Separate from the role energy prices play in the risk-and-reward scenario for speculating investors, the result for Americans' lives is that energy, and the mobility that it brings, is becoming crushingly expensive.
High oil "makes us poorer than we would otherwise be," says St. Louis Federal Reserve President William Poole. "There's a hit to real income. It's a drain on your purchasing power."
How this shows up in everyday life:
•Portland, Ore., trucker Lee Klass delayed a dental operation that will cost $500 after insurance payments because of $4 diesel fuel. He can't boost his fuel surcharges fast enough to keep up with zooming diesel prices, he says. "It's impossible for a normal business to keep up with it. You just can't do it."
Many more going bankrupt
Bankruptcy filings have surged 22 percent in Massachusetts this year, as more people are unable to afford their rising mortgage payments or refinance their homes to pay bills, according to court filings and bankruptcy attorneys.
more stories like this
Lawyers, trustees, and other bankruptcy specialists said the housing crisis is the single biggest reason that personal bankruptcy filings are rising rapidly. They said homeowners with subprime and adjustable-rate mortgages who cannot make their higher payments are resorting to bankruptcy. A decline in housing values has also limited the financial flexibility of homeowners who once were able to tap their home equity to pay off car loans or mounting credit card bills.
Employers cut back on hiring
Employers in many of the world's largest economies are "taking a step back in hiring", reflecting concerns that the crisis in financial markets could spill over into other sectors, according to a survey of more than 55,000 employers.
The study, conducted in 32 countries by Manpower, one of the world's largest recruitment companies, reported that the jobs outlook in the US, one of the main engines of the global economy, was the weakest for four years.
401(k)s tapped to save homes
Struggling to save their homes from foreclosure, more Americans are raiding their 401(k) retirement accounts to pay their bills — and getting slammed with taxes and penalties in the process, according to retirement plan administrators.
Rather than borrow money from their 401(k) accounts, which would have to be paid back, a growing number of beleaguered families have been cashing out, plan administrators say.
Some Homeowners Use Arson to Avoid Foreclosure
Looking to cash in on their insurance rather than face foreclosure, some people have committed arson to avoid losing their homes.
Michigan authorities believe 38-year-old Sheryl Christman was one of those people, when she set her home ablaze Sept. 1. Christman was just three days short of foreclosure.
Good times are over, central bankers told
Life for central bankers is going to get tougher as globalisation begins to produce malign effects - pushing up prices and spreading a financial crisis across the world, monetary policy chiefs said on Friday.
Jean-Claude Trichet, the ECB president, said the recent surge in commodity and food prices "reminds us that globalisation can also lead to upside risks in world inflation".
WellPoint is dark cloud for insurers
Shares of Indianapolis-based WellPoint Inc. plunged $17.11, or 26%, to $48.72 in afternoon trading, following its announcement late Monday that it would slash profit expectations. The company cited several factors, including medical costs, lower fully insured enrollment and a weak economy (emphasis mine).
Sharing the Pain
We have always gotten a distorted picture of how well Americans were doing from politicians and the media. The U.S. has a population of 300 million. Thirty-seven million, many of them children, live in poverty. Close to 60 million are just one notch above the official poverty line. These near-poor Americans live in households with annual incomes that range from $20,000 to $40,000 for a family of four.
It is disgraceful that in a nation as wealthy as the United States, nearly a third of the people are poor or near-poor.