever done" wasn't good enough for the shareholders.
The "expectations" aspect became especially apparent when Tesla was valued higher than the next top 10 auto manufacturers combined.
It was literally that Tesla is new shit that we can bet on. It has nothing to do with Tesla's actual value.
It's also the issue with buying stocks based on a company's performance. If you do that, you're already too late because investors with more information have already bought based on a prediction of that performance (or insider information).
That was just people chasing fomo and the "greater fool". Basically some people are dumb and don't want to miss out. Other people know the company is crappy but think they can sell to a dummy at a higher price. Eventually people think "it's different this time" and pay way too much money. Last dummies are left holding the bag.
Exactly what's happening with Bitcoin and all other cryptocurrencies. There's no value attached to the currency besides hype, which eventually fades. The USD is reliable because the US government only accepts it as payment for taxes. You need it. No one important accepts only Bitcoin. So you don't need it.
I always imagine the stockholder that trades off quarterly expectations to be someone sitting in an overly large home getting all bent out of shape because someone else's labor didn't make them enough money RIGHT NOW!
It isn't one guy adjusting one portfolio relative to a single quarterly change in profits. You have to look at this as thousands of hedge funds with tens of billions of dollars in investor cash comparing Kroger to Safeway and Walmart and saying "I want 8% exposure to the cyclical consumer retail sector and I have $X-Billion to invest, how much of that do I want to distribute across these three companies?" And then if Kroger underperforms Safeway and Walmart, my algorithm tells me to sell Kroger stock and use the proceeds to buy up Safeway/Walmart.
This gives Safeway/Walmart a lower rate of effective borrowing, which means they can build new stores in territory adjacent to Kroger locations or expand into territory none of them dominate. It sets off a cascading effect in which Safeway gets to grow while Krogers treads water. Eventually, Safeway can start installing stores directly adjacent to Kroger and selling everything in this one storefront at 10% under cost-of-purchase until Krogers goes out of business from cut-rate competition. Then Safeway jacks up their prices at this one store and returns to rising profitability.
That's the market mechanism in effect. Low lending rates mean you can drive your competitors out of business. So everyone needs to run a competitive profit margin in order to avoid getting swallowed up by their neighbors. And the folks who decide if you're "competitive" are a handful of mega-investment banks that decide how much of your stock they're going to buy.
And disregarding those expectations can carry personal liability for anyone in a position to do it, because the executive leadership of the company has a legal responsibility to act in the interest of the shareholders above all else.
So like, I'm no stock broker, but if I understand right, a company doesn't directly benefit in any way from a higher stock price, right? They could split it, but for the most part, once their shares are bought up, the only people benefiting from the stock are rando shareholders and the handful of employees with stock options.
As someone that has worked on Wall Street as a professional trader I can agree with what you're saying and I agree that it needs to change. We need to get rid of this idea of endless growth. It's just not reasonable to expect that from every industry considering that industries have cycles and eventually they mature.
You hit a point of maximum (Pareto) efficiency where people are actually driving the most possible benefit from a business and there's a good healthy return financially. And then businesses feel the need to overshoot that and water down the quality of the product until people stop buying it entirely.
Then they just blame changing consumer demand rather than taking responsibility.
It's a real problem and it's going to impact our lives going forward much more aggressively as corporations win the culture war.
I remember back in the day Exxon set some kind of quarterly record, not just for them but for ANY company. Everyone was going "Wooo!" and I was like "Yeah, but now they have to beat that..." Nobody seemed to get it.
Did he say anything about the Albertsons+Kroger merger that’s in the works? ‘Cause that’s not going to make things better and they are acting like it’s a done deal.
Through the magic of capitalism, removing competition will drive prices down! No further questions
Yes there's obviously a decent amount of hey look at me I'm electable going on. But if you take a nationwide chain or two head on and make them lower their prices, It's not like the other chains can ignore it.
The whole point of capitalism is that supposed to be happening all the time. We're just allowing all the big names to buy up all the small names until there's no one else to keep them honest.
accusing the stores of reaping excess profits and ripping off shoppers.
Thanks now can you do this with all the other companies? All.
Also maybe do something with some teeth, not just empty words. Other consumer products are also outrageous but you literally die without food so this is something nobody can just do without.
The problem is he is in the wrong branch to fix it. This is a legislative issue as always. We need the legislative branch to write laws to punish companies for such things. The average person seems to blame the president for not doing the jobs of the Congresss and senators.
Also maybe do something with some teeth, not just empty words.
What about creating some kind of govt program designed to help shoppers out?
For examples-- help with coupons, help with identifying best stores to shop at, help with delivery perhaps, help give incentives to customer-friendly stores, help shoppers best plan for cost & nutrition, etc etc?
Eggs are again steadily rising in price. Wal-Mart "great value" prices isn't all that 'great' to begin with, with most of it's products.
But can we stop calling things inflation? Call it for what it really has been - G-R-E-E-D
Greedflation
I call it increasing motivation to start fires.
Eggs are again steadily rising in price.
This one can still be pinned on poultry farming greed, but it’s not a pure price gouge.
Avian flu devastates California’s poultry farms as new wave of outbreaks roils industry
Let me preach about the holy sites known as Costco stores.
Also look for locally sourced eggs and meat, dairy, etc. You can probably find some small farms that sell direct to consumer.
Costco is great... But not everything works best when bought in bulk, and not everything freezes well. Eggs for instance, most people probably aren't going to go through 72 eggs in a reasonable timeframe. But it's great for shelf stable items and things you use a lot of.
Yes it is cheaper per unit because you're buying a larger quantity, but nearly every item is going to be $20+. This also assumes that you can afford the membership cost and the up front budget to be able to start to build that bulk stock, and that you have room for holding that bulk stock at home,
These are things that many people take for granted with so many more people living paycheck to paycheck now with increases in so many other costs now as well.
After hearing so many people singing their praises, I finally got a membership.
I used it precisely once. Their prices really were not very good on 90% of what I looked at. Plus they really encourage overconsumption.
Aldi ends up being more convenient and generally cheaper for groceries for me.
I'm not trying to yuck your yum, I just wanted to express an unimpressed opinion for other fencesitters.
Also look for locally sourced eggs and meat, dairy, etc. You can probably find some small farms that sell direct to consumer.
I have yet to find one that was not substantially more expensive than any local supermarket.
Jobs are starting to dry up in some industries because interest rates are so high that larger companies can no longer borrow cheaply to take a chance on side projects. The rates are high to combat this "inflation", and of course it won't work, because we aren't seeing real inflation. We're just seeing companies charging more because every industry is now an oligarchy. It's a bit of a death spiral.
I hate to be that guy, but actually it's not just "greed" this time. There was millions of chickens that had to be culled due to a viral outbreak of Avian flu last season and we are just now seeing the effects of that. Don't get me wrong greed does play a part, but the major contributing factor this time around for eggs is not greed, but the system rebounding from the outbreak. I know it's trendy to say greed ruins everything (it can and does), but in this case it helps to have actual context to know what's going on with the overall picture of things. The more you know, ya know.
https://www.gro-intelligence.com/insights/us-egg-prices-jump-amid-deadly-surge-in-avian-flu
I love to be this guy, but egg production barely dipped in comparison to the MASSIVE jumps in price. They pulled the exact same excuse a couple years back when prices jumped 6x or so. Tell me where on this chart was that price jump ever justified by anything other than greed: https://www.statista.com/statistics/196094/us-total-egg-production-since-2001/
Wonder what it will be next year.
Inflation literally means prices going up. Calling it as greed isn't useful, because greed can lead to both price increases or decreases, depending on the context. For example, firms that are greedy for market share can drive prices down (a phenomenon that American consumers have benefited from greatly, over decades).
No, inflation means purchasing power decreasing. Prices going up is an effect of that rate but they are not directly tied. Not everything goes up by a flat percentage every month or year.
The food price increases were never at the rate of inflation. The worst inflation the US saw was 9% in June 2022, but that was just for that month period.the overall rate for 2022 as a whole was 8%. For 2023 the annual inflation rate was back to almost normal, at 3.5%, just above the 3.2% long term inflation rate.
So even if we assume costs jumped immediately, if a price went up more than 9% it was bullshit.
Publix absolutely has fleeced it's customers since the pandemic.
We dropped Publix and went to Kroger. Saved sooo much $$ for delivery right to our door. We just use Publix to buy fresh meat.
I loved doing grocery delivery but its always always worth to get produce and meat yourself.
It's absolutely insane. I buy almost exactly the same stuff every week. I live alone and change things up with spices and preparation so I don't mind always having the "same" stuff.
I went from 60-70 a week to $100-115 like overnight...
Government grocery stores would solve this and food deserts...
What are you, some kind of Communist? You can't have government run retail outlets. It would be inefficient! It would prevent innovation! It would desaturate the market! It would cause millions of farmers to go bankrupt overnight! The employees would all be rapists and arsonists and unionists, while the managers would be bloated government bureaucrats who only care about their cushy government jobs!
You would cause famine and poverty across the entire nation. It would be the worst thing to happen to the country since the Postal Service!!!
I feel like I've heard a lot of bias placed against the idea of government in the US as something that's the source of problems in the country, where private organizations are usually seen as being the solution and not at all related somehow. It doesn't always strike the mark when criticizing private organizations... people will even jump to the defense of billionaires. Agree that mentioning government grocery stores would result in something like "what you want the government to run groceries? they can't do anything right, why would you want them to do that?"
But then the government would have to remedy the surplus of food by implementing food banks. Then markets would crash because everyone would go to food banks instead of grocery stores. Then money would be worthless and the government would have to step in and offer some type of work for rations program. And if that’s successful, it would spread to other industries for furniture and other goods. Is Biden going full Kropotkin?
Must be an election year
Yeah didn't you hear? We're supposed to magically get a national high speed rail network.
Kinda like that one Obama said he was gonna do a decade ago.
Man I wonder what happened to that.
republicans
In Canada, people think this is an exclusively Canadian issue happening specifically only at Loblaws and their affiliates.
ITS AN INDUSTRY WIDE SCAM.
Stop taking aim and fire
Politicians are all words no action, when it helps the poor. When it helps the rich, they don't say a word, just silently pass a bill.
More in the news: government official complains about matters within their jurisdiction.
You have to be some kind of moron to think it would be a good idea for the president to start dictating prices to grocery chains. Unfortunately Lemmy is largely populated by idiots and delusional fools, so I expect this observation to be unpopular.
You have to be some kind of moron
idiots and delusional fools
Do not respond to my comments again with personal attacks. If you do this again, or respond before fixing this comment, I will unfortunately have to report you to the community moderators.
Until you fix it, your comment is not worth addressing.
Read a history book sometime. It's been done in the past.
Why does Biden go after anything but minimum wage? Just because min wage isn't a winning issue doesn't make the problem go away.
Because only Congress can change the minimum wage. You know, the one half controlled by Republicans.
Because he can then actually do something about it. This way politicians can just pretend they are on the side of the working class, while passing bills that only benefit the rich and hurt us.
There is like two links in that "grocery chains".
What?
Old man wags finger
Here's an archive link :)
He's going to do what Canadian leaders are too dumb to do.
Point?
My point is that in Canada, the grocery market is dominated by a handful of large companies: Loblaws, Safeway, Metro. Loblaws' CEO, Galen Weston is practically the main person responsible for food inflation in Canada, while announcing record profits for all his grocery chains and food brands.
The government hasn't done shit to reign in these fuckers and tell them to stop preying on consumers. Meanwhile, food banks in Canada have never been so overwhelmed with demand.
He ain't gonna do shit. It would hurt his rich buddies.
This is the best summary I could come up with:
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.
Economic research suggests the cost of eggs, milk and other staples — which consumers buy far more frequently than big-ticket items like furniture or electronics — play an outsized role in shaping Americans’ views of inflation.
“It’s hard to figure out what the short-term policy response is in this situation,” said Bharat Ramamurti, a former economic aide to Mr. Biden and an author of a report on grocery-price inflation that will be published on Friday from the progressive Groundwork Collaborative in Washington.
A new analysis from the White House Council of Economic Advisers suggests that elevated profit margins among large grocery retailers could be contributing to the stubbornly high price of food on store shelves.
The analysis, which relies on Census Quarterly Financial Reports data, found that food and beverage stores have increased their margins by about 2 percentage points since the eve of the pandemic, reaching their highest level in two decades.
Researchers from the Federal Reserve Bank of Kansas City found last year that strong job growth in the U.S. economy, and the wage gains associated with a tight labor market, were key contributors to grocery-price increases.
The original article contains 1,165 words, the summary contains 224 words. Saved 81%. I'm a bot and I'm open source!
Palm the saffron and pecorino romano
I already palm my peckerino pretty much daily.
Kroger has 2750 grocery stores. 912 million divided by 2750 is 0.3316 million in profit per store
or
each store they own generates $331,636 in profits a quarter.
This is 2.7% of their overall revenue.
What profit margin is acceptable? 0.1%? 0.0%?
I would say something around 10 to 15% would be an appropriate profit margin. But they would need to not try and get around that just by boosting executive pay. Now if they give the workers themselves better pay...
10-15% would be 3.7 times higher than what they have been making.
So they should have made 3.38 billion per quarter, instead of .912 billion.
That's good because they are. Sometimes they don't even have the prices accurate I've actually had to report my local Target to the department of weights and measures because they don't even have prices at the register that match what's on the shelves.
Biden takes aim at Palestinian children over objections of humanity.
This is hands down some of the stupidest shit to focus on.
The big expense in our lives isn't gas and groceries. It's fucking healthcare. Let's all just fucking ignore INSANE pharma profits and INSANE profits for health insurance companies who are legally required to not earn more than 20% of the 100% pie of healthcare spending for treatments.
We pay more for drugs, medical devices and treatments than anywhere else in the world because we do not collectively bargain. We don't regulate price changes AT ALL like almost every country in the world does.
Insurance companies are encouraged to raise the prices for treatments - and thus premiums - because they cannot make more than 20% of said treatments. So if a treatment is $100, they can only profit $20. If a treatment is $10000 - the insurance company can profit $2000. DOES ANYONE SEE THIS AS A PROBLEM!?!?!?
We don't regulate price changes AT ALL
Biden specifically made the prices come down for 43 drugs as part of the Inflation Reduction Act.
“Thanks to President Biden’s new lower cost prescription drug law—the Inflation Reduction Act—manufacturers of qualifying drugs must pay rebates to Medicare if the price of those drugs increases at a rate faster than the rate of inflation. And, Medicare now has the authority to negotiate lower prescription drug prices for the first time,” said HHS Secretary Xavier Becerra.
Healthcare expenditures are about 8% of average expenditures by Americans. Food is 12%, transportation is 16%. Housing is 34%. Maybe you can argue that healthcare prices have the most scope for reduction, but it's literally incorrect to say that healthcare is "the big expense in our lives".
Is that 8% figure including employer contributions to healthcare?
I myself pay a fraction of the $1500 monthly premium that is paid for me. I’m still working for that entire premium. I still have a high deductible plan and pay $300 out of pocket for the first several thousand dollars of deductibles for pcp followups.
The big expense in our lives isn’t gas and groceries. It’s fucking healthcare.
I'm in a lot of healthcare debt.
I can pay it off slowly.
You know what I can't pay off slowly? Food and gas.
You're not wrong about those other things being major problems! But that doesn't make this shit stupid and gas and groceries hurt people in their daily lives. It can literally mean going without food or can't apply to jobs outside an area etc. Roadblocks.
Healthcare is also an extremely important right we should have that many agree that America is failing to provide. It's just a little higher on the hierarchy of needs and you treat the lower ones like they are non existing or unimportant.
People being forced to choose between rent or food so that some motherfucker can have a more profitable quarter is not a stupid thing to focus on, it's a serious problem. You're not wrong on that other point though, maybe they'll address it next, despite the memes they're pretty active for a status quo government.
Nothing you said is wrong, but it's an election year and if Biden can make the price of groceries at least stay the same it will help.
Democrats have too many constituents that are employed in the health insurance or pharmaceutical industries to ever make a meaningful changes.
Democrats have too many constituents that are employed in the health insurance or pharmaceutical industries to ever make a meaningful changes.
Republicans too. All the big politicians seem to be in bed with the industries draining us dry. They both lie to us about how what they will do will fix it but neither are willing to stomach the price of dismantling the insurance scam industry.