Food & Gas Prices May Cause a New Recession


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‘Customer Growth Partners’ is a company that offers consultation to fortune 500 companies to assist them with strategies in marketing, customer service, and increasing productivity.  Their clients include Morgan Stanley, Goldman Sachs, Capitol One, China Investment Company, and ING USA to name a few.  They offer insight into the economy and have recently cited rising food and gas prices as a precursor to another recession.

Currently gas prices hover around $4.00 a gallon for regular unleaded, and food has seen a 6.5% increase since January of 2011, according to Customer Growth Partners.  Craig Johnson, President of the group believes that these two essentials for living are taking up 15% of consumer spending.  That is up from 12.7% a few years ago.

Mr. Johnson feels that the “Double Whammy” will hurt consumers, especially in the lower income brackets where the percentages of spending on energy and food are higher.  These two necessities for life are inextricably linked; farm equipment is run on fossil fuels as well as the trucks that transport the goods from place to place.  The increased cost of fuel is the major component behind the increased cost of food.  Due to the waning availability of fossil fuels and continued aggression and instability in the oil producing nations speculation in the market could cause fuel prices to continue to spike.

 

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About Scott Humphrey

An evolving person, writer, teacher, learner, activist, comedian, actor, photographer, musician, and fun seeker.

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