Re:Everything advertised on social media is overpriced junk
by kurthr on Saturday April 08, 2023 @11:40AM
(#35494359)
There's pressure on both sides (competition to lower prices vs take profits from the reputation), but I agree with your take.
Primarily, there has been an extraction of excess profit on consumer goods rather than investment in more efficient production or better products. I have suspicions that this is because of the relative ease of growing a profitable (but easily copied) manufacturing business out of China over the last 20 years, but it really doesn't matter why.
The other example of this is Oil Majors who have very little incentive to invest in new oil production or refining (even though it may be needed for the next decade), and instead take all excess profits to pay out as stock buybacks or dividends. They are in the profit taking stage of the business not the growth and investment stage.
Primarily, there has been an extraction of excess profit on consumer goods rather than investment in more efficient production or better products. I have suspicions that this is because of the relative ease of growing a profitable (but easily copied) manufacturing business out of China over the last 20 years, but it really doesn't matter why.
The other example of this is Oil Majors who have very little incentive to invest in new oil production or refining (even though it may be needed for the next decade), and instead take all excess profits to pay out as stock buybacks or dividends. They are in the profit taking stage of the business not the growth and investment stage.