Friday, July 4, 2008

A Dire Economic Possibility

I was thinking about some of the recent news reports about the rising cost of fuel. Gasoline and Diesel, not to mention jet fuel and other derivatives of oil we depend on. But in particular: Diesel. Much has been said about truckers, and how they're paid a sum and from that sum they buy their own fuel. Many are struggling to make ends meet as their fuel costs rise and their pay does not. The result is costs are rising across the board to recoup up the supply chain (and theoretically, back down to the trucker's salaries, don't hold your breath).

A real possibility exists with respect to continued fuel cost increases where truckers may opt out of driving for other careers or, in unionized regions: go on strike. Imagine the impact of that for a minute. As soon as the public gets word that truckers would strike, they will realize what that means for grocery stores. If you've lived in a place that is often within reach of a hurricane you know all too well what this means for grocery stores, lumber and hardware supply stores (Lowe's, Home Depot, etc), and yes, gas stations. The results are not good. People panic and will rush out to consume everything they can afford to hedge their bets on supplies running out.

If truckers were to go on strike en mass, and nothing was done to remediate that soon, the public would make a violent run on food stores, and just about anything they would fear running out of. If you have kids, especially young kids (under 12), you would be stupid to not pay attention to this since you need milk, cereal, bread, juices and so forth to keep your kids going. Most parents would gladly cut things like coffee, cigarettes, sweets and snacks, and so forth to keep their kids fed well. Imagine what people would do when they're told the basics might run out, in 24 hours, and there might not be replenishment for weeks. Not a good thought.

I'm not saying this will or would happen. Only that nobody can logically discount this as a possibility. If fuel costs continue to rise, especially Diesel, this becomes more of a probability than a potentiality. Doom and gloom obviously. Sky is falling. But show me one person that can prove they predicted two years ago we'd be paying over $4/gallon now, and I'll show you (a) a liar, or (b) a messiah descended from the heavens.
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