Gasoline prices are $3.10 for regular in Philly and $3.25 in St. Paul.

And the band played on and on....

And the markets went up and up....

Consumers balked in June according to the government (-0.9%) and spent more according to Target etc. Of course food prices are up 7% year-over-year and Target sells a lot of groceries. Any connection there? Duh!

If the consumer represents 70% of economic activity and she is being taxed (equivalently) by higher energy (and food) prices and is already overly indebted how is it possible for consumer spending to do anything but stall in the near term? More borrowing could delay the inevitable - maybe for quite awhile - but the ultiomate outcome is not in doubt if energy prices stay high.

OSF
July 17, 2007

It is a sign of our times that individuals at home alone are blogging their hearts out to millions. This relationship without touch reminds me of Keats' Ode on a Grecian Urn, which describes beautiful moments painted on an urn which remain beautiful forever because they are never completed. This discipline of writing regularly into cyberspace is full of potential, and yet it can become a ritual of self reflection that speaks to no one except perhaps some future cyber-archaeologist pondering our times. My question today is who cares? It is perhaps too soon to ask. If anyone now or in the future reads this and wants to ask a question or make a comment, email me at bbingham50@gmail.com where the storage is endless and I will make an effort to sift through and respond over time. As we become more and more isolated and objective about the world we inhabit it seems we become more willing to experiment. I'm willing to continue this experiment, and I want to get a sense of some positive outcomes.

G.Benjamin Bingham
July 8, 2007

Some tentaitve answers Ben.

I think your momentum comment was spot-on as the Brits would say. The huge flow of $ into private equity pools and the "don't let the capital burn a hole in our pocket" attitude seems to be fueling the stock market rise despite weak underlying fundamentals and growing systemic risk (see sub prime kerfuffle).

Ethanol will fall away as an inefficient fuel source to be replaced by bio-mass sourced fuels and other alternatives. How else will we start the long journey toward cutting our carbon emissions by 70%?

As to the fat question I will leave it to you to launch an exploration of your nearest Mickey D's to discover the answer. Big Mac's for all?

OSF
July 5, 2007

BTW Sam, how is your car faring on biodiesel? What's your take on the ethanol syndrome (using big tractors burning fossil fuels and spreading petroleum based fertilizers, herbicides and pesticides to grow corn for ethanol!)? Why does even Obama praise its virtues? If McDonald's trucks in the UK are planning to run purely on used veggie oil will there be enough fat left to power normal citizens in the future?

G.Benjamin Bingham
July 5, 2007

Sam, maybe what we are missing is momentum…the basic law of physics that an object once moving will continue in the same direction until met by an equal and opposite force. If we think like materialists with only money in mind, growth is the only justification for happiness, so why not join the exuberance instead of being chronically pessimistic with pessimism’s inevitable self-fulfilling prophecies that would prove us right once again. Maybe it is realists that keep making bad things happen! If everything unwinds (today I read it is becoming de rigeur to borrow money to buy back stock and pay off loans and reward stockholders with dividends increasing the already high degree of leveraging) then I guess they can blame people like us!

G.Benjamin Bingham
July 2, 2007