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Justice Dept. Makes Cheap Beer a Top Priority

Again, this is another clear indicator of the lack of understanding about economics by many in Washington. Suppose the merger went through after all, and AB InBev increased beer prices 20%, not because of rising input prices, but rather because they think they can get away with it. Consumers still have choices in the beer market. They can still switch brands, give up drinking beer, or perhaps even make their own.

This is not life or death; but perhaps reflective of a Justice Department that's had its share of controversy over the past few years and is trying to remain relevant.

There was indeed fallout from Thursday's filing: AB Inbev fell nearly 6%, while Mexico's Grupo Modelo fell 6.5%. There was also some collateral damage, as Constellation Brands (STZ - Get Report) fell 17%, the result of fear that the Department of Justice suit could hurt Constellation's efforts to acquire Modelo's stake in Crown Imports LLC, which is the U.S. importer for Corona.

Meanwhile, Boston Beer (SAM - Get Report), a great success story, and one of the only survivors from the publicly traded micro brewery craze of the 1990's, had a relatively quiet day. Boston Beer is a testament to the fact that the small guy can still make it in the beer industry.

At the time of publication, the author held no positions in any of the stocks mentioned.

This article was written by an independent contributor, separate from TheStreet's regular news coverage.
Jonathan Heller, CFA, is president of KEJ Financial Advisors, his fee-only financial planning company. Jon spent 17 years at Bloomberg Financial Markets in various roles, from 1989 until 2005. He ran Bloomberg's Equity Fundamental Research Department from 1994 until 1998, when he assumed responsibility for Bloomberg's Equity Data Research Department. In 2001, he joined Bloomberg's Publishing group as senior markets editor and writer for Bloomberg Personal Finance Magazine, and an associate editor and contributor for Bloomberg Markets Magazine. In 2005, he joined SEI Investments as director of investment communications within SEI's Investment Management Unit.

Jon is also the founder of the Cheap Stocks Web site, a site dedicated to deep-value investing. He has an undergraduate degree from Grove City College and an MBA from Rider University, where he has also served on the adjunct faculty; he is also a CFA charter holder.
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