@tooltime Increasing prices is for sure what they'll do. Yet, there's a near 100% probability that each incremental increase decreases their available target market due to said rising prices. It's doubtful that salaries rise in direct proportion to vehicle price increases. For high fuel consumption vehicles (Ford makes their money from trucks), operating costs also factor in. Many things will begin to destabilize the economy in a high inflationary period. 'Cyclicals' - which are companies (automotive, for example) that are typically dependent upon steady, predictive monetary policy and low inflation - are sensitive to HIGH inflation. Consumers begin to curtail descretionary spending. When given the choice of buying food, utilities, shelter, and basic necessities - or a new vehicle - the vast majority choose to eat. It's that dramatically simple.
As the Fed tightens monetary policy to curtail inflation, interest rates rise, as this affects pretty much everything in the economy - from individual spending to the cost of corporate borrowing, it can trigger a recession. People pull back from spending, and the economy retracts. Unemployment increases, and major purchases plummet. That's why I don't want auto stocks now. But that's just my opinion.
