credit-management
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When the shortage is the strategy
opinion
14 min read
U.S. consumer prices have remained high after pandemic-era supply shocks eased, while the source argues that large companies have used constrained supply and pricing power to preserve wider profit margins. It cites a rise in average markups over cost from 56% in 2020 to 72% in 2021, corporate profits of $4.42 trillion in the first quarter of 2026, and S&P 500 net profit margins of 16.9% in the second quarter of 2026. The source also cites $1.28 trillion in credit-card debt in the fourth quarter of 2025 and says 111 million Americans could not pay their balances in full each month. The source describes “rockets and feathers,” or asymmetric price transmission, in which prices rise quickly with costs but decline slowly when costs fall. It links the pattern to consumer categories including groceries, rent, gasoline, automobiles, insurance and pharmaceuticals, while also citing prior price-fixing cases across several industries. A June 2026 class action alleged that Samsung, SK hynix and Micron coordinated DRAM supply reductions; the allegations remain unproven. After the Supreme Court invalidated IEEPA tariffs in February 2026, the source says about $166 billion in company refunds became available and that companies did not generally lower consumer prices. It calls for consumers to delay discretionary purchases, compare prices and organize boycotts, citing Croatia’s 2025 retail boycott as an example of pressure that preceded price cuts and expanded price caps.