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Pastimes : Alan Greenspan MUST GO:

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To: Master (Hijacked) who wrote (21)5/24/2000 5:03:00 PM
From: BWAC  Read Replies (1) of 494
 
How about this concept for no inflation:

Too much competition exists at the retail level for all consumer products.

WalMart can't raise prices due to Target, etc. competition.
Grocery store chains competing on every corner.
Drug store chains competing on every corner.
Home Depot vs. Lowes.
All the stores in the mall, competing over who can have the biggest and best 25% off sale.
Office Depot vs. Staples vs. Office Max.
Have any trouble finding the exact automobile you want? With the exact options? In the exact color? With a rebate?
Internet Sales channels vs. ALL of the above?

On and on and on. Serious competition and CHOICES for the retail customer. No one has pricing power, outside of gas which isn't exactly a free market.

Oh but the manufacturers will raise WalMarts cost? Nope wrong there. WMT has to be the low cost provider and they are the biggest buyer from many manufacturers. WMT holds pricing power over these manufacturers. Either you sell/produce it cheaper and better or we go find another supplier.

Inflation does not exist for the informed value seeking consumer. The extreme competition for the retail consumer dollar negates inflationary pressures for any informed value seeking consumer.

Of course the current track of the Fed and interest rates will probably take some of the competing retailers out of the picture and thereby kill off the robust competition. The we better worry.
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