The Shirt on Your Back is About to Cost an Arm and a Leg

Food and gas prices are skyrocketing out of control, now your clothes are about to take a hit.  Time to start shopping at the local Goodwill store or some reasonable facsimile thereof:

Cost Pressures To Hit Wal-Mart, Target, Other Firms’ Profits
By Ed Carson – IBD
Thu., Feb. 17, 2011

Soaring cotton futures take a long time to filter down to retailers and consumers, but it’s finally happening.

[…]

Citi predicts product cost inflation of 4%-6% in apparel and 2%-4% in home goods in the first half of the year, “with inflationary pressures accelerating in 2H11 to 13%-15% in apparel and 9%-11% in home.”

Cotton futures have risen more than 150% over the past year to 150-year highs. Meanwhile, rising wages and factory constraints in China are further pushing up costs. Retailers tend to source goods months in advance, so they’ve been insulated from raw material price spikes to a great extent. But no longer.

[…]

Apparel prices jumped 1% in January, the biggest monthly gain in nearly two years.

[…]

Most retailers — and other U.S. companies outside of food and energy — are going to struggle passing on the bulk of their cost hikes to their customers, who are struggling amid still-high unemployment and sluggish wage gains.

As Strategas’ Nicolas Bohnsack noted today that “Over the next several quarters, a key dynamic will be the ability of companies to pass input cost increases on to consumers. This is likely to prove more difficult in an environment in which wage growth is restrained.”

[…]

Explore posts in the same categories: Economics, Economy, Obama Sucks

2 Comments on “The Shirt on Your Back is About to Cost an Arm and a Leg”

  1. Big Frank Says:

    All this and more under the ‘dynamic’ leadership of our all wise and wonderful ‘Dear Leader’ and his hand picked cadre of Czars or Commissars.It’s all part of the “change” we were promised. In addition to his Utopian regimes’ centralized government, out every dollar in the new Federal budget that is spent $0.42 will be borrowed our flung out of the Treasury Dept.’s printing presses, further devaluing the already sinking dollar. The only thing I can suggest is to stock up on non perishables, be frugal, eliminate as much debt as possible, and try to weather the next 2 years. I fear it will take decades if at all to repair the damage done to our great nation by these Socialist, Orwellian, New World Order Marxists.

  2. PAM SHANKLIN Says:

    WE THE PEOPLE NEED TO WAKE UP!!~!!~!! HITLER NEEDS TO BE IMPEACHED!!~!!~!!


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