"Problem is the prices" — When Shark Tank star Mark Cuban reflected on how to fix the inflation

Mark Cuban, the billionaire entrepreneur and long-time Shark Tank star, shared his thoughts on addressing inflation during a recent appearance on Andrew Schulz’s Flagrant podcast with Akaash Singh. In a wide-ranging discussion on October 2, Cuban tackled the complexities of inflation, explaining that the problem isn’t the inflation rate itself but the prices that have remained high. Cuban remarked,

“Inflation is fixed, the problem is the prices that are already up are already up.”

He elaborated that while the inflation rate has dropped significantly— “the inflation rate is like two point whatever”— the prices of goods have not adjusted downward. Cuban emphasized that the best way forward is to focus on increasing wages rather than trying to lower prices, which he described as largely non-feasible.

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Shark Tank star Mark Cuban on the Flagrant podcast

During the podcast, Shark Tank's Cuban broke down the root causes of inflation and proposed potential solutions. He started by explaining how inflation is measured, using the Consumer Price Index (CPI) as an indicator of price changes over time.

“If it goes up 9% year-over-year, inflation's 9%. If it goes up 2.3% year-over-year, inflation's 2.3%,” Cuban clarified.

While the rate of inflation has stabilized, the real issue lies in the prices that surged during the inflationary period and have since remained elevated.

Shark Tank star Cuban attributed part of the inflation problem to supply-side factors, such as energy production. He highlighted how past decisions, like reduced oil production, drove up gas prices, subsequently impacting the cost of goods across the board.

“Trump talked and convinced them to reduce production—that pushed up the price of gas, which made everything else expensive,” Cuban noted.

When asked by Schulz why prices haven’t come down now that inflation has eased, Cuban explained that reducing prices isn’t straightforward. Manufacturers and businesses face increased input costs, which don’t automatically decrease even if inflation subsides. Additionally, some companies might exploit inflationary periods to raise prices, regardless of whether their costs have risen.

“When there's inflation, it's not just the things that consumers buy—it’s the inputs that go into making those things,” Cuban stated.

He further stressed that adjusting wages is a more practical solution to help consumers cope with higher costs.

“You’re not going to all of a sudden say, ‘Here’s how we’re going to reduce the price of tomatoes, eggs, or whatever.’ So what you have to do is say, ‘How are people going to make more money?’” he explained.

Cuban emphasized that wage increases can offset the pain caused by higher prices. Using an example, he described how a higher paycheck could alleviate the strain of rising grocery bills.

“If you were making $1,000 a week and your grocery bill went from $500 to $600, that’s pain. If you're making a $1,000 a week and it goes to $1,200, and your grocery bill goes from $500 to $600... you’re good.”

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Inflation and the consumer perspective

The conversation also delved into consumer behavior during inflationary periods. The Shark Tank investor acknowledged that some businesses are forced to lower prices when consumer demand drops.

However, he pointed out that this doesn’t always happen, especially if companies are managing increased costs themselves or taking advantage of the situation. Schulz labeled this behavior as “gouging,” to which Cuban responded,

“It’s not so much gouging—it’s just what companies do.”

Another significant takeaway from the discussion was the complexity of addressing inflation without disrupting market dynamics. Shark Tank star criticized simplistic approaches, such as the overproduction of resources like oil, which could lead to price collapses and economic instability. He argued for a balanced approach that prioritizes long-term stability.

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Shark Tank airs every Friday at 8/7c on ABC.