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Politics : Ask Michael Burke -- Ignore unavailable to you. Want to Upgrade?

To: re3 who wrote (94615)	2/23/2002 12:00:27 PM
From: Joan Osland Graffius	Respond to of 132070

retired, >> if there is inflation, this trio will just raise prices How are you doing? I was digging into Starbucks financials to see just how overpriced the stock is and noticed their same store sales in January were up 7% because of price increases not an increase in business. This generation still seems to be buying high and higher price coffee. The last time we saw massive price increases in goods we also had inflation salary increases. Was a manager during those years and everyone got an inflation salary increase and performance increases were over and above the rate of inflation. We were in a situation where most companies had pricing power and just kept on raising prices and salaries. Guess the question is will these companies have pricing power during an inflationary period or do we have a different environment today. Am not sure the values of these stocks will be higher during an inflationary period. Also think one has to know where inflation is going to come from - higher oil prices - foreigners selling our debt - devaluation of the US$ - etc. IMO, the reason for inflation will dictate which assets increase in value. Joan