MONETARY INFLATION IN AN INDUSTRY OF ECONOMIC DEFLATION: THE CASE OF THE RAILROADS

This paper considers both the general monetary condition of continuing, widespread price increases and an industry, the railroads, in which indices from physical to financial seem neither to indicate prospects for prosperity or even for continued ability to perform a public transportation service. Railroads benefit from inflation in terms of their long-term debt at low interest, increased cash flow, betterment accounting, use of rolling stock as a tax shelter by others, and prospects for increased coal traffic. On the negative side, inflation increases both the need for capital for asset replacement and the interest paid on any new investment. It also accentuates problems of cyclical industries such as railroads and of the financially weak components of the railroad industry.

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  • Corporate Authors:

    American Society of Traffic and Transportation

    547 West Jackson Boulevard
    Chicago, IL  United States  60606
  • Authors:
    • Nelson, J R
  • Publication Date: 1980

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Filing Info

  • Accession Number: 00314907
  • Record Type: Publication
  • Files: TRIS
  • Created Date: Aug 27 1980 12:00AM