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Politics : Foreign Affairs Discussion Group -- Ignore unavailable to you. Want to Upgrade?

To: Michael Watkins who wrote (147677)	10/12/2004 7:07:37 PM
From: Keith Feral	Read Replies (1) \| Respond to of 281500

Inflation is good as it will support better profit margins on the cost of goods sold. While this may not be good for the economy as a whole, it will benefit companies trying to pass through rapid price hikes. For example, copper and energy stocks have been doing quite well. Paperboard stocks may start performing as we look toward Q3 results. Demand for coal is escalating as the higher price of oil is making coal more attractive. Everything in the commodity market seems to be in a great place. I am less worried about the individuals or the economy than I am the income statements and operating margins of specific companies. Trying to sift through this whole mess to see who is going to benefit. Energy, basic materials, and utilities are three sectors that will benefit from the shift to higher energy prices. The political tradeoff will be a direct benefit to the OPEC nations in the Middle East. The redistribution of wealth will be enormous. I am sure there are a few shieks kicking back with an enormous smile as they increase production at $53 a barrel.