Rising prices at the gas pump, combined with soaring shopping bills at the supermarket, are having a noticeable impact on the consumer’s pocketbook. But what’s worse is that higher prices in oil beget higher prices in food in the future. Here’s why. Historical economic studies tell us that energy prices have a significant impact on food prices, with 64.17% of changes in food prices explained by the movement of oil prices. But that only tells half the story. As energy prices climb, inputs to farm production are also impacted. Fertilizers, for example, account for between 33% to 44 % of…
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Tag: high oil prices
Markets grind ever higher
The S&P 500 Index is up 14% so far this year. Most other averages have similar double-digit gains. July is normally a fairly positive month (in general) for equities. Does that mean we can expect equities to continue their bull run through the summer? It certainly looks that way. Any pullbacks in stocks will likely be met by dip buyers. That could limit declines to a manageable level. A sustained rise in interest rates will likely wait until investors know—with certainty—the Fed’s next move. The thinking is that there will be an announcement on tapering bond purchases, which may not…