Sign of the times: $.99 says they can't sell for under a buck!

While Larry Kudlow and the rest of the neo-con Kudlowites are telling you the economy is Goldilocks, reality is trying to remind us that things aren't so golden.

Sure oil is now almost at under $100, and that gas in some places now cost less than a discounted haircut. The grain complex has come off its seasonal highs, with the talk of a "crash." Hell, even the price of homes has come down to the point where folks are beginning to say the end of this deflation could end soon!

Yet, in light of all this, the general consensus is that prices in general are still on the upside. Costs across the board are still going up. And today, one of the hallmarks of cheap goods is now saying they can't even live up to their name's sake!

Another squeeze by the Boa Constrictor economy

(hat tip to taonow: I've stolen your analogy)

A while ago, in a diary entitled Are Hard Times near? The Great Decline in interest rates is ending I pointed out that the great decline in interest rates that began in 1981 looked like it was coming to an end, and with it American consumers' ability to refinance debt at lower rates. I noted that if consumers could no longer refinance at better terms, and if their wages weren't growing, the engine of the American economy would stall, not just for a short time, but for a very long period -- What I have called "The Slow Motion Bust."

With oil prices at $126 a barrel, and $4 a gallon gasoline, the boa constrictor of higher prices has tightened around the average American's budgetary breathing space some more. A look at how much and how consumers are coping, below.