Fifty Bucks For A Pepsi May Be A Bargain

Good Morning Gentle Readers,

The DeLorean leaves the skyway. Sign in the background says.....

Phoenix : Boston : London

and underneath

Local traffic: Hill Valley exit next right.

After leaving the skyway it passes a floating sign.....

Welcome to Hill Valley. Goldie Wilson II Mayor. A Nice Place To Live.

Please fly safely. Ejection Seats Save Lives

The DeLorean descends down into Hill Valley. Cut to an alleyway, where the DeLorean lands. Discarded piles of laser discs and a "Fusion Industries" generator are in the background. Doc opens the DeLorean doors.

Doc: In exactly 2 minutes, you go round the corner into the Cafe 80's.

Marty: Cafe 80's?

Doc: It's one of those nostalgia places, but not done very well. Go in and order a Pepsi.

Doc pulls a $50 note from his trousers.

Doc: (continued) Here's a Fifty. And wait for a guy named Griff.

While Marty's fifty dollar Pepsi Perfect is clever bit of commentary on monetary inflation in 2015, it also may be a bit more prescient than the directors imagined  when the Back to the Future II script was penned back in the late 1980's.

For starters, from Brian S. Wesbury, Chief Economist and Robert Stein, CFA, Senior Economist at First Trust LP, who were recently seen waving a caution flag at the deflationistas at the Fed.....

In the first two months of 2009, consumer prices are up at a 4.1% annual rate while producer prices are up at a 5.8% rate.

Whole piece here.

That should come as no surprise to anyone. Pumping trillions of new dollars into the economy will inflict distortions upon the market, one of which will be rising inflation. The question is not if, but when will we feel it and how much will it be.

 

Payable to the Bearer on Demand

TWC has already noticed upticks in wine prices that don't seem to be connected to rising demand. Several spot checks reveal twenty percent bumps in price just since the fall of 2008. Not Zogby, but instructive nonetheless.

As Always,

TWC

Tip of the glass to Del Mar Dave