Hey Bill Frist, What Does 3.8 Tell You?

I see from Drudge this morning that Sausage Factory Shop Foreman Bill Frist has called for an investigation into high oil prices. Aside from the facts that 1) this has already been done, 2) would be expensive, and 3) would tell us what we already know, it would be entirely unnecessary. The third quarter GDP numbers are out and, despite numerous predictions of oil-price induced weakness, the economy sped ahead at a 3.8% growth rate. So all the Q3 pessimists were wrong when they predicted over and over and over that high energy prices would derail the economy as high gas prices crimped consumer spending. How many headlines did you read that went something like "Pain at the Pump Hurts Outlook" or "Oil Threat to Fragile Economy". Right, tons. Yeah well, the economy didn't get the memo. So what are the Q4 pessimists honing in on as the cause of the inevitable economic crackup? High oil prices. Naturally. Although this time, it will be home heating oil. High gas prices didn't derail consumer spending but high heating oil prices SURELY will. Joe Sixpack may have cancelled a road trip or two to pay for that iPod but no way will he wear a friggin' sweater around the house to get that flat panel TV for Christmas. No bloody way can he react with such sensitivity to price signals. Fat chance. He's toast. He'll have to pay for the damn heating oil, suck it up, and go without. The headlines that we will be barraged with over the coming weeks will read "Cold Weather Brings Sticker Shock to Homeheaters" or "Economy May Struggle to Stay Warm this Winter".

And the economy won't get the memo. 3.5-4.0% GDP growth in Q4.