This is what I have talked about several times. We may or may not have asset price deflation but I think product inflation is now back. This is why I am not a bull on Wal Mart or even Target despite what appears to be very reasonable valuations. I think this is the new head wind that will be around for awhile for many big box retailers and the American consumer. May take awhile to work through the system but the years of decreasing prices for various goods as a result of outsourcing I think is largely over. Margin pressure may be the new norm.
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