Economy expected to slow significantly; gas hits $5 a gallon in CA!

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Wall St. selloff continues…
By Paul LaMonica, CNN Money Editor
November 8, 2007

In testimony before Congress’ joint economic committee, Federal Reserve Chairman Ben Bernanke says the central bank is concerned about credit crunch and rising oil prices.

NEW YORK ( — Federal Reserve Chairman Ben Bernanke, warning that higher inflation and weaker economic growth could be in store, told Congress Thursday that the central bank is keeping a close eye on the subprime mortgage crisis and recent spike in oil prices.

Bernanke, testifying before Congress’ Joint Economic Committee, said in written testimony that since the Fed last met on Oct. 30-31 and decided to cut interest rates, “financial market volatility and strains have persisted.”

“Incoming information on the performance of mortgage-related assets has intensified investors’ concerns about credit market developments and the implications of the downturn in the housing market for economic growth,” Bernanke said in his prepared remarks.

He also expressed concern that the rise in energy prices – oil is now trading at about $97 a barrel – could lead to both higher inflation and weaker levels of economic growth.

“In addition, further sharp increases in crude oil prices have put renewed upward pressure on inflation, and may impose further restraint on economic activity.”…

Link to article here.

Gas Prices Hit $4 In California

KSBW-TV, Monterey
November 7, 2007

SACRAMENTO, Calif. – The American Automobile Association of California says some drivers are now paying $4 a gallon for regular unleaded gasoline. Crude oil prices hit an all-time high Wednesday, above $98 a barrel and analysts say with worldwide oil demand rising — it is still not clear just how high prices will go. In Salinas, AAA recorded an average of $3.39 per gallon. Santa Cruz is at an average of $3.37 per gallon.

KSBW checked and found gas in Gorda, south of Big Sur, is even higher. Drivers there are paying $5 for gas. Over the past two weeks gas has gone up 15 cents in California alone, according to AAA.