surcharge/precursor of INFLATION

[JIMRPT@AOL.COM]

In a message dated 3/08/2000 6:59:45 PM, you wrote:

<<I thought inflation was the result of excess paper money which devalues the

currency unit. What I stated was rising costs, which someone eventually has

to pay.>>

et al;
 Inflation, and it's origins, is one of the many things that economists don't 
agree on even more so than piano techs don't agree on some very basic 
fundementals!! :-)

Basically inflation falls into one of the following broad categories:

"A 'persistent' increase in the level of consumer prices" 
or 
"a 'persistent' decline in the purchasing power of money, caused by an 
increase in available currency and credit beyond the proportion of available 
goods and services."

  The commonality in these is "persistent". A momentary blip in the price of 
gasoline or oil does not in and of itself create inflation. However the 
reaction to this 'blip' may create inflationary moves....such a move would be 
to charge a "surcharge" on tuning fees and this would be 'our' contirbution 
to inflationary pressures. Of course we all should charge what is needful for 
us to earn a living and remain competitive in the marketplace. 
However.......everytime we increase our prices, for whatever reason, we are 
adding to the inflationary pressures in the economy at large. This is not 
needfully a 'bad' thing particularly when there is viable economic 
justification for passing on new costs, funding new goals or just keeping up 
with the times/cost of living.

  The mere printing of paper money does not cause inflation, it is the use 
and ease, or difficulty, of acquiring that money that leads to either 
'inflation' or 'deflation'. Harken back to the days of the oil "shortage" of 
the 70's when interests rates were high before the oil "shortage" was foisted 
upon the world by OPEC and the reaction of the economy was immediate and in 
many ways devestating.......now compared to the relative low interests rates 
in todays economy there should not be the reaction from the economy that 
would cause equally devestating results.................hopefully :-)

  In summation  if you feel needful of raising prices due to the current oil 
fiasco then by all means do so, but don't list it on your 
bill.............that is unless you list your utilities, rent, insurance, 
etc. as separate lines also :-) Increase by the amount you feel justifiable 
to yourself and your customers and go on about your business and life.

My view.
Jim Bryant (FL)