[Bejemoelemymn]

After spending trillions to try and get us out of a recession causing this cool jobless recovery we have, it seems we are headed rigth back into one.

The combination of rising gasoline prices and the steepest increase in the cost of food in a generation is threatening to push the US economy into a recession, according to Craig Johnson, president of Customer Growth Partners.



Johnson looks at the percentage of income consumers are spending on gasoline and food as a way of gauging how consumers will fare when energy prices spike.

With gas prices now standing at about $3.90 a gallon, energy costs have now passed 6 percent of spending—a level that Johnson says is a "tipping point" for consumers.

"Energy is not quite as essential as food and water, but is a necessity in today's economy, and when gasoline costs more than bottled water—like now—then it takes a huge bite out of disposable spending," he said, in a research note.

Of the six US recessions since 1970, all but the "9-11 year 2001 recession" have been linked to—of not triggered by—energy prices that crossed the 6 percent of personal consumption expenditures, he said. (During the shallow 2001 recession, energy prices had risen to about 5 percent of spending, which is higher than the long-term 4 percent share.)

What may make matters worse this time around, is there has been a steep increase in food prices that occurred as well. In other recent recessions food costs were benign, at between 7.5 percent and 7.8 percent of spending.

This year food prices have climbed 6.5 percent since the beginning of early January, according to Consumer Growth Partners.

"The combined increase in the necessities of food and energy creates a harsh double whammy for already stressed consumers," Johnson said. The last time this happened was in the recession that lasted from 1973 to 1975.

Johnson estimates that food and energy eat up about 15 percent of consumer spending at today's prices, compared with about 12.7 percent two years ago.

Of course, at lower income levels, these percentages are much higher. One sign of the stress some consumers are already feeling is that some AAA offices have already seen an increase in out-of-gas service calls, as motorists try to put off filling their tanks or drive around trying to seek out the gas station with the least expensive price.

Also some regions are being hit harder than others. Gas prices in Hawaii continue to set new highs, according to AAA data. The average price on Wednesday was $4.51, topping the prior record of $4.50 for a gallon of regular unleaded set in July 2008.

News Headlines -

[irrawnWab]

I suppose this is starting to look a little bit like the Carter era.

It is worth noting, however, that Obama has little to no control over gas prices. The best that I guess we could do would involve more drilling and refining, but our current refineries are already operating at about peak capacity, and getting a new refinery up and running takes several years.

[tq4F7YKs]

No President can provide policies which will allow us to recover from the mistakes of Clinton and Bush. Recession / crap economy will remain with us for many years. How do you replace 40-50 million jobs ... with sound bites?

[amehoubFomo]

ahoy all,

i think CSA be correct that the recovery, as it be so often called, be in much peril if gas prices continue to rise.

then again, perhaps thar be a silver linin', fer as the price 'o gas continues to spike upwards, perhaps R&D on alternative energy shall find the wind at its back.

aye.

- MeadHallPirate

[toopyimport]

then again, perhaps thar be a silver linin', fer as the price 'o gas continues to spike upwards, perhaps R&D on alternative energy shall find the wind at its back.

Recessions hit and R&D gets slashed in a lot of firms. Unless of course there is a big fat government bribe to go along with it.

[Bejemoelemymn]

I suppose this is starting to look a little bit like the Carter era.

It is worth noting, however, that Obama has little to no control over gas prices. The best that I guess we could do would involve more drilling and refining, but our current refineries are already operating at about peak capacity, and getting a new refinery up and running takes several years.

He could have not attacked libya... that is what is causing the biggest job the last month...

[Bejemoelemymn]

No President can provide policies which will allow us to recover from the mistakes of Clinton and Bush. Recession / crap economy will remain with us for many years. How do you replace 40-50 million jobs ... with sound bites?

what does what is happening today with Obama invading libya, and providing a jobless recovery have to do with Bush or Clinton?

Seriously, do you think Obama has doen a wonderful job? Really?

[Peertantyb]

I suppose this is starting to look a little bit like the Carter era.

It is worth noting, however, that Obama has little to no control over gas prices. The best that I guess we could do would involve more drilling and refining, but our current refineries are already operating at about peak capacity, and getting a new refinery up and running takes several years.

The hell he doesn't, have you ever heard of "drill baby drill" Obama is in the "stop drilling baby" mode.

Refineries are not a problem and if need be build more.

This off limits drilling policy here at home is all the Dem's doing. And has prices stay they will pay a price at the voting booths. The Pubs are going to really beat up the Dem's on this issue.

[Peertantyb]

ahoy all,

i think CSA be correct that the recovery, as it be so often called, be in much peril if gas prices continue to rise.

then again, perhaps thar be a silver linin', fer as the price 'o gas continues to spike upwards, perhaps R&D on alternative energy shall find the wind at its back.

aye.

- MeadHallPirate

You liberals are fixed in la la land, the only way to be more energy independent is "drill baby drill" but you liberals would rather send 500+ billion a yr to foreign to buy their oil and the jobs that go with it.

Windmills and solar do what? Produce electricity and what do power plants use to make electrical energy, coal and natural gas. So tell me how in the hell is windmills and solar going to reduce our dependence on oil?

How are you going to power our ships and boats, highway trucks, plains, trains, farm equipment, delivery trucks, cars, suv's, motorcycles, they burn oil, not windmills or solar.

Obama and the Dem's keep our economy at risk because they feel oil is evil and this windmill and solar is nothing but a big subsidy sham.

[amehoubFomo]

Recessions hit and R&D gets slashed in a lot of firms. Unless of course there is a big fat government bribe to go along with it.

ahoy JDJarvis,

aye, thats true too, 'course.

yet each fiscal calamity hath its own eddies and currents, and if it be the price 'o oil that pushed our vessel below seawater, ye never know...

thar be heaps and heaps 'o monies sittin' idle, waitin' fer an opportunity, and gas creepin' past 4 dollars per gallon, makin' full headway to 5 dollars per gallon may be just the impetus needed fer renewed investment in just such a venture.

at any rate, imma hopeful.

- MeadHallPirate

[irrawnWab]

The hell he doesn't, have you ever heard of "drill baby drill" Obama is in the "stop drilling baby" mode.

Refineries are not a problem and if need be build more.

This off limits drilling policy here at home is all the Dem's doing. And has prices stay they will pay a price at the voting booths. The Pubs are going to really beat up the Dem's on this issue.

As I mentioned, more drilling and refining would help keep oil prices lower over the long term, but again, getting a new refinery running at full capacity would require a lead time of several years.

Because of the aforementioned refineries we already have that are at basically 100% capacity, no meaningful difference can be made with regard to altering our available oil supply within anything less than even the total possible years Obama could remain in office.

I can agree with CSA that not invading Libya might have helped, but then again, a large part of what drives oil prices isn't war but rather speculation.

I suppose Obama could opt to heavily regulate speculation, but I know you guys wouldn't support that.

[Nmoitmzr]

I suppose this is starting to look a little bit like the Carter era.

It is worth noting, however, that Obama has little to no control over gas prices. The best that I guess we could do would involve more drilling and refining, but our current refineries are already operating at about peak capacity, and getting a new refinery up and running takes several years.

Obama has no problem with rising gas prices--in fact he is on record for stating he wouldn't mind $5.00 per gallon gasoline. There's a reason for it--his wind and solar policies. He LOATHES the oil and natural gas industry--and his reaction to the Gulf--couldn't make that more than clear.

Let's just hope he doesn't use taxpayer dollars for more "nonsense" subsidies for people wanting to get a new car. This man is an economic moron--and YES higher gasoline prices will put this economy on it's knees.

[Peertantyb]

As I mentioned, more drilling and refining would help keep oil prices lower over the long term, but again, getting a new refinery running at full capacity would require a lead time of several years.

Because of the aforementioned refineries we already have that are at basically 100% capacity, no meaningful difference can be made with regard to altering our available oil supply within anything less than even the total possible years Obama could remain in office.

I can agree with CSA that not invading Libya might have helped, but then again, a large part of what drives oil prices isn't war but rather speculation.

I suppose Obama could opt to heavily regulate speculation, but I know you guys wouldn't support that.

Our refineries provide our needs what is not provided is our own oil. And every time this subject comes up, it's the same old excuse it will take years to build or do anything. Hell if we moved 10 yrs we would not be in this crises. But to a liberal oil is evil.

Now I love speculators they tell us of our future problems. Just like the S&P moving our credit to a negative. But of course you would like government to be in control of price fixing. The problem is our government could not control the price of oil as it is traded on the world market.

Just the announcement of drilling in ANWAR and offshore and elsewhere would create confidence and the price of oil would drop overnight. Further we would be bringing our 500 billion now sent offshore back home and all the jobs that go with it. This would create a boom for this country. But again to the Dem's oil is evil. And their answer is windmills and solar that are doing nothing to reduce our need for oil. Not a single drop.

[Shootohoist]

The problem is not technical, uh, and the problem is not mastery of the legislative intricacies of Washington. The problem is, uh, can you get the American people to say, “This is really important,” and force their representatives to do the right thing? That requires mobilizing a citizenry. That requires them understanding what is at stake. Uh, and climate change is a great example.

You know, when I was asked earlier about the issue of coal, uh, you know — Under my plan of a cap and trade system, electricity rates would necessarily skyrocket. Even regardless of what I say about whether coal is good or bad. Because I’m capping greenhouse gases, coal power plants, you know, natural gas, you name it — whatever the plants were, whatever the industry was, uh, they would have to retrofit their operations. That will cost money. They will pass that money on to consumers.

[tq4F7YKs]

What's more important to recession? 4.00 a gal fuel or 40-50 million moved to China?

[urbalatte]

What's more important to recession? 4.00 a gal fuel or 40-50 million moved to China?

Gas. Affects more people.

The 40-50 million moved to China just makes it last.

[Noilemaillilm]

Our refineries provide our needs what is not provided is our own oil. And every time this subject comes up, it's the same old excuse it will take years to build or do anything. Hell if we moved 10 yrs we would not be in this crises. But to a liberal oil is evil.

Now I love speculators they tell us of our future problems. Just like the S&P moving our credit to a negative. But of course you would like government to be in control of price fixing. The problem is our government could not control the price of oil as it is traded on the world market.

Just the announcement of drilling in ANWAR and offshore and elsewhere would create confidence and the price of oil would drop overnight. Further we would be bringing our 500 billion now sent offshore back home and all the jobs that go with it. This would create a boom for this country. But again to the Dem's oil is evil. And their answer is windmills and solar that are doing nothing to reduce our need for oil. Not a single drop.

We have less refining capacity today than we did when Carter was president.
It makes it far more profitable for the oil companies, every time there is a refinery outage, they get to raise the price.
Announcing we are going to drill in ANWAR wouldn't move the price of oil a nickel, there isn't that much oil in ANWAR.

This country needs to be rebuilt, too much of it's infrastructure is designed to burn a lot of oil. We need to get over the fact that we aren't an oil rich nation, were are a user, not a supplier, and the thing that every user nation must do, is to tax oil heavily, to encourage alternatives.
And it will require the government to lead, and to spend on infrastructure, or to be the big loser in global economics with the most energy inefficient infrastructure to go along with the most inefficient health care system.

[Nmoitmzr]

As I mentioned, more drilling and refining would help keep oil prices lower over the long term, but again, getting a new refinery running at full capacity would require a lead time of several years.

Because of the aforementioned refineries we already have that are at basically 100% capacity, no meaningful difference can be made with regard to altering our available oil supply within anything less than even the total possible years Obama could remain in office.

I can agree with CSA that not invading Libya might have helped, but then again, a large part of what drives oil prices isn't war but rather speculation.

I suppose Obama could opt to heavily regulate speculation, but I know you guys wouldn't support that.

getting a new refinery running at full capacity would require a lead time of several years. Do you know how many times that has been repeated "several years ago"-

[Nmoitmzr]

We have less refining capacity today than we did when Carter was president.
It makes it far more profitable for the oil companies, every time there is a refinery outage, they get to raise the price.
Announcing we are going to drill in ANWAR wouldn't move the price of oil a nickel, there isn't that much oil in ANWAR.

This country needs to be rebuilt, too much of it's infrastructure is designed to burn a lot of oil. We need to get over the fact that we aren't an oil rich nation, were are a user, not a supplier, and the thing that every user nation must do, is to tax oil heavily, to encourage alternatives.
And it will require the government to lead, and to spend on infrastructure, or to be the big loser in global economics with the most energy inefficient infrastructure to go along with the most inefficient health care system.

Announcing we are going to drill in ANWAR wouldn't move the price of oil a nickel, there isn't that much oil in ANWAR. Why don't we drill in Anwar and find out how much oil is there? You're using talking points from the left.

The point is--this country will NEVER be completely energy independent--we will ALWAYS need oil. Wind and solar alone is not going to power this country.

Our electric utility companies are mostly oil--natural gas and coal fired. That's how the lights turn on across this country.

This is how Obama works. Make it miserable for the American public--then subsidize the auto industry in his cash for clunkers program--with taxpayer dollars--and then find out that most of the new cars that were subsidized were manufactured by foreign auto makers--

Then the icing on the cake: Changing the electric grid. Experts in the field stated they needed 110 billion out of the so-called economic stimulus bill to complete it--and they only got 11 billion. Then we sent 20 billion dollars to China out of the stimulus bill so they could build wind turbines for us.

You voted for it--you got it.

[tq4F7YKs]

After spending trillions to try and get us out of a recession causing this cool jobless recovery we have, it seems we are headed rigth back into one.


I'll go back to j o b s. They provide a tax base. They provide a lack of need for social support.
Create j o b s.
I'll say you have 40 Billion dollars to start any industry in the US. What will you do to create jobs that don't compete with the low income wages of China and Mexico.
You can't compete.
You have a trained workforce
You have infrastructure.
You have proximity to a large market.


Your Obama ... Failure
Your a republican ... Failure
Your White, Black, Indian, Oriental, or God ... ehhhhh you fail.

Your protectionest / tariffist ... sucess.