Numbers Numbers. Taken as a snapshot, corporations are doomed. They are profitless and the current situation cannot continue

[Gaius]

@Impenitent

isn’t the underlying problem not that prices are rising, but the value of the currency in which the items are purchased is falling?

That is a related problem, but not the cause (nor a fuller way of explaining it)

What really is happening is:
Borrowing money costs over 5.09%.
Businesses are making just 4.66%.

Wanna open a pizza shop (or start a pod cast, or a bitcoin miner or an AI company?)
For every $100k you sink into the business you will make $4,660 but you have to pay $5,090.

It’s part of why Powell is under pressure to lower rates.
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.
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Some businesses are just weeds. They should have never been opened. The only way they can survive is if Powell feeds them and waters them via lower rates.

Free market says: “They are weeds and they should be allowed to die. Heck that will even help the legit businesses.”

Keynesians say: “We must preserve the crap. In fact we want more crap. We must lower rates to subsidize and sustain every idiotic business decision ever made because, on paper that’s what makes it look like the economy is growing.”