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Strategies & Market Trends : The Epic American Credit and Bond Bubble Laboratory -- Ignore unavailable to you. Want to Upgrade?

To: ild who wrote (58478)	4/17/2006 3:45:01 PM
From: CalculatedRisk	Read Replies (1) \| Respond to of 110194

Instead of a recession, consumers borrowed to maintain their lifestyle - and the result was a negative savings rate for most of 2005. Perhaps many people thought high energy prices would be a short duration problem - and borrowing makes sense to bridge a short term problem. Now, especially with the housing slump and the home "ATM" running down, consumers might actually be impacted by high energy prices. I noticed Dr. Roubini thinks there will be a bigger impact this year (if $70 holds): rgemonitor.com Of course this is a demand driven price increase vs. the supply driven shocks of the '70s, so its possible that it would take an even higher price to impact US consumers.