The surge of crude oil beyond $100 a barrel has prompted the International Monetary Fund to downgrade U.S. output projections, warning of a significant erosion in consumer purchasing power. While policymakers often label such energy shocks as "temporary," middle-class households lack the debt-issuance tools of sovereign states or the cost-passing abilities of corporations. Instead, these families absorb price volatility through cash flow and credit. With consumer spending accounting for nearly 70% of GDP, the solvency of the American household remains the primary engine of the economy.
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Source · Fortune
