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RE: Ben's..."This is now the 9Th week in which inflation is showing in
full force."
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Ben....timely post.
I am not an economist,..but I do perceive what I would
call a "sea-change" for the price of "things". Oil being most
noticeable....most everyone in denial that the price can
get above $30 for any period of time...that it's a weather
related spike....etc. (there was an RT post looking to
short Oil after Y2k...I think).
Combine these graduated price increases with technology
induced producitivity improvement for companies (supposedly
enabling them to keep costs down or to absorb the
higher costs of "things") and it's a wash according to the bulls.
In other words optimists think that increased productivity can offset
higher raw material costs. I am skeptical,...if for no other reason than
the bullish scenario is so universally held. At some point in time higher
material prices...i.e. inflation will have to be passed on in the form of
higher prices for finished goods,...or companies will earn less profits.
What I am trying to say is the consensus expectation for impact of inflation
is understated or overly optimistic at present,...sort of in denial about
recent price increases which are very real. Also,...this is a global
thing,...not just confined to
the U.S.
Probably born bearish,...at least it feels more comfortable at this point in
time.
JIM Pilliod jpilleafe@xxxxxxx
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