1. America's inflation problem becomes evident.
Yes, the intelligentsia fears deflation above all, but for this space, the comment on inflation is this: Just ask China. Whether it be food or clothing, costs are already on the rise—around the world. Talk to people who shop every day. From horse feed to waffles, they'll tell you their wallets are lighter, and they're surprised about all the deflation talk.
2. Retailers will struggle to pass along costs to the consumer
The U.S. still has a huge problem with unemployment. If you have a struggling consumer and incredible retail competition, it's going to be very difficult for companies to raise prices to offset a spike in costs.
3. More consolidation is on the way in the consumer goods space.
If there's no pricing power right now, then companies might need to grow through acquisition. Might a Kellogg orGeneral Mills be in play. That's pure speculation, but more than one dealmaker has brought up the cereal names.
4. Kraft under pressure with CEO Irene Rosenfeld on the hotseat.
Speaking of growth through acquisition, the honeymoon is over forKraft'sacquisition of Cadbury in 2011. If the sales numbers aren't impressive, expect pressure to mount on CEO Irene Rosenfeld.
5. Johnson & Johnson's makes a comeback
Their children's medicine is returning to store shelves, and simply from a comparative standpoint, Johnson & Johnson could be poised to show a sharp rebound. Of course, this assumes the company gets back the business lost to the embarassing recalls, and that no further problems arise. If so, year-over-year revenue and profit numbers could shine in 2011.