Moments ago, Fed Chairman Jerome Powell appeared in front of the Senate Banking Committee. During the nomination hearing, in an exchange with Sen. Warren, he publicly acknowledged that big corporations are taking advantage of inflation for financial gain:
Sen. Warren: “Today, nearly two out of three of the biggest publicly traded corporations in the country are reporting fatter profit margins than they reported before the pandemic, which doesn’t sound like they are just passing along costs. So let me ask you, does that increase in profit margins combined with greater market concentration in industry after industry suggest to you that some corporations may be passing along increased costs and at the same time charging more on top of that to fatten their profits margins?”
Chair Powell: “That could be right, but it could also just be…. that demand is incredibly strong, and that they are raising prices because they can.”
Sen. Warren: “Well that’s the point, they are raising prices because they can, and they are not being competed down.”
Email email@example.com to speak to Dr. Rakeen Mabud, managing director and chief economist at Groundwork, about the link between corporate profiteering and inflation. You can read our most recent findings here.
Below is a sampling of recent reporting on inflation that got it right:
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