Ouroboros

AP: Fed: High energy, food prices keep economy weak

The Fed's new snapshot of business conditions, released Wednesday in Washington, underscored two big sore spots for the country: listless economic activity coupled with high energy and food prices. Those rising prices carry the risk of both spreading inflation and putting another drag on overall economic growth.

Chafing under price hikes, "consumer spending slowed ... as incomes were pinched by rising energy and food prices," the Fed said. Manufacturing activity, meanwhile, was "generally soft" and the housing market remained stuck in a rut.

The cycle begins:

- Price of fuel rises
- Price of raw materials rise because the shipping expenses are now more
- The product is now more expensive because the manufacturer is passing their rising costs onto the consumer
- The consumer has less money because their fuel and food are more expensive and so there is less consumer spending
- Its presently called an economic slowdown. It doesn't really matter what you call it , the stock market is dropping.

Summing up - everything is more expensive, people have less money, there's less business.

Probably there is some kind of formula for determining when you call this stagflation.

Nobody wants to call it that. The political spin on the present and future situation continues as well. Those favoring Bush policy will play the economic problems down.

Those opposed to Bush, and those with a better political vision, will report the facts.

The media continues to mindlessly entertain, divert people's attention, and rarely does it connect the dots which got us into this mess, which also favors those in agreement with Bush policy.