Inflation, Labor Shortage and Supply Chain Problems Weighed on Services Sector in June

Shortages of supplies and labor slowed growth in the services sector while pushing prices higher in June, a pair of business surveys revealed Tuesday. Growth in the services sector, which accounts for over 75 percent of the U.S. economy, cooled a bit in June, separate surveys by the Institute for Supply Management and IHS Markit indicate. Despite the slowdown, growth still remains at historically high levels corresponding with the reopening of many parts of the economy and the increased willingness of consumers to “return to normal” now that mass vaccination has sent the pandemic on the retreat.

The Institute for Supply Management said its business activity index slipped to 60.1 percent from 64 percent in May. That was below the forecast for 63.3 percent.

I was at Walmart Superstore the other day and they were way under stocked. Empty meat cases, hardly any dairy, no yogurt at all. They had the same kind of storage bins at five different locations in the store. Epsom salts mostly gone. They had lots of bread and bread products.

At Costco the meat had more than doubled. I like to buy the tritips in the pouch, messy and untrimmed, but cheapest possible price anywhere. There’s usually six or seven tritips in there. The dogs love it because the fat is trimmed off and they are sitting in rapt attention the whole time. I was able to get them for 60 or 70 bucks, now they are close to 200. Same with the New York steak. I like to buy the uncut slab of meat and slice the steaks myself. It’s usually 80 or 90 bucks but now well over 200.

People who sit at home and get free money don’t understand inflation. That free money is going to be like Weimar money pretty soon. People who work have a better chance of stretching their dollars because they can spend 300 to 400 i one afternoon at Costco. People who don’t work have to shop at Walmart and Foodsco. The smaller packages cost more. Plus people who work can travel around looking for better deals.

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