Oh BTW Honey, Did You Get Gas?

If not, too bad. 25% of Libyan oil output has been shut down due to ‘difficulties’ in that country-

Gas will cost you an arm & a leg!

resulting in a 30-month high on the price of oil & a 2-day drop in the stock market of 259 points.

According to CNN Money, home prices took a big hit at the end of 2010 even as the rest of the economy gained, falling 4.1% in the last 3 months of the year. Seemingly inexplicably, Washington D.C. housing was up 4.1%. Could it be {wink, wink} that booming federal jobs market in the nation’s capital?

The cost of oil and housing are inversely related. High oil prices push everything else up. Higher heating oil or commuting costs could just be the straw that busts the camel.  As more people lose their jobs it’s bye-bye recovery. Even without this slippery oil thingy in places with funny names, the number of borrowers who owe more on their mortgages than their homes are worth took a huge leap in the fourth quarter of 2010. A full 27 percent of borrowers are now “underwater” on their mortgages, up from 23 percent in the previous quarter, according to a new report from Zillow.

As the revolutions in the Middle-East and North Africa continue and tensions between opposing Muslim sects ratchets up a few notches it could get ugly and will be a major smack-down to our already anemic economy. I think you could call it a perfect storm.

Aloha, Mikie



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