Here's a quote pulled from the Barron's Investor's Soapbox, taken from the Financial Commentator:
With China and India increasing the supply of labor and production, it's tough to see how inflation can really be a problem in coming years.
So oil prices are inflationary, while massive productivity gains (from huge labor supply, ability to outsource globally) are disinflationary.. Now imagine if we pit them head to head in a pushing match, and watched to see which overpowered the other. Who would win?
Well it probably depends on your time frame. Over the short-term, a spike in oil would overpower relatively slower moving productivity gains. But over the long-term, we'd like to concur with the quote above.
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