Going Postal

Last week first class postage increased from 41 to 42 cents. Surprised?

Most people I talk to are unhappy but resigned about the increase. Why expect efficiency from a legally protected monopoly? Realistically, many costs have fallen. So why are rates rising?

We all know about energy prices. But that’s just a recent issue. One real answer is that the Postal Service has finally been ordered to fund its benefit packages. And mail volume isn’t growing fast enough—owing especially to email—to keep the Postal Service growing.

But as the real cost of mail rises, consumers will find alternatives. Spam used to be junk-mail. And my spam-filter works just fine. In the meantime, the Postal Service seems to be entering a death spiral of rising costs, rising prices, and lower volume.

In any case, I expect accelerating price increases going forward. Four-dollar letters, anyone?

Douglas R. Tengdin, CFA
Chief Investment Officer
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By | 2014-09-03T18:51:25+00:00 May 19th, 2008|Global Market Update|0 Comments

About the Author:

Mr. Tengdin is the Chief Investment Officer at Charter Trust Company and author of “The Global Market Update”. The audio version of each post can be heard on radio stations throughout New England every weekday. Mr. Tengdin graduated from Dartmouth College, Magna Cum Laude. He received his Master of Arts from Trinity Divinity School, Magna Cum Laude and received his Chartered Financial Analyst (CFA) designation in 1992. Mr. Tengdin has been managing investment portfolios for over 30 years, working for Bank of Boston, State Street Global Advisors, Citibank – Tunisia, and Banknorth Group. Throughout his career, Mr. Tengdin has emphasized helping clients manage their financial risks in difficult environments where they can profit from investing in diverse assets in diverse settings. - Leave a comment if you have any questions—I read them all! - And Follow me on Twitter @GlobalMarketUpd

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