Wednesday, November 02, 2005

Scott Burns predicts a recession

And I believe him. Together with the imminent collapse of the housing bubble, we're going to see some tough times:

... Skeptics should consider this brief list:

•The rising cost of gasoline. With the typical household consuming about 1,000 gallons a year, an increase from $1.50 a gallon to $3 meant a purchasing-power loss of $1,500.

•Rate increases for electricity and natural gas.

•Rising medical co-pays and other out-of-pocket expenses for health care, plus rising employee health insurance premium costs. Premium costs were up 10 percent in 2004 alone.

Another way to see the same thing is to examine wage gains.

In 2004, the average weekly earnings of private nonagricultural workers rose only 2.2 percent. The consumer price index rose 3.3 percent over the same period.
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