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It's official consumers saying they're down -- out.
Over pump prices that are out web site but it's not just gas.
Do close call it health care all white out.
And someone -- said you think the sticker shock is bad now just wait hi everyone I'm Brenda -- that his bold and there.
The -- this week Gary B Smith Tobin Smith Jonas Max Ferris along what -- showed Berger and sees an -- welcomed everybody.
So -- sticker -- is about to get worse.
They get that right Brenda -- food costs are up ever 5% -- -- year some economists are predicting 25%.
Increases just this year a lot of gas is up 6% it continues to rise it's not going to stop any time soon all of us need to be prepared and the economy the global economy is at stake right now because of these higher.
Races -- be -- seeing that same sticker shock and does that worry you as much.
No and now.
And I had to be content really -- Well look guys you look at everything that we you know every dollar that we made was spent on either food or gasoline I'd -- in -- quarter but.
You know we spend our -- basket spending those on a lot of things -- on electricity is on natural gas it's on.
Dining out for example so overall inflation even though we've been talking about it constantly is still under 3%.
As far as gasoline -- acknowledged.
-- point that it's up 7% but inflation adjusted.
We're back at nineteen -- levels plus the percentage -- by GDP that energy is is about 50% of what it was just thirty years ago so.
Could prices go higher yes -- -- a little harmful.
Perhaps but I think people it's just I don't think a topic of the deal.
Back -- not everybody had the model a it was using it to get to work very happy I felt like I.
Good I don't have a good point I didn't tell me take you mod because -- it is actually we are seeing inflation aren't -- in in other things.
You just remember we get core inflation and everything else and and maybe the core is Laura MacArthur picking up food you don't want a lot of good out of the core.
I think -- up -- at the margin -- this point now where this idea sticker shock.
Starts to change behavior we obviously are consuming less gasoline today that we were years ago but the price -- cumulative point that cumulative price point.
In -- recession while we have 16% real unemployment this -- percent.
He knows these -- is not working.
Yet and that is the point where these people can't suspend spent because they're spending everything began when they hit that inflection point -- -- spent last and we know we're gonna have 1% less GDP if we stay above four dollars for you know the next six months -- Susan what do you think where where do you see inflation are you worried about.
-- -- -- camp I don't think it's that big a deal yet we are seeing modest increases but overall it's pretty it's pretty moderate -- And if you look at the Producer Price Index which is a wholesale goods in their costs that's actually.
In very moderate and it's -- in some regions actually coming down in some areas so you know food is actually come down for the past three months in a row on wholesale side.
And so -- -- -- to -- -- break there and wholesale prices are coming down our retail prices are going up that's just price gouging yeah.
Susan that's actually the bottom trying to make is that we're now that point where the passengers -- gonna start to get in those gasoline prices the small business prices they're gonna have to start raising prices at a time and it really can't afford to go because they have to keep keep their -- That's exactly what I'm trying to make thank you for making about.
It is really just on the -- -- that Gary was saying you're not really seeing it across the -- so that's on inflation that's one particular.
Industry went not -- well but at gas is used in in transporting lots of different -- -- oil to.
Yeah but -- I wanna get to you.
Basically you think that simple law of supply and demand may come into play here and that will take care of things.
Because we don't have a supply disruptions like there's no real disruptions of any commodities at this point comparative even a few years ago.
When consumers stop complaining about a high gas prices and actually start doing a lot about it you can see the price collapse because they're gonna actually put off driving things that are not commuting or they're gonna park or whatever that hasn't really current significant levels are -- are.
-- -- Kidding me the artist I can't believe this -- -- and Gary be here all completely wrong I.
Hot air hot because hot when leading going entirely your call -- yeah.
Know our history our 100 year inflation rate is higher than the current inflation which albeit is higher than -- So you're saying the right that is right more than a hundred year history of America is -- -- America is so you're saying -- judge Joseph Q public on main street that's right that's gotta tell him because he's just -- -- -- six hours per gallon of milk.
Two hours more than they had to it -- the same price.
Anyway I think I would all the calls -- who -- to -- not a year ago that's the thing and yeah.
That's a separate demographic -- you know that Bob you had people right now in this country that candy that feed our families -- doing.
It's not American.
I am sorry did a -- consider prices of -- the people money but they don't gonna talk about but the president Malloch.
There's other things -- the basket pulp prices have not been going to do it regularly -- -- I'm totally -- of the committee bigger and I think now don't you think.
You don't need and I had to -- -- -- food eating -- staples those are the items they keep increasing.
Predict it'll want to -- yet but it can't eat it it this idea and let's not get so obscure public just real world when you're physical -- -- what fifty or 75 dollars a week because of the physical products you have to buy to let that comes out it coming I'm not saying this is Armageddon what I am saying is that that it -- slows our economy at a point where were very weak it.
If it brings a another level of consumer anti sentiment you have to -- and I'm buying and all the good that we generate over the next six months were at that precipice right now what we can slip backwards and that's the scary part.
A go ahead but I was to -- what what would you proposes the solution and because ordinarily when you're starting see inflation across the port.
You wanna see the feds are to raise interest rates right that's not something we can do right now I mean there's no way you can raise interest rates and not think it's gonna have a contraction -- -- So you know what gathright is you can talk about strategic petroleum reserve but woody what do you propose that we -- you attempt to bring my milk prices.
You can't you can't start going back to this to this that petroleum reserve because he need that for national defense of that issues out off the table second that you did have chairman Ben Bernanke just this week.
Actually was talking about right now about not doing any type of of further easing.
So therefore he's actually trying to manipulate interest rates right now trying to strengthen -- dollar.
Hopefully that brings cost Albert you and I we -- know -- -- it's not gonna keep costs down it just gonna keep going up.
And of course sat at Bernanke as chairman of the Federal Reserve Bank which sets short term interest rates.
Gary V there was a big point made about housing that housing prices are still down even though rent is going up what you say -- that.
Did it exactly that makes the point that Jonas was trying to make that there's a lot of things.
And we have baskets and look the odds of -- me and -- in all being wrong -- top points out are zero so that.
Not a -- -- feeling mathematical conclusion -- that we can possibly not know but yeah.
The other thing is that I think Todd is Hussein is yes what.
What happens when gas prices go up -- people adapt they didn't have choices 3040 years ago my father when gas prices went up I had.
Had to go -- the car that was the only way to get a job there was no such thing as well telecommuting.
Mass transit wasn't as big as it is now people have -- -- -- -- Well -- but I never -- -- that point these small business.
Association has done this in a recent survey like a week week and a half ago and small businesses are supporting Mike point.
Which is it there at the tipping point of raising prices because they can't absorb any Marty Scott remembers not just gasoline it's all the -- -- -- their.
They're also talking about not about.
Changing their hiring practices to that the -- is is hitting them so hard that they may not be hiring and if that happens that start to spiral doesn't it but.
It it it it does everything Gary Gary's point is SpinRite we we use less gasoline our economy that we did but right now but all the other costs tied to the healthcare costs the employment tax -- and etc.
this is that one at a margin another 5% and we will slow down.
Okay last word -- -- he's absolutely right look you cannot take you cannot hit discretionary income especially we have so many families in America they're still continuing to struggle.
An assistant clinical and economic recovery that's taken place but you can't take look they're killing the discretionary income budget right now at various -- it's a silent.
Part of the kind of saw somebody RadioShack stop when they should be put food on their families' tables and those of the costs are going up and I got to tell you guys the bottom line for those companies will hit stocks as well.
Okay all right that's -- final works thanks so much pat.
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