The Economist Explains Why Corporate Profits Have Risen To New HIghs

Warren Buffet is a shrewd investor.  He invests in firms that have a moat around it that limits competition.  Business strategy courses in MBA programs focus on moat building.  The basic idea is to limit competition in order to avoid price competition.  The Economist describes how moat building has increased industry concentration which, in turn, has limited competition and led to historically high profits and free cash flow in many industries.  The methods used by large firms to build moats around their business are thoroughly described in this article.  It concludes that a big dose of moat destruction and an increase in competition is needed in the US.  Oligopolistic industries are the rule in the US. The Economist argues that it is also a leading cause of income inequality,