this post was submitted on 14 Aug 2023
401 points (95.5% liked)

Asklemmy

43912 readers
874 users here now

A loosely moderated place to ask open-ended questions

Search asklemmy 🔍

If your post meets the following criteria, it's welcome here!

  1. Open-ended question
  2. Not offensive: at this point, we do not have the bandwidth to moderate overtly political discussions. Assume best intent and be excellent to each other.
  3. Not regarding using or support for Lemmy: context, see the list of support communities and tools for finding communities below
  4. Not ad nauseam inducing: please make sure it is a question that would be new to most members
  5. An actual topic of discussion

Looking for support?

Looking for a community?

~Icon~ ~by~ ~@Double_A@discuss.tchncs.de~

founded 5 years ago
MODERATORS
Cloak@lemmy.ml
mekhos@lemmy.ml
tmpod@lemmy.pt
14specks@lemmy.ml
401
Why is everything going to shit? (feddit.de)
submitted 1 year ago by Knusper@feddit.de to c/asklemmy@lemmy.ml
133 comments fedilink hide all child comments
 

Was just trying to explain to someone why everything is going to shit, specifically companies, and realized, I don't fully get it either.

I've got the following explanation. The sentences marked with "???" are were I'm lost. Anyone mind telling me, if they're correct and if so, why?

The past few years, central banks were giving out interest rates of 0% or even negative percentages. Regular banks would not quite pass this on, but you could still loan money and give it back later with no real interest payments.

This lead to lots of people investing in companies. As long as those companies paid out more money than those low interest rates, it was worthwhile. But at the same time, this meant companies didn't have to be profitable, because they could pay out investors from money that other investors gave them???

This has stopped being the case, as central banks are hiking interest rates again, to combat inflation???

you are viewing a single comment's thread
view the rest of the comments
[–] GyozaPower@discuss.tchncs.de 46 points 1 year ago* (last edited 1 year ago) (1 children)

I wouls just add that it's all about making profits and increasing them year per year, but always focusing on the short term. To the CEOs, shareholders and other directives, it doesn't matter if the company goes bankrupt 10 years from now, as long as they suck in all the profits they can now.

Even if the company is very successful, with a very good product(s) and they could just go into easy-ride mode continuing to provide those products. They only want to make as much money as quickly as possible and once they get their hands on the company, the enshitification for the sake of quick profits ensues.

[–] Crankpork@beehaw.org 3 points 1 year ago

This is why I feel bad about any company releasing their “best product ever”, because it’s all downhill from there. The only thing left for the shareholders to do is cut costs, worsening the product.