Besides what Spenumatsa has stated, the increase in costs for the goods (esp. necessities) and fuel means less money (in the consumers' pocket) leftover to buy other things, which again, hurts the economy. The prices of these goods go up because petroleum is an input cost and also required to ship the item to the store. I watch Nightly Business Report every weekday and they go over this all the time. We discussed this a bit at http://priuschat.com/forums/freds-h...cted-hit-220-barrel-summer-2.html#post1271857.
^Yeah I get all that but I disagree. True economic recovery is not a function of microeconomics and consumer spending/consumer confidence. So what if it costs more for groceries. We'll still eat and we'll still pay.
At this moment there is a real risk the recovery will stall due to the housing market. If fuel prices also skyrocket right now it would deal a severe blow to the economy.
There was a story on the local news about an auction of abandoned houses to reduce the 9% of hhouses currently sitting empty. These houses are causing downward pressure on the market. The thinking here is that getting these houses occupied will help revitalize the market
^^ I heard that too. But doesn't this method of taking some of the housing inventory off the market, also take a nearly equal inventory of buyers out of the market?
The UK economy is pretty strong, and our fuel is mega expensive. our goods are also expensive, but we still buy them. Try these examples for size: Loaf of bread: $2.08 Big Mac(just the burger): $3.67 US Gallon of milk: $5.25
I am sure that lifted trucks are responsible for more injuries than excessively quiet EV vehicles. Those things should absolutely be banned from the road and have a demonstrable habit of riding over whatever they hit when in an accident. Everything gets more expensive. Well maybe so. There has obviously been no economic recovery in the US anyway. It's a debt-laced "recovery" with deficit filling in the gap. This is structural debt. This week saw on CNN something like 18/20 of the housing markets they looked at are down year over year. Phoenix led the charge with 9.1% dip. Just in the past year! Man, they are still crashing! UK economy is a cluster #*%(, as it is in the US. Austerity measures are coming on you like a ton of bricks because you've pulled down untenable debt & deficits and now you're going to have to dig out of it. Like the US, it's been debt-based growth predicated on consumer borrowing, not real. The US will follow soon enough, though.
But this is like saying New York State is doing OK but what does that matter if the rest of the US is up a certain creek? If you include the UK in Europe you'll see we've got lots of sick Countries in Europe who have paddled themselves right up that certain creek and lost their paddles! But I hear what you're saying about costs, but then again I think the high cost of fuel is stalling our economy. Things were improving before petrol went up but I lost significant business almost overnight when oil went up - people need petrol to get to work, but they don't need a night out and a cab home.
Even if gas prices skyrocket to $6/gallon tomorrow, all the existing monster SUVs on the road (and those currently sitting on dealer lots) won't disappear overnight. They will be around for a long while yet. While a petrol shock is the last thing our fragile economy needs right now, we should implement a long term strategy to reduce the demand for these bloated and inefficient vehicles. Unfortunately, it doesn't look like there's enough political will to make that happen.
+1 Silly me, I thought record unemployment with forcasts of it going higher was a negative BBC News - UK unemployment total hits 17-year high The US is doing worse right now than the UK. The debt crisis is still hanging over the European economy as are high oil prices.
Survey: uh hugh . . . rightly, they folks that put this together could have called their result: Marketing - It works. Tell people they'll be more macho ... more sexy ... more safe ... more cool ... more popular, and ignorance WILL rear its ugly head. It's the Emperor's New Cloths, revisited. Nothing new to see here.
Latest unemployment numbers suggest economy is on the upside a little bit. Could lead to higher fuel prices.
zenMachine I am skeptical. I believe less than 50% of all these government reports. I have family members that should be eligible, that no longer collect unemployment, but still do not have a job. That skews the statistics in a "favorable" political direction. This week I spent several days looking at homes in the southern part of my state. No deals to be found; high prices; high demand. It has more to do with geography (people want to flee cold, dreary northern clines and move south). Anytime you average places like Detroit with other viable cities, the conslusions will be invalid. OTOH, those of you that do not live along the border with Mexico have no concept of the devistation that has occurred to these communities .... and has invalidated every statistic regarding education, criminal activity, the economy, welfare, and on and on.
that is one way to look at it, but the other is that auctions allow people who would normally not qualify due to income levels to get into the market which increases the # of buyers. as soon as the "low hanging fruit" is gone, then the market can increase prices since they wont have that low ball competition now the other drawback is the auction process which can bid prices back up to market level. but at least this inventory, most of which is not on the market, gets to move to make room for the houses that are on the market
Skepticism is healthy, but only to a certain extent. At some point consumers need to have faith and confidence in the future. The job market will not rebound unless businesses can sense hope and optimism to start hiring again. It's a catch-22.
