Seeking Alpha
  • David White
    QE by the Fed might temporarily push SBUX stock up, but it would also push commodity prices up. This would hurt SBUX more.
    7/26/12
    Reply (12)
    • Bret Kenwell: Yes, but it will help the Oil conglomerates. As well as any commodity bulls.
      7/26/12
    • Bret Kenwell: Fed needs a way to provide stimulus/promote growth without significantly raising commodity prices, as they hurt American Consumers.
      7/26/12
    • David White: I agree. I wish I knew how they might do that. I can't think of a good way offhand. QE1 was primarily to fight "deflation". That worked.
      7/26/12
    • Bret Kenwell: I know it is a tough battle and tough goal. Providing QE without effecting the dollar is something that will be hard.
      7/26/12
    • David White: Oh I think they want the USD to go down. It's the US gets hurts badly when oil goes up because it runs such a large oil trade deficit.
      7/26/12
    • David White: Any money we pay out to import oil is money that goes to stimulate economies other than the US economy. Roughly double+ the effect.
      7/26/12
    • Bret Kenwell: Well that's the hard part. QE will usually drive the prices of things like oil up. With Oil and gas costing more it pinches consumers who
      7/26/12
    • Bret Kenwell: don't have much left to be pinched. Puts American Economy on a hurtful squeeze.
      7/26/12
    • David White: It's not just that it pinches consumers. It literally moves money out of the US economy. It is in effect negative stimulus. A $250 oil trade
      7/26/12
    • David White: Correction $250B oil trade deficit. This money all flows out of the economy.
      7/26/12
    • Bret Kenwell: exactly. We need to create jobs, period. We can't create jobs while soaking more money out of the economy and into someone else's.
      7/26/12
    • Bret Kenwell: Essentially we need to "create" a new/another industry. Where jobs will be plentiful and money will stay in our own economy.
      7/26/12