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I -- -- -- -- flesh out this the gas price spike a little bit -- you said that it was a refined and a problem tell us about that.
-- -- you have refineries in the United States Stewart which are shut down for maintenance and some of that is extending out.
So there's somewhere about 8900000.
Barrels a day of refining capacity in the US.
Which is offline some of that planned and some of -- by surprise.
In addition we have had an energy policy for the last 45 years which has been backwards weak.
Try to develop natural gas but we don't convert it to fuel use quickly enough.
We are becoming more independent of energy sources but not converting it to the final consumed product.
And we have a policy about crude oil we have crude oil twenty dollars a barrel.
Lower than the world price.
And we have a US -- -- -- by law it exporting it so the combination of factors has amassed pipelines running in the wrong direction.
Gradually it's being fixed by market forces certainly not being fixed.
By politics in Washington.
David since all on January the first everybody got a tax increase in Social Security that took a lot of money out of the economy.
Since January the first who got this spike in gas prices we should take it along more money out of the economy.
They have told us that if this goes on we might go towards recession.
But -- most serious question is surely this weakens even father.
Very weak economy to begin with.
No question about that that the payroll -- 2% payroll tax took growth rates down.
Perhaps point seven point 83 quarters of a point from where they might have otherwise been.
Now we pile on.
And we take another couple ticks out of it we could have a 1% growth rate for the US economy.
In the first half of this year and even longer if there's any other type of shock.
And we have no resolution in Washington about sequester -- fiscal.
Policy we have more impasse and likely to have -- for -- you're.
Earlier stated let me ask you about back -- it 10:45 this morning President Obama goes before the cameras AE I think he's going to give us his ideas on how to avoid sequester how to avoid these big spending cuts.
Let's suppose that he's not successful.
That we cut spending 85 billion dollars between march 1 and the end of this yeah.
If you take 85 billion dollars worth of government spending out of the economy does that pushes into recession.
I don't believe 85 is enough to push -- into recession.
It's slightly weakening.
In the scheme of the size of the federal budget 85 is not very large the payroll tax is double that amount.
When you add -- gas tax so it's much more severe and it hits right into the consumption.
Personal consumption expenditure.
Of a 130.
Million working Americans I don't think the 85.
Is the issue it's an extended period and that becomes the issue if they don't resolve things.
-- total thanks for joining us -- come back again soon thank you.
Thank you Stewart --
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