I am willing to bet next months read on CPI and PPI coming in pretty high, and probably higher than anyone would have imagined. And the Fed may have advance data on that, already.
Traders are realizing the Fed is internally worried, and probably not as divided at all, when they see where prices are heading and the risk that it is spiralling out of control despite falling demand, and what that will do to growth (GDP).
Well, I come from a family that operates buses and ferry in somewhat of a large scale (fleet) and I can tell you that $80 oil was about the time when profit margin is zero without a) accounting tricks and b) optimization (i.e. layoffs, operation curtailment/combining passengers in busses/fleet when they're not full, etc.)
The real economy is withering at the level of raw materials, without any ability to pass on the cost because the demand for finished goods are down. Just my two cents.
Here's what they think out there.
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