*OT* Greg- Don't know if you saw the recent productivity number (release today I think) was 4.6%...the highest since Winter 1992..(and that, coming out of a recession/big slowdown)..It was an outstanding number, and really took a lot worries away from those worrying about the labor cost inflation...
Don't know if you saw John Ryder (sp?) Bear Stearns this morning on CNBC...I generally agree with his bullish view..
Let's face it...productivity statistics are probably a pile of crap anyway...how do you really measure white-collar productivity..information age productivity....let me tell you how I measure it...
Remember (more often in the past) how some argue/argued, question/questioned how much good technology is increasing productivity...There is a simple way to tell (no need for gvt. statistics)...Companies keep buying technology...and they buy more and more each year....and this has been going on for many years..
If these machines were not helping them increase productivity, they would not keep buying (long-term). Maybe a good Microsoft salesman can get a large corporation to upgrade Windows now and then...but, I trust in capitalism....if these massive buys were not helping, companies would discontinue (or cut back).
Owners (of businesses) are cheap. They do not give their money away easily.
So, I believe that we must have seen/are seeing large increases in productivity, fueled in large part to ever-improving technology..
As long as this is the case, wage inflation is going to be weak, and even non-existent..
We both agree that gold, and commodities (especially oil, but also your corn..others) are dead, with no improvement in site...
(Producer prices? See below..)
So that pretty much covers most of the big issues concerning inflation....
Anyway....That's my view, and I'm sticking with it...
1 other quick pt... Re:inflation....due to greater global competition (lowering of trade barriers, worldwide acceptance of Western-style managment techniques, and acceptance of TQM, etc...), companies have lost a lot of pricing power....profits gains are more directly tied to gains in productivity (now then ever before)...This has put an enormous damper on worldwide inflation..
Now, the internet is kicking in....the great price deflator of our life time...consumer are getting closer and closer to perfect price information..the destruction of weak brands...huge business cost saving acheived by greater supplier/buyer inaction....Dell riding this big-time.... |
