What Your Chipotle Burrito Is Trying To Tell You About The Economy

HuffPo: Have you recently eaten a Chipotle burrito in front of the TV while binge-watching one of your shows on Netflix? Maybe? Probably? If so, then you, my sloppy TV friend, just might have the secret answer to the mystery of the future of America’s economy. Here is what I mean: Both Chipotle and Netflix announced their quarterly profits on Monday. Both reported that they had annihilated all of the competition, with quarterly profit gains of eleventy gazillion percent or some such ridiculous figure.

And here is the twist that opens the key to the cupboard with the secret knowledge of the future: Both of these companies managed to add customers despite having recently jacked up prices. Chipotle and Netflix both asked us to pay more for burritos/videos, and, instead of fleeing, we gladly gave them extra money for more of their sweet, sweet burritos/videos. If we get a few more companies reporting this sort of behavior, then it could be a sign that companies have developed what is known in fancy economics textbooks as “pricing power.” And pricing power can lead to inflation.

It could just be that, instead of a sign that wages and prices are on a fast train to Inflation Town USA, Chipotle and Netflix being able to raise prices is just a sign that we really, really, really love us some Chipotle and Netflix.

Click to read entire article.


 

Woah you needed 2 line graphs to tell me that Chipotle and Netflix are getting more and more popular? You needed to conduct tests and surveys to validate customers paying more for their favorite things? What an astute conclusion! Why didn’t I think of that?

This dude must not hang around white girls enough. 2 of their favorite things are Chipotle and Netflix (others include sushi, Hunter Boots, and Starbucks). For christ’s sake you can’t go 3 hours on twitter without seeing chicks yapping about spontaneous chipotle cravings or their newly found addiction to Netflix. It’s not even girls for that matter. It’s people. People love Chipotle and Netflix. I don’t need some hot shot know-it-all throwing fancy words at me talking about inflation and shit. Bro if you like something, you’re willing to pay more for it. Supply and demand 101. That’s basic basic day 1 economics.

Both chipotle and netflix destroyed their competition in earnings? Yeah no fucking kidding, man. Because there is no competition, Netflix especially more than Chipotle. They’re dominating a totally self-built monopolized industry. Pricing power? Yeah over the wannabes and copycats that don’t stand a chance to stay afloat if they seek to overtake the industry kings. Inflation is a doubtful outcome considering nobody can match their prices while still continuously building a fanbase. Moe’s can’t charge the same prices as Chipotle because they can’t maintain sustainable profit margins. There’s no price competition for Chipotle; they set the price as they please and loyal customers will not take their business elsewhere for a cheaper meal. Bottom line is they’re putting out a better quality product (taste, portion, convenience) and can charge whatever they want.

Americans are getting lazier and lazier. And while some view this as a problem, the business world has been capitalizing on these economic changes. It’s all about convenience; whatever is quick and easy is more often than not the route of choice. Netflix is basically untouchable at this point it seems like. I don’t even use netflix (admittedly don’t know how), and I know how much market control they have. Everybody watches tv, and with FOMO curiously becoming a growing epidemic amongst 16-24 year olds, the need for people to “binge watch” tv shows has been alarmingly more frequent.

In conclusion, people like Chipotle because it’s spectacular and people like watching their favorite shows on Netflix, and reasonable cost increases are not going to change that. Don’t need a Rutgers Business degree to understand that.

PS- That is an ABSURD portion of guac in that picture. Steve Ells would have a goddamn heart attack if he saw that.

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