Business and Finance

Consumers are increasingly opposing inflation

Published

9 months ago

March 7, 2024

IAM

WASHINGTON (AP) – Inflation has modified the way in which many Americans shop. Today, these changes in consumer habits are helping to lower inflation.

Consumers, fed up with prices that remain on average about 19% above pre-pandemic levels, are striking back. They are moving away from name-brand products in grocery stores in favor of name-brand products, switching to discount stores, or just buying fewer items resembling snacks or gourmet meals.

More Americans are also buying used cars quite than latest ones, forcing some dealers to begin offering discounts on latest cars again. But growing consumer opposition to what critics say is price gouging has been most visible in food, in addition to consumer goods resembling paper towels and napkins.

Stuart Dryden reaches for cream cheese with a store label at a food market on Wednesday, Feb. 21, 2024, in Arlington, Va. (AP Photo/Chris Rugaber)

In recent months, consumer resistance has prompted large food corporations to reply, rapidly slowing price increases from the height levels of the last three years. This doesn’t mean that grocery prices will return to the degrees of several years ago, although prices for some items, including eggs, apples and milk, are below their peaks. However, milder increases in food prices should help further cool overall inflation, which has fallen sharply from a high of 9.1% in 2022 to three.1%.

Public frustration with prices has grow to be a central issue in President Joe Biden’s re-election bid. Polls show that despite the dramatic decline in inflation, many consumers are dissatisfied that prices remain significantly higher than before inflation began to speed up in 2021.

Biden echoed criticism from many left-wing economists that corporations have raised prices greater than mandatory to cover their very own higher costs, allowing themselves to extend their profits. The White House also attacked “contraction inflation,” through which an organization, quite than raising the value of a product, as an alternative reduces the quantity of a product in a package. IN video released on Super Bowl SundayBiden condemned contractionary inflation as a “scam.”

Consumer resistance to high prices suggests to many economists that inflation should proceed to say no. That would make this bout of inflation markedly different from the devastating price spikes of the Seventies and early Eighties, which took longer to beat. When inflation stays high, consumers often develop inflationary psychology: ever-rising prices prompt them to rush purchases before costs rise even further, a trend that may itself perpetuate inflation.

“It was a fear that everyone would tolerate higher prices,” said Gregory Daco, chief economist at consulting firm EY, who notes that hasn’t happened. “I don’t think we’re going to go into a high inflation regime.”

Instead, this time, many consumers reacted like Stuart Dryden, a business bank underwriter who lives in Arlington, Virginia. During a recent visit to his regular food market, Dryden, 37, noticed the wide price discrepancies between Kraft Heinz products and competitor products sold on store labels, which he now prefers.

Dryden, for instance, loves cream cheese and bagels. A 12-ounce package of Kraft’s Philadelphia cream cheese costs $6.69. He noted that the shop’s brand costs just $3.19.

A package of 24 individual slices of Kraft cheese costs $7.69; on store label, $2.99. And a 32-ounce bottle of Heinz ketchup costs $6.29, while the choice product costs just $1.69. Similar gaps existed for macaroni and cheese and grated cheese products.

“Just these five products together are already almost $30,” Dryden said. He calculated that the replacements were lower than half the value, at about $13.

“I’ve tried private label products and the quality is the same, so switching to private label products from products I used to buy a lot of is almost a no-brainer,” Dryden said.

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Alex Abraham, a spokesman for Kraft Heinz, said the corporate’s costs rose 3% within the last three months of last 12 months, but the corporate raised its own prices only one%.

“We are doing everything we can to increase the efficiency of our factories and other parts of our business to offset and mitigate further price increases,” Abraham said.

Last week, Kraft Heinz said sales fell in the ultimate three months of last 12 months as more consumers switched to cheaper brands.

Dryden has taken other steps to lower your expenses: He moved right into a latest apartment a 12 months ago after his previous landlord raised the rent by about 50%. His former apartment was next to a comparatively expensive Whole Foods food market. He now shops at nearby Amazon Fresh and has began visiting discount food market Aldi every few weeks.

Samuel Rines, an investment strategist at Corbu, says PepsiCo, Kimberly-Clark, Procter & Gamble and plenty of other consumer food and packaged goods corporations have taken advantage of rising production costs resulting from supply chain disruptions and Russia’s invasion of Ukraine to dramatically increase your prices – and increase your profits – in 2021 and 2022.

This was helped by the undeniable fact that tens of millions of Americans saw significant wage increases and received stimulus checks and other government aid that made it easier for them to pay higher prices.

Still, some have decried the phenomenon as “greedflation.” In a March 2023 research paper, economist Isabella Weber of the University of Massachusetts at Amherst called it “seller inflation.”

However, late last 12 months, a lot of these same corporations discovered that this strategy was not working. Most consumers have long spent their savings accrued through the pandemic.

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Lower-income consumers particularly are racking up bank card debt and falling behind on their repayments. Overall, Americans are spending more fastidiously. Daco notes that overall sales through the holiday shopping season were up just 4%, and most of that was as a result of higher prices quite than consumers actually buying more things.

As an example, Rines points to Unilever, which produces, amongst others, Hellman’s mayonnaise, Ben & Jerry’s ice cream and Dove soaps. In 2022, Unilever increased the costs of all its brands by a mean of 13.3%. Sales volume is down 3.6% this 12 months. In response, it raised prices by just 2.8% last 12 months; sales increased by 1.8%.

“We’re starting to see that consumers are no longer willing to accept higher prices,” Rines said. “Therefore, companies have become a bit more skeptical about the ability to use price as a driver of their revenues. They had to return these quantities and the consumer did not respond in a way that he was satisfied with.”

Unilever itself attributed recent poor sales leads to Europe to “loss-sharing with private labels.”

Other corporations have noticed this too. After declining sales in the ultimate three months of last 12 months, PepsiCo executives signaled they might halt price increases this 12 months and focus more on increasing sales.

“In 2024, we will see… a normalization of costs, a normalization of inflation,” said CEO Ramon Laguarta. “So we see everything coming back to our long-term” price trends.

Jeffrey Harmening, CEO of General Mills, maker of Cheerios, Chex Cereal, Progresso and dozens of other soup brands, admitted that his customers are increasingly searching for deals.

McDonald’s executives said consumers with incomes under $45,000 visit the outlet less often and spend less, and say the corporate plans to distinguish its lower-priced products.

“Consumers are more cautious – and fatigued – when it comes to prices, so we will continue to be consumer-led in our pricing decisions,” Ian Borden, the corporate’s chief financial officer, told investors.

Officials on the Federal Reserve, the nation’s principal inflation-fighting institution, cited consumers’ growing reluctance to pay high prices because the principal reason they expect inflation to steadily decline to its annual goal of two%.

“Companies are telling us that price sensitivity is much greater now,” Mary Daly, president of the Federal Reserve Bank of San Francisco and a member of the Fed’s rate of interest committee, said last week. “Consumers don’t want to buy if they don’t see a 10% discount. … This represents a major improvement in the role consumers play in curbing inflation.”

Research from regional Fed banks shows that corporations across all industries expect smaller price increases this 12 months. The New York Fed says corporations in its region They plan to boost prices by a mean of about 3% this 12 months.to a decline from roughly 5% in 2023 and as much as from 7% to 9% in 2022.

Such trends suggest that corporations were on target to slow price increases before Biden’s latest attacks on price gouging.

Claudia Sahm, founding father of SAHM Consulting and former Fed economist, said, “consumers have more power than President Biden.”

This article was originally published on : thegrio.com

Business and Finance

Crypto surges after Trump’s election – but is it a good ethical investment?

Published

6 hours ago

November 21, 2024

IAM

Estimated 18 million Americans are invested cryptocurrency– says the Federal Reserve. And the United States has just chosen pro-crypto-president.

Cryptocurrencies like Bitcoin have change into trendy digital resource. Supporters say crypto undermines capitalism because it bypasses traditional bankers. Crypto perhaps offer quick riches together with an environment of high-tech sophistication.

Early adopters reaped enormous advantages, and plenty of of them became millionaires and billionaires.

Currently, there are approx 100,000 cryptocurrency millionaires. Moreover, cryptocurrency wealth has been built Fairshake, the most important political lobbying group within the US During the last election, it helped elect 253 pro-crypto candidates.

But is cryptocurrency a good ethical investment?

as business professor who studies the technology and its implications, I even have identified three ethical harms related to cryptocurrency which will give investors pause.

Three wrongs

The first harm is excessive energy consumptionparticularly Bitcoin, the primary decentralized cryptocurrency.

Bitcoins are created or “mined” by tens of hundreds of computers in huge data centers, which contributes significantly to carbon emissions and environmental degradation. Bitcoin mining, which accounts for the lion’s share of cryptocurrency’s energy consumption, uses as much as 0.9% of worldwide electricity demand – near Australia’s annual energy demand.

Secondly, unregulated and anonymous cryptocurrencies are the payment system of alternative for criminals fraud, tax evasion, human trafficking AND ransomware – the latter cost victims an estimated $1 billion in fraudulent cryptocurrency payments.

Until about a decade ago, these bad actors generally moved and laundered money through money and shell corporations. However, around 2015, many individuals switched to cryptocurrency, which is a much less cumbersome type of service dirty money anonymously.

The bank cannot store or transfer money anonymously. By law it is a bank passively complicit in money laundering if not enforced get to know your customer measures to curb bad actors resembling money launderers.

However, within the case of cryptocurrency, legal and ethical responsibility can’t be transferred to the bank – the bank doesn’t exist. So who is complicit? Any member of the cryptocurrency ecosystem will be seen as ethically complicit in enabling illegal activities.

Enegix employees work at a data center in Ekibastus, Kazakhstan, certainly one of the world’s largest Bitcoin mines, January 3, 2023.
Meiramgul Kussainova/Anadolu Agency via Getty Images

I find these first two harms to be probably the most ethically troubling. The first harms the Earth, the second undermines global systems of trust – the interplay of institutions that underpin economic activity and social order.

The third problem of cryptocurrency is its predatory culture.

A predatory system, especially without regulatory oversight, exploits small investors. And some cryptocurrencies have enriched their founders by reaping the advantages lack of investor knowledge about virtual currency.

Some cryptocurrencies, especially smaller coins and initial coin offerings, do Characteristics of Ponzi schemes.

For example, the now defunct Bitconnect promised investors big profits who exchanged their Bitcoins for Bitconnect tokens. New investors’ money paid out “profits” to the primary layer of investors with later investors’ money.

Ultimately, Satish Kumbhani, founding father of Bitconnect, decided to achieve this indicted by a federal grand juryand from 2024 his whereabouts are unknown.

A pernicious myth

In addition to the ethical harms of cryptocurrency, there is a pernicious myth surrounding digital coin. The myth of inclusion is the idea that cryptocurrency has the facility to profit especially socially disadvantaged people without a checking account.

The world’s poor who wouldn’t have bank accounts and who could use cryptocurrency for international money transfers to family back home don’t necessarily enjoy the advantages of cryptocurrencies. It’s for this reason need pay conversion and transfer feessay, dollars to cryptocurrency, after which from cryptocurrency to the local currency of the person receiving the cash transfer.

In fact, the distribution of crypto assets is largely concentrated among the many wealthy. A 2021 study found that simply 0.01% of Bitcoin owners controls 27% of its value.

The democratization of finance is often presented as a move geared toward breaking the dominance of traditional financial institutions – private banks and government central banks. However, this narrative didn’t prove true.

Instead, a latest elite emerged: cryptocurrency creatorsearly supporters of i conservatorswho modify the cryptocurrency’s software code and influence its future direction. This group exercises disproportionate control, including over cryptocurrency management. All of this reflects the concentration of power that cryptocurrency was intended to dismantle.

Just a little more ethical?

To be fair, the cryptocurrency community has not ignored the criticism, including calls for greater environmental awareness.

In early 2021, community members founded Cryptocurrency Agreement. The group has recruited around 250 crypto corporations to cut back environmental damage.

The following 12 months, Ethereum took its most important step with its Ether coin. It has reduced its size energy consumption by over 99% by migrating to a coin mining mechanism called “proof of stake”, which doesn’t require miners to unravel complex, energy-intensive puzzles to validate transactions.

It was a daring move. However, Bitcoin, the most important cryptocurrency, has not followed in Ethereum’s footsteps. Bitcoin stands out in that its energy consumption exceeds that of another cryptocurrency.

A worker stands between two rows of bitcoin mining machines along a wall. — A employee installs a latest row of bitcoin mining machines on the Whinstone US bitcoin mining facility in Rockdale, Texas, October 9, 2021.
Mark Felix/AFP/AFP via Getty Images

To address other harms of cryptocurrency, some Regulatory authorities began to regulate the cryptocurrency market in 2023, the European Union, the United Kingdom and the United States have launched efforts to curb criminality and protect investors.

In January 2024, US regulators listed funds allowedthat are popular investment funds for investing in cryptocurrencies. The move was intended to assist small investors trade in a safer market.

However, normalizing cryptocurrency trading could have perverse ethical consequences.

For example, probably the most successful ‘ethical’ fund in 2023, Nikko Ark Positive Change Innovation Fundwas successful with a 68% return because he bet on cryptocurrencies. Its manager rationalized this investment by repeating the parable that cryptocurrency allows “providing financial services to underbanked people“

Where does all this leave the ethical investor?

I consider that investors have two clear ethical options regarding cryptocurrencies: they will abandon Bitcoin or no less than put money into other cryptocurrencies that minimize harm, especially environmental harm.

However, even so-called ethical investments raise hidden ethical issues.

Many ethical investors put money into the so-called ESG funds that emphasize social or environmental impact. Some of those ESG funds may avoid holdings in oil corporations by investing directly or not directly in cryptocurrencies.

This doesn’t seem ethically coherent.

While cryptocurrency offers exciting opportunities and the potential for prime returns, its environmental impact, links to criminality and predatory nature pose significant ethical challenges.

This article was originally published on : theconversation.com

Business and Finance

Daymond John celebrates the fifth annual Black Entrepreneurs Day

Published

1 day ago

November 20, 2024

IAM

shark tank, Black Entrepreneurs Day, Daymond, John, deal, stalker, grants, Black entrepreneurs

Daymond John will have a good time the fifth anniversary of Black Entrepreneurs Day in Atlanta for the first time.

November 22, John’s signature Black Entrepreneur Day (BED) will take over Atlanta’s historic Fox Theater to have a good time Black Excellence and Opportunity. This 12 months’s event is free for all to attend and includes brand activations that enable participants to reinforce their business and brand for the foreseeable future.

From insightful discussions with inspiring guests to the NAACP Small Business Powershift Grant Program, which can award over $1 million in grants to over 40 Black-owned businesses, Black Entrepreneurs Day offers the whole lot a Black business owner needs to raise take your corporation to the next level the next level. This 12 months’s event is special for John; In addition to hosting BED in Atlanta for the first time, the event shall be streamed live for all to enjoy.

“We’re doing it live this year and we’re always trying to improve what we have,” John says BLACK ENTERPRISES.

“I think we added another element to it called ‘Entrepreneur Square,’ where if you want to come early, you can come in and a company like Constant Contact takes photos. Hilton for Business, Chase, Chase Wealth Management is there, US Navy. You add a lot of different things to it.”

It shall be a star-studded event featuring Grammy-winning artist and philanthropist Kelly Rowland, iconic artist Flavor Flav, influential media personality Charlamagne tha God, Olympic gymnast Jordan Chiles (presented by JP Morgan Wealth Management), financial educators Rashad Bilal and Troy Millings with “Earn Your Leisure” and a live performance by multi-platinum Atlanta rapper 2Chainz presented by Raising Cane’s.

Through the NAACP small business Powershift grant program, entrepreneurs can do exactly that use to the Powershift Grant program and grow to be one in every of 40 firms awarded a share of grants value over $1 million. This 12 months, partners including JPMorgan Chase, Hilton, T-Mobile for Business and Constant Contact will contribute a complete of $100,000 in grants, with each grant valued at $25,000.

“We are very passionate about what we do,” John says of the Black community. “I think we can now gain more power by democratizing the retail space with solutions like artificial intelligence and social media. Let’s support each other and support each other.”

Given the strong sponsorship support for BED 2024, John sees it as clear evidence that giant corporations recognize the value of investing in the Black community, even in the face of opposition from anti-DEI efforts.

“There are many other cultures that love to support us as well. They love our music, they love our food, they love everything about us and they just want to know how they can support us,” notes John.

“I think if we look at it this way, it means we can never gain or thrive on our shortcomings, but we can always find those gems and ways to grow from what we are. We are a resilient nation loved by all.”

Launched in 2020 to handle the challenges facing the community in the wake of the events surrounding George Floyd, Black Entrepreneurs Day was established to shift the focus from hardship to empowerment. Designed to uplift Black entrepreneurs, the event goals to teach and encourage through conversations with iconic Black leaders and celebrity guests, features celebrity musical performances and offers key financial support through the NAACP Powershift Grant program.

Tickets for Black Entrepreneurs Day 2024 are free and may be purchased at: BlackEntrepreneursDay.com Now. Press play to learn more about this 12 months’s event.

This article was originally published on : www.blackenterprise.com

Business and Finance

Black Girl Digital on a mission to empower diverse creators

Published

1 day ago

November 20, 2024

IAM

Black girl digital, LaToya bond, LaToya shambo

Meet Black Girl Digital (BGD Media), one among the fastest-growing multicultural, independent marketing agencies within the makerspace, is led by two dynamic Black women entrepreneurs.

Founded and led by CEO LaToya Shambo and CMO Latoya Bond, Digital black girl goals to deliver revolutionary, data-driven marketing solutions tailored to the brands and creators who’re shaping the longer term of promoting and commerce. With a long time of combined experience, these two business leaders have come together to create an agency uniquely equipped to navigate the complexities of multicultural marketing.

“The mission of Black Girl Digital is really about how to bring brand and creators together to go beyond partnerships and build a deeper relationship,” says Shambo BLACK ENTERPRISES.

The pair first met while collaborating on the 2023 Black Girl Digital Awards. While many individuals discuss women competing in business, Shambo and Bond saw a chance to mix their strengths and platforms.

“We went through the process of working together and I saw her talent and she saw my talent. We noticed that we both had these unique skills that worked really well together,” Shambo says.

Combining Black Girl Digital’s expertise in influencer marketing with the BBM Agency’s strength in celebrity business management, BGD Media is uniquely equipped to handle the intricacies of multicultural marketing.

“Because her company was more involved in paid marketing, brand management and communications strategy, it really complemented what we did on the Black Girl Digital side, through partnerships with corporate brands and diverse creators,” Shambo explains.

“Together, we have been able to join forces and offer our brands and creators a full range of media and marketing services, thanks to which the partnership goes deeper rather than superficial.”

Shambo attributes BGD Media’s success to its multimarketing service offering that “brings the customer closer to the creator and the creator closer to the customer.” One of the newest initiatives is the inaugural Black Influencer Weekend, which goals to showcase to major brands and corporations how Black creators are usually not only setting trends, but additionally driving significant cultural and economic change across industries.

During the three-day event, over 1,500 participants engaged in vigorous discussions and activations focused on community, connection and variety amongst creators. Highlights included the VIP Creator Games Night featuring bowling competitions and life-size Connect 4 video games, creating what Shambo describes as a “creator playland.”

On October 2, participants took part in a day stuffed with inspiring and influential discussions in the course of the Influencer Summit. Speakers included media personality Yandy Smith; creative director of beauty and lifestyle Tiarra Monet; and NCAA champion and ladies’s basketball coach Sydney Carter. Conversations covered topics equivalent to balancing a profession outside of social media, maintaining mental health, and constructing meaningful partnerships.

The weekend concluded with the third annual Black Girl Digital Awards, where content creators equivalent to Druski, Monet McMichael and Kai Cenat were honored for his or her power, position and recognition across various platforms. Additionally, business leaders equivalent to Yandy Smith, Marvet Britto and Mona Scott-Young have been recognized as pioneers of influence and visionaries redefining the digital landscape.

At its core, Black Girl Digital is about tackling the complexities of multicultural marketing, demonstrating that representation matters and that success comes when brands connect with communities on a human and private level.

“It’s not a monolith. This is not just one group of Black people. There are many people and many cultures in the Black community,” Shambo says. “Being able to express it. But that’s really why brands work with us. Because we are able to accommodate the different cultures found in each community.”