When Will Gas Prices Stop?

Gas prices for regular unleaded in San Diego has surpassed the $3 mark. Even though California does not get its oil from the Gulf area, Californians will share the pain. I suppose the Big Oil companies will spread its costs all throughout the US. Transporting goods continue to remain costly, and those costs will likely pass through to the consumer. Inflation is knocking on the door. I'm not sure how much impact Katrina will have on our economy, but it will definitely slow our economy. Here's a doomsday prediction that I wouldn't like to see. If our economy halts its growth and prices continue to rise, we may enter stagflationary conditions. Greenspan has some tough decisions ahead. September fed fund rate prices jumped to 96.43 suggesting now that a September hike is less than 80%. Whether or not the Fed decides to raise rates in September, making moves (in either direction) beyond that may harm the economy.