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Strategies & Market Trends : MDA - Market Direction Analysis -- Ignore unavailable to you. Want to Upgrade?

To: Square_Dealings who wrote (74428)	4/7/2001 6:19:19 PM
From: Doug	Read Replies (1) \| Respond to of 99985

m.f: Your argument might not be consistent with the current thoughts on Inflation. There are 2 components of inflation, labour costs and material costs. Labour costs makes the bigger contribution. Currently energy has been driving material costs up but that is not serious as it automatically triggers a search for alternate supplies which do exists. A rise in labor costs is far more serious. Currently it is being kept in check by so called free trade. Most Countries with large populations can be stroked to provide the goods and services we need cheaper than it cost here. Fortunately for us we can pick and choose as most do not have the infrastructure , capital or political machinery for open competition on their own. In our anxiety to curb inflation thru free trade , we now face a massive trade defecit. Ciurrently our Dollar is very strong and in demand. A time will come when it starts losing value . You will then see many Countries with dollar surplus dumping them back. When that happens, the cost of imported goods rises. At that stage , inflation will be back and labor will be more demanding. We certainly live in interesting times.!