Wal-Mart CEO says "Serious Inflation" on its way.

I don't think we can base economic futures on Walmart sales predictions. I say this because I believe Walmart is suffering because the economy is coming back and people are spending more money. Walmart has spent the past decade buying cheaper and cheaper stuff from over seas and now it's killing business. People who have the cash to buy things want to buy good things, not cheap things, so are looking elsewhere for quality merchandise. Walmart depends on bad economies and cash-strapped consumers to keep their margins thick. So, when their customer volume is down 30%, their prices have to rise, and in fact, there is an inflation situation, but only once inside their doors.
Guy

 

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But two and a half years ago, those silver dimes were worth less than 75 cents each. Has a loaf of bread quadrupled in price where you live?

 

High inflation would be a good thing for me given that I am pretty heavily leveraged with student loan debt.

 

Quoted for truth!

This price increase will only hurt Wal-mart, which is about time as they've hurt other competitors for years.

 

But then there are those young families that have been forced into a dual income situation just to get by with hungry mouths to feed and shoes to buy. It's not that your glass half full perspective is wrong but in the context of this discussion it seems you are turning a bit of a blind eye toward the plight of people who are more hand to mouth. Increases in food and fuel is a big problem for the economy and for our citizens, we should hold our elected officials accountable for the huge mess they have created(ing). A little introspection on the part of the American people is in order as well.

Regards

Bluesboy65

 

Ya know, it's pretty funny... but the path this country takes over the next two years or so will determine if I have kids.

I have a feeling a lot of my friends are in the same boat, and you might end up seeing the US like Japan... aging population, low birth rates, etc.

 

I really do not follow your logic. I am not an apologist for Walmart but they exist on razor thin margins. Thankfully our economy is improving and unemployment has dipped just under 9% (20% or so all in). Our jobless recovery has not resulted in significantly more jobs but corporate balance sheets do look a lot better. Coroporations are sitting on a lot of money but are not hiring because they are scared off by the 2008 nightmare and are not confident the market will continue to respond once QE2 cones to an end in June. Year over year inflation is rising much faster than the Fed's target, this is not a Walmart phenomenon. I agree that Walmart does not carry the best quality merchandise but they have purchsing power that few others possess. Walmart will be one of the last ones standing as the disposable income of consumers continues to shrink.

Bluesboy65

 

This would actually be beneficail in some respects, but doubtful this is a reallity since our teen pregnancy rate is growing by the year. And I doubt many 15yr olds are basing whether or not they have kids on how the economy is doing. They just figure mom and dad will help, they will get welfare, or maybe score a deal on MTV to be on teen mom.

 

That might be a decision you regret. Live the life you dream of and make it work. Don't let others frighten you into anything else.

Regarding the original thread, the input from the WalMart CEO is another data point to consider, but I also read recently that prices at Target are now lower than WalMart on a nationwide basis. So it is also possible that WalMart is losing its edge and making excuses for it.

 

Well coleguy, you make a whole lot of sense. The path Wal-Mart has taken as a business strategy since Sam Walton's death is not likely what he had envisioned. They used to have the saying, "We buy American whenever possible", but their strategy in the past decade seems to be more like the cheapest products at any costs. I'm proud to say I haven't shopped Wal-Mart in about eight years now. The temptations were there after being laid off, underemployed, and just plain cash strapped during this recession.

 

Given I'll never make enough money to live extremely comfortably, I'd prefer to not have kids, have a nice house and car, and be able to travel. That, to me, means more than having a kid... at least at this point in my life.

 

walmart has been building stores for a while like theyre mc donalds. maybe people are tired about having the 1 for all store that kills local business. walmart is a bad influence and shouldnt be mistaken for "The Economist".

 

Not to worry, folks. Here is how it goes. At some point, I found a widget for sale cheaper at a store about twenty miles from me, so I would travel and buy it. Then, after a while, gas began rising. At length it became LESS EXPENSIVE to buy that widget at the store nearest me. Yes it cost more than when you last purchased it some months ago, but it should. Everything costs more after a while. That's called inflation, and it's because business bid up their costs by paying their employees more, and for overhead costs like lights. Then they pass the costs on. At some point, that barrel of oil WILL BE $300 DOLLARS A BARREL. It will then not be possible for the Chinese to sell us at the $100 dollar per barrel price-for anything. Even with labor costs zero. oil costs will eventually lead to a re-emergence in American manufacturing. Once we begin building state of the art plants to make the items that the Chinese are selling us, then our QUALITY improvements (a natural by-product of new manufacturing techniques) will lead other nations to buy from us. Then that huge monetary surplus in Dollars the Chinese are sitting on will be used by them to make purchases HERE to undergird their society. We will have then paid ourselves for OUR re-emergence. That's called an economic cycle, seen globally. Take a look at one statistic for support of this digression. Motor vehicle deaths. Less motor vehicle deaths than ever recorded. Even with more cars, more drivers, and more total miles. Even the Cracker Jack prize Chevy Cruz ($ 15,000 and some change) has ten air bags. You'de need to be hit by lightning during a tornado while the accident is occurring to be hurt in the Cruz. Wonderfully safe. And anyone who thinks we cannot out-manufacture any other nation in the world need only look at our production of Peeps each Easter. There ya go. We can beat them all at turning a screwdriver. Sears. K MART. Auto Zone. PEP BOYS. Ace Hardware. KFC. Burger King. The list goes on and on. We are all gonna be just fine, Made right here, in the USA.

 

Let me clarify the point that I am not defending the Walmart business model. I don't shop there very often. The original article was about how inflation will impact prices at Walmart. The CEO said "U.S. consumers face "serious" inflation in the months ahead for clothing, food and other products". He went on to say that they are working with suppliers to minimize cost push and that all industries are facing similar challenge. The article made sense to me and I thought Coleguy's post was relating to the article. If Cole's point is that Walmart's business model will cause them problems in the future I would have to defer to him, I have no insight into how well or poorly Walmart "sales" will be relative their competitors. :smile

Regards,

Bluesboy65

 

The path "Japanese radiation takes over the next two years" could also determine who has kids.

 

I understand your view, but I ask how many dual incomes are because "I have to have the latest fashions/car/computer/etc" and have nothing to do with putting food on the table and living comfortably. Or has comfortable become lavish. I think this may be a good wake up call to make people define want vs need. I personnally have no interest in keeping up with the Jones'.

Kie

 

I agree. I think WalMart is trying to change the subject and get the spotlight off of their discriminatory employment practices (and that medoraman is also onto the truth - a public appearance by any CEO like this is primarily about communicating to shareholders, not to customers).

 

You feel that a discussion of Walmart is appropriate for this thread, but that Fox news is not? Could you please explain why you feel that way, and why you are suggesting that I abridge my free speech to fit your opinions?

Then, go listen to this and tell me why you think the source of the news is unimportant:
http://www.youtube.com/watch?v=6HJTIhsQ16c

 

You must have been dropped on your head a lot as a child.

 

I've got to disagree with this old chestnut (although, I've heard other items used instead of a Colt revolver - a "fancy wool suit" seems to be the most common).

For items that we've been able to develop (especially anything involving technology, but also true to a lesser extent for related items) the buying power of gold has declined almost continuously ever since the start of the industrial revolution. Not only have we seen the cost of goods come down (ie; a six shot revolver can be found for far less than $1382 - that's 0.9675 ounces of gold at friday's spot price), but the quality of substitute goods has gone up sharply. You can buy a semi-auto pistol with a much larger capacity clip for less than $1000.

Here's a brand new Smith & Wesson revolver for just over $700 (S&W has 5 round models in the $350 price range):
http://www.smithwessonhandguns.com/...nd_Guns_Pistols_SW_164194_686_Plus_Dist_.aspx

Here's a 13 roung Glock 21 for $550:
http://www.glockworld.com/item/42548_Glock_Hand_Guns_Pistols_Glock_PI2150203_Model_21_.aspx

Both of those pistols are far less likely to explode in your hand, misfire, or have poorly aligned barrels than a brand new revolver in the 1860's, to boot.