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Strategies & Market Trends : Bob Brinker: Market Savant & Radio Host -- Ignore unavailable to you. Want to Upgrade?

To: J-L-S who wrote (22169)	6/29/2006 2:01:19 PM
From: Kirk ©	Read Replies (1) \| Respond to of 42834

You can make the same argument and substitute "rent" with "energy." When you do that, the cost of higher rent for the trucker is similar.... Are you and Bob going to argue next that higher rents are not inflationary too? Inflation is defined is loss of purchasing power. If Bob's listeners have less to spend at Walmart because they spend more on gasoline, then they have lost purchasing power, thus have been impacted by inflation. BTW, have you noticed how much more Walmart and Coke charge for sugared sodas? Shipping costs, oil for the plastic bottles or to melt the Alum cans and sugar going to make ethanol are all more expensive due to higher energy prices. Walmart raised its prices on its house brand sodas by about 10% recently... I guess they felt they could pass on the higher prices for a product that has a high energy content.

To: J-L-S who wrote (22169)	6/29/2006 4:09:46 PM
From: David Bogdanoff	Read Replies (2) \| Respond to of 42834

Even if typical (non-energy) consumer prices remained the same, despite higher production costs, the purchasing power of consumers would decline(less able to buy) simply because of those extra energy costs which they must pay at the pump and in their utility bills. This describes a loss of purchasing power, inflationary by definition. What BB has stated is that the oil component of the economy is less than it was in the energy crunch of the 70's. This only mitigates the inflationary impact of higer oil costs, not completely eliminate it. BTW, shippers have the most sophisticated system of pegging shipping rates to gas prices. The users of shipping services are charged a surcharge following current oil prices. By view is that inlation is higher than is tracked in official CPI figures. The higher med costs, housing prices, and even food costs are not offset by lower computer costs and declining big-screen prices. Just my opinion. Bogtalk