The prices companies pay for raw materials that go into their goods dropped in November, with word today the Producer Price Index has dropped 0.2 percent. This at a time that retail sales were up 0.6 percent. Marketplace's Cynthia Ingle reports from Washington. So, there's an overabundance of the stuff sitting in American warehouses. Prices go down.
Consumers get a bargain.
Retail sales go up. Good news because you can lug home cheap goodies for under the tree. But Jack Albertine, who runs an economic consulting form in Washington, says this trend toward lower prices threatens some stores. That's why there's so much price pressure. There are probably a lot of retailers that aren't going to be able to make a reasonable profit and stay in business.