We've found that the current economic crisis has so many negative components that it justifies a new term: Vorteconomics. Defined as spiraling, high-speed economic change in which fixed economic conditions cannot keep up with those rapidly spiraling conditions.

To be more clear, rapidly rising fuel costs are, like a tornado, swallowing up everything that has pricing flexibility, such as food, transportation, clothing and those consumables which are frequent purchases by consumers. More fixed goods, such as automobiles, household appliances, and other large purchase items. Such fixed prices are usually inventory items which are less affected by today's fuel prices and are, as a result, less likely to be subject to price increases due to fuel costs.

The vortex comes from the fact that fuel costs are not necessarily rising on speculation or due to high use, foreign price fixing or other external forces. Rather, fuel costs are rising in large part due to the devaluation of the US Dollar. That spiral seems, like a tornado, to be a destructive, and unstoppable and destructive storm which must dissipate on its own and cannot be controlled.

The Dollar is devaluing from a number of factors, and ironically, from the price of fuel, each factor feeding the other. Real estate values, a core of US economic valuation, are dropping at alarming speed, and the public is cutting back on spending. Other factors contributing are high rates of default. Bankruptcies are rising rapidly, and the public is failing to pay bills to creditors in alarming number.

The business credit crunch is having an extremely negative impact on the economy. Without the ability to borrow, businesses are having a very tough time paying bills and staff and are failing, defaulting on taxes due to the states in which they operate. The states, depending on corporate franchise taxes, are in fact losing so much money that they're now looking for new tax revenues to make up for shortfalls.

As prices and other costs of living rise, individual income is not keeping pace, making it more difficult for the average citizen and consumer to keep pace with the vortex of price rises. Companies are having an equally difficult time. Airlines, for example, like Delta, posting more than $6 Billion in losses, largely the result of fuel price increases. The airlines cannot price tickets based on fuel cost compared to aircraft occupancy, so they are subsidizing the cost of empty seats.  Because the ticket prices remain fixed until another fuel surcharge can be implemented, airlines lose money.

Shippers, on the other hand, can pass along fuel costs quickly, raising the price of shipped products, including essential consumables like food and beverage items. As daily consumables rise in price, the cost of living rises accordingly, and these cost increases mean that consumers must prioritize whether to feed their family or pay bills. Naturally, there's not much choice in the matter.

Vorteconomics is an interesting dynamic, as it is self-perpetuating. It will eventually run its course, and will resolve, however, many factors in the economy must change, the key to all of them being solid economic reform and the resolution of the mortgage and business lending crises.