economy is worse

well, some claim all I predict is gloom and doom, want drama from sad events, but the news is very bad. Turns out the economy is worse than predicted, much worse. Many retail owners are hanging by a thread. Yesterday one retail person told me that he is planning to close down his store. He cannot pay the rent and business is slow.

The one good news is that gasoline is cheap, now under a buck and a half per gallon. This means more money in the pocket of consumers, but it will not last long, the future price of fuel is up.

Future of Fuel

The price of oil finally go down below $100/barrel, but projections are that by this summer we could see gasoline at near four dollars a gallon. Detroit has long had a love affair with large automobiles, but the future is small cars are we get used to prices over $5/gal for gas.

Already in England many are paying over one pound per litre of petrol this would be the equivalent of more than $8/gal for gas. The solution is electric cars. We already have cars like the Toyota Prius plug in hybrid and soon the Chevy Volt. I see many future fuels like biodiesel and ethanol helping bridge the transition to electric cars.

Future Price of Food

As more and more food is required by an ever increasing population, its cost will go up. As the price of oil does increase so does the cost of producing and transporting food. However, something even more sinister is increasing the future price of food.

We are converting food into fuel. Corn is used to create ethanol. Soybeans areusedto createsoy biodiesil. We are burning the food for fuel. The biomass used to feed us now is also our source of fuel so there is even less food to eat.