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To: Stoctrash who wrote (1239)	2/16/2001 12:34:56 PM
From: John Pitera	Respond to of 12410

Fred, not to sure, the price increases were pretty broad based it seems, but if the consumer will not buy then it could be more of a blip; The frightening element of the PPI report is that the 1.1% surge was from a large combination of factors rather than just a few aberrant spikes. The 3.8% jump in energy prices is less of a concern only because its been around so long, its so well understood and created by cartel-control. The 0.7% jump in the core component offers far more concern, though the surge only left a 2% annual rate. January price hikes in tobacco, cars, trucks, lawn equipment, industrial tools, aircraft and ships argue that the price containment may be giving in at the wholesale level. However, excluding the cigarettes and auto increases the core rose a far more modest 0.3% -- not far outside its typical range. Though it takes more than a month to make a trend, the report is somewhat convincing and would be far more so if it weren't that the economy is running at such a slow speed. But remember that the pipeline to consumer prices is full of gaping holes and the pressure will be strongly muted before hitting consumer prices.