time to panic? gas $4 a gallon by spring.

[stephendare]

http://www.nytimes.com/2008/02/27/business/27gas.html?_r=1&ex=1361768400&en=8a2b6290700f2783&ei=5088&partner=rssnyt&emc=rss&oref=slogin

Gasoline prices, which for months lagged behind the big run-up in the price of oil, are suddenly rising quickly, with some experts saying they could approach $4 a gallon by spring. Diesel is hitting new records daily, and oil settled at a record high of $100.88 a barrel on Tuesday.

The increases could not come at a worse time for the economy. With growth slowing, energy increases that were once easily absorbed by consumers are now more likely to act as a drag on household budgets, leaving people with less money to spend elsewhere. These costs could worsen the nation’s economic woes, piling a fresh energy shock on top of the turmoil in credit and housing.

“The effect of high oil prices today could be the difference between having a recession and not having a recession,” said Kenneth S. Rogoff, a Harvard economist.

The depth of the nation’s economic problems became clearer Tuesday with the release of figures showing that prices at the producer level rose 1 percent in January from December, driven in large measure by energy costs. Compared with a year ago, prices were up 7.4 percent, the worst producer price inflation in the United States since 1981.

Other new figures showed that home prices around the country are falling at an accelerating pace, suggesting no end is in sight for the housing slump.

[thelakelander]

Don't worry, we'll have a billion dollar BRT system fully operational and up and running in 17 years.  Just hold on, help is on the way.

[Driven1]

nope...time to buy commodities & make $$ off the situation

[gatorback]

The problem is the falling dollar.  Um, I don't think Nature has produced anything that has fallen faster then our greenback.  Oh wait, Bush's ratings.  haha

[Driven1]

nope...time to buy commodities & make $$ off the situation

no shit, driven.

gold and commodities.

wheat futures are brilliant in fact.

myself?  a fan of cotton.  only so much farming acreage and corn, soybeans and wheat have pushed out cotton over the last few years.  but the global population and industrial booms in china & india call for more of it - over 1.6 billion living in hot, humid conditions (they aren't wearing wool or polyester).  and that is all that needs to be said.

[Driven1]

ps - don't panic, get a bike.

[gatorback]

I have a bike.  I bought it at the Goodwill Store for $17.00.  It's a Schwinn.  I put a basket on it for $14.00 but, I use it to ride across the street to work.  I'm a huge fan of the Goodwill.  Gosh, I'm going "Freegan".  Oprah did a show on it today.

[Lunican]

Is it time to panic? When the president doesn't read the newspaper... probably.

When taking the question about the $4 milestone, Bush told the reporter, "That's interesting. I hadn't heard that."

http://money.cnn.com/2008/02/28/news/economy/bush_energy_policy/index.htm

[Midway ®]

Is it time to panic? When the president doesn't read the newspaper... probably.

When taking the question about the $4 milestone, Bush told the reporter, "That's interesting. I hadn't heard that."

http://money.cnn.com/2008/02/28/news/economy/bush_energy_policy/index.htm

Why would it be helpful to read the newspaper when you receive all necessary information via divine intervention.

[second_pancake]

I agree with the bike and the commodities suggestions.  Unfortunately, this type of situation only affects the mid to lower class.  The rich will move to Europe before the dollar is impacted anymore, and they'll continue to throw money into their gas-guzzling Hummers.  You'll be able to differentiate those that only imitated the rich from the actual rich very soon.  The wannabes will be the ones riding the top of the line carbon fiber race bikes and claiming they're riding for their health while their Range Rovers sit in the drive, lol.

[gradco2004]

I want one of these:

www.smartusa.com

[gatorback]

Range Rovers don't sit in driveways.  They fall apart in driveways, on the interstate, in the park...just about anywhere you can take a Range Rover--they fall apart. This I know all to well.

[mtraininjax]

Oil goes over 101 a barrel today and its not news worthy. Maybe we need 150 a barrel, a new president who will take over Iraq for oil and get us a return on the 80 billion we spend in Iraq every 6 months. 

[RiversideGator]

This is being partially driven by market speculation in commodities much like the net stock bubble and the real estate bubble.  All of these clowns buying gold, for example, as if it were a real investment, like stock in an actual company, drive up the price.  If you look at other commodities which are less commonly traded, there prices are not up nearly as much in percentage terms.  The dollar being weak right now is a problem but I believe that the feds should and might intervene to put an end to the currency speculation.  The same sort of speculative fever has driven the dollar down.  The fundamentals for the US economy long term are very strong so the dollar cannot stay down for long.  And, there is no shortage of the commodities in question so the run up in prices is simply not sustainable.  So, the dollar will be back and the commodity prices will also come crashing down to earth before too long too. 

[Midway ®]

Perhaps it is not so much the price of commodities rising as the value of the dollar falling, thus each devalued dollar is buying less of that particular commodity, whose value is remaining more constant from the standpoint of other currencies (i.e. the Euro, which is also "rising in cost" relative to the dollar?