CNN: Will Katrina lead to higher prices?

[garybeck]

Will Katrina lead to higher prices?
While investors fret about a slowdown, some economists think inflation is a more worrisome threat.
September 8, 2005: 11:47 AM EDT
By Paul R. La Monica, CNN/Money senior writer



NEW YORK (CNN/Money) - Will the aftermath of Hurricane Katrina send the economy into a slowdown or will it lead to higher inflation -- or both?

With oil and gasoline hovering not far from record highs, many economists are concerned about an energy-price induced soft patch. To that end, there have been increased calls for the Federal Reserve to pause when it meets on Sept. 20 instead of raising interest rates for the 11th consecutive time.

But some say that the spike in gas prices and other disruptions following Katrina could lead to upward pressure on prices across the economy as well. So even if the Fed doesn't boost short-term rates at its next meeting, it may resume later in the year in a bid to ensure that inflation remains in check.

http://money.cnn.com/2005/09/08/news/economy/katrina_inflation/index.htm

[leftylady]

1. Of Course It Will

And once they are up there they don't come down again. Its called the gouge game.

[phantom power]

2. You can't have $3/gallon gasoline without major inflation.

It may take a certain amount of time to work it's way thru the economic food chain, but it's as unavoidable as gravity.

[bemildred]

3. "energy-price induced soft patch"

More valium-based news to snooze with.

[Kelvin Mace]

4. Yes.

Next question...

[disconnected]

5. oh wow i'll be surprised if prices don't go up

I expect to be feeding my family of 6 on beans and cornbread here sooner or later...
1 day til payday and I just put the gas reserved for my lawnmower into my car so I could pick up my kids at school. Seriously.

[0007]

6. Most all will take advanage . . .tough times are here for the poor

[cmd]

7. a hangnail leads to higher prices

Give a corporation an inch, they take a mile. Profit is their core belief.

[Danmel]

8. Of course it will

Aside from fuel, the barges can't get through, crops are ruined,I imagine shrimp, and oysters and other gulf fish will be adversely affected if not by the storm itself, by the polluted filthy water now flowing back into Lake Pontchatrain and the Gulf, demand for construction materials will drive up the prices of plywood, lumber, stainless steel. I pp