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Companies feeling the pinch from higher prices

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    Bad recipe for the economy?

  • Duration 7:53
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No last -- double because it just got Barron's and we're all getting baked.

-- getting free cookies as a result of running anyway I had about him he'll give it a box on -- Above very bad recipe for our economy.

In General Mills owners of brands like Pillsbury and Cheerios.

Well let's just say they're not -- -- there -- -- of things like sugar and flour.

Turning their profits a little sour.

This coming as -- seeing a bumpy ride for the rest of the year soaring gas prices of customers scaling back.

So two of the biggest US companies that completely tapped to do the economy are seeing in place yet Washington still insists.

It is not there Adidas is and -- Charles -- Dagen McDowell along with Adam Lashinsky and Charlie Gasparino.

Charles -- -- -- -- I don't think that the government does not believe design inflation the bottom line is what the government you have two -- of fiscal monetary policy.

President Obama is already said listen prices necessarily have to go higher with energy.

Ben Bernanke's goal is to inflate inflate inflate inflate at some point a virtuous cycle gonna community now in there.

They're hiding though that they hide it but they have an agenda and both sides of the equation that control all of this are determined to push their agenda.

Then somebody made him.

Well -- government has a different way of counting inflation interviewing me we got a story and see how higher -- -- -- higher inflation that we go.

Who ran an environment our house where sideways -- higher inflation.

The government has all kinds of ways is I know it's not really a pleasure I've seen as an action over myself I.

Over many many many years but better of course -- -- that we really haven't stagflation.

And it's got to get a lot worse because there's a huge loss in the money supply caused the last few years by mr.

Bernanke.

When that starts getting spread arrests.

A lot easily and raises when the -- -- economy revives we could see a serious here data inflation.

And the you know when you have companies.

Saying it ended there it is in the fight every day.

I'd sooner trust then that I would an academic or anyone else.

-- and that actually can call even more inflation -- that yes exactly exactly and that's what Ben Bernanke's worried about yes to go out there and cover its eyes and say I don't see any -- -- -- -- trying to tamp down non donation he's covering something else here now because he is subsidizing this recovery.

Hundreds obscenely low rate that's absolutely and that equities traded on the part of it led to -- -- what Ben was saying what.

Companies and consumers think inflation is coming down the road they will change their behavior today that actually creates more inflation very rising price -- Because it in the pipeline to ensure that they are on their -- don't get squeezed because prices go up in the future.

So -- of that we could be in the beginning of a very dangerous cycle.

Think about why he's doing what he's doing I'm not a clue who Ben Bernanke I mean -- this is the reason I mean did that all this comes back to 0% interest rate.

He's worried about the banking sector statement.

He's worried about the economy still he would rather create a wealth effect of people buying stocks and and economy getting better and risk inflation there's no doubt about that but this all comes down to 0% interest rates.

And you know what that's why people are buying commodities and that's -- food prices going up that's why gas prices going up.

I don't think 0% interest rates are gonna last forever and you know I would I I would rather see a little inflation.

-- a group -- -- depression.

I will likely voter cards and when you open up your -- one case they thought that we could do a -- you like opera house prices are the gonna be -- better but here's the thing.

Ben Bernanke is -- -- more than one occasion he didn't think Alan Greenspan was responsible for the housing bubble this what has a lot of people afraid they'll will will.

You probably do you probably know he probably said I don't think Alan Greenspan is -- Response but there was Fannie and Freddie but it was a risk taking.

You know walls -- -- back to the subject Adam visits -- what I want to raise with you though is that us.

In the genie is out of the ball and we're we're getting more companies saying you know -- years and then but we see inflation.

And I'm sure gonna get others to do this if for no other reason than to blame lousy earnings are aren't aren't back.

Then he's going to be in a corner right.

Well Lou the issue is sure but I think charge Charlie is is starting to get -- -- and -- the way you look there which Charlie gets -- our tank.

Well you're the only one who calls Charles Payne Charlie Neal I would I would never call and Charley -- I don't know -- to get -- system minister pain but I.

I say I don't think that -- had that's what I would call -- -- that absolutely.

But it low interest rates are are are part of it the other thing is where we are not seeing inflation is in wages remember we have we still have high unemployment.

Would employers are not having to raise wages for their employees.

Right now and by the way.

This is not remotely a political issue or an ideological.

Issue when there's no conspiracy here and that's what I think.

Charlie Gasparino had right Bernanke's not trying to work any schemes in the government is in trying to hide anything from I think there's a different.

-- but -- -- well what I thought what's he doing what he's doing you.

That's why is he doing -- casinos.

Decide is extensive and Ben's going to -- about he's playing with fire here.

Why is he doing there is inherently ladies it is -- have a little bit right I'm not even -- a little -- -- the -- -- but let's let people -- about -- is why is Bernanke doing this it is the absolute failure of fiscal policy of Obama and -- that's -- He's he's -- big money.

Even today the what does that say that he's the only adult in the room and this is what is -- I'd I think I think Ben Bernanke is not a lunatic I think he's a pretty Smart guy and I didn't Loma Linda and I -- that we make it's Alec just throwing gasoline on fight we would.

I think he's really word.

Any Iraqi economy -- backwards again you by the way to take it.

They think whether they have to have that veterans -- not that they think that they can control inflation fighting you know hitting -- That it's that easy I didn't say that but I'm saying that if -- -- thinks that the Federal Reserve can easily manage inflation.

They're out of their tree and by the way one thing that should wake everybody up -- what long term interest rates have done.

In the last couple weeks we got mortgage rates now above 4% -- I know it's so low.

But these long term rates can get out of control and quickly if you actually -- -- -- and try to.

Alarmed about a 4% -- you know what I like my god I -- Presented by her personal blocked it right you know late night I'm alarmed by us fight and the Federal Reserve -- they they -- -- when you read it at that.

-- did you know you do have to.

Recognize history to know that inflation.

Want to sit it starts creeping up boom it's it's on but event that's what Ben alluded to that's what they has just talking about that the ability and it's somehow -- thank you said and on more than one occasion and make it seems like it's like a light switch that don't Laurie when it what is -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- Why doesn't the government see what everyone watching this show us these and I are you saying -- -- -- not -- are subject.

I think I did my editors were determined to play would suddenly February of 1994.

And you had investors sell a lot of debt and it was ugly -- -- noted that there's a reason to wait for that everywhere and not get it listed likes eight months.

You know I just -- it's better than -- It is all right better than the alternative.

All all I wanted to say that the government does not government is not looking at one data point cannot leave just yet another little shots -- but they're looking at everything that all of would have accepted what Adam was saying it's -- that quotation I.

I --

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