Former Federal Reserve Chairman Alan Greenspan said on Tuesday the U.S. economy was in recession, and said it would be appropriate to tap public funds to resolve the mortgage-related crisis that has helped pull the economy under.

Retail gasoline prices pulled back slightly from record levels Tuesday and gave some consumers a small break, but a new government forecast said gas could reach as high as $4 a gallon during the summer driving season.

President Bush urged Congress on Monday to resist efforts by Democrats to pass a second economic stimulus package, saying that while the economy is “in a rough time right now,” he is confident it will begin to rebound by the end of the year.

The Federal Reserve, still working to combat the effects of a severe credit squeeze, said Tuesday it had auctioned another $50 billion to cash-strapped banks. Meanwhile, the International Monetary Fund warned that further actions are needed globally to prevent more wrenching problems.  

The free ride for American consumers is ending. For two generations, Americans have imported goods produced ever more cheaply from a succession of low-wage countries — first Japan and Korea, then China, and now increasingly places like Vietnam and India.

But mounting inflation in the developing world, especially Asia, is threatening that arrangement, and not just in China, where rising energy and labor costs have already made exports to the United States more expensive, but in the lower-cost alternatives to China, too.

“Inflation is the major threat to Asian countries,” said Jong-Wha Lee, the head of the Asian Development Bank’s office of regional economic integration.

It is also a threat to Western consumers because Asian exporters, even in very poor countries, are passing their rising costs on to customers.

Developing countries have had bouts of inflation before. Indeed, some are famous for them, like Brazil, which experienced triple-digit inflation in the late 1980s and early 1990s. But two things make this time different, and together promise to send prices higher at Wal-Mart and supermarkets alike in the United States, just as the possibility of recession looms.

First, developing countries now produce nearly half of all American imports. Second, inflation in these countries is coming at the same time that many of their currencies are rising against the dollar.

That puts American consumers in a double bind, paying at least some of producers’ higher costs for making their goods, and higher prices on top of that because the dollar buys less in those countries.

Asian businessmen say they do not have a choice about charging more. “This is a tough time to do business,” said Le Hoai Vu, the sales manager for the Quang Vinh Ceramic Company here in northern Vietnam.

The company just increased by up to 10 percent the prices it charges Pier 1 Imports in the United States for hand-painted vases because labor costs are rising 30 percent a year.

Over all, in Vietnam, one of the fastest-growing destinations for manufacturing investments and one of the fastest-growing sources of American imports, prices rose 19.4 percent from March 2007 to March 2008.

In China, Foshan Shunde Augustus Bathroom Equipment Ltd. in Foshan City is about to raise prices by 10 percent for a range of bathroom fixtures exported to North America.

“Rising inflation is a way of life in China these days, you see it everywhere,” said Faye Kong, the company’s international business supervisor.

The cost of American imports from less industrialized countries as a group is rising. A Bureau of Labor Statistics index of average prices for imports of manufactured goods from such countries fell gradually through early 2004, but is now rising briskly and was up 5.6 percent in February from the same month last year.

That contributes to rising inflation in the United States; in the 12 months through February 2008, the prices of goods for sale in the United States increased by 4 percent, according to the government’s Consumer Price Index.

The Labor Department on Friday said nonfarm employment fell by 80,000 jobs in March, more than expected and the biggest drop in five years. Financial markets saw this as reinforcing the need for further Federal Reserve interest rate cuts.  

It was the first time the U.S. economy had shed jobs for three consecutive months since a five-month string in 2003, when the economy was mired in a recovery from the 2001 recession which created few jobs.

Oil prices jumped close to 106 dollars on Friday as investor sentiment was driven by the weak US dollar, tight energy supplies and more bad news on the US economy, analysts said. 

On Friday, New York's main oil contract, light sweet crude for delivery in May, jumped 1.92 dollars to 105.75 dollars per barrel, after earlier touching 105.97. 

London's Brent North Sea crude for May rallied 1.78 dollars to 104.30 dollars. 

"Crude futures were higher as the dollar weakened," said Sucden analyst Nimit Khamar in London. The weak US currency tends to encourage demand for dollar-priced crude because it becomes cheaper for foreign buyers.

OPEC yesterday accused the U.S. of economic "mismanagement" that it said is pushing oil prices record highs and rebuffed calls to boost output, laying the blame on the Bush administration. 

The 13-nation Organization of Petroleum Exporting Countries said it would maintain current production levels because crude supplies are plentiful and demand is expected to weaken in the second quarter. 

OPEC President Chakib Khelil told reporters the global market is being affected by what he called "the mismanagement of the U.S. economy," and that America's problems were a key factor in the cartel's decision to hold off on any action. 

Khelil's comments came one day after President Bush lashed out at the organization. White House spokeswoman Dana Perino said yesterday that Bush was "disappointed" OPEC didn't do more to rein in prices, which some say are pushing the U.S. economy into recession.

RECORD prices for rice, Asia's food staple, have triggered a novel phenomenon in central Thailand - rice-rustling, with fields being stripped as they are about to be harvested. 

"I've never heard of it happening before, that people have stolen rice," said Lung Choop, who grows rice on his smallholding in Samblong village. "But it's happening now because rice is so expensive. I guess I'll have to guard my own distant fields when they're ready." 

Across Asia, high prices have prompted countries to ban exports amid fears shortages could provoke food riots. 

While prices of wheat, corn and other agricultural commodities have surged since the end of 2006, partly due to demand for biofuels, rice has held fairly steady. 

But prices for the staple food of about 2.5 billion Asians rocketed two months ago. Thai rice, the global benchmark, which was quoted at just below $US400 a tonne in January, rose to $US760 last month. 

In Chicago on Thursday, futures for May delivery hit a record on speculation that the 3 per cent annual increase in global demand for cereals will outstrip supply as governments curb exports. 

Cambodia has banned all exports for two months to ensure "food security", following the lead of Egypt, a major exporter. Vietnam, which ships 5 million tonnes each year, last week declared a 20 per cent cut in exports. 

India started the ball rolling last year. With dwindling stocks, it introduced curbs that effectively banned exports. Pakistan and China also introduced curbs.

Traders found hoarding rice while the country struggles to maintain sufficient stocks of its staple grain could be charged with economic sabotage, a crime that carries a life sentence, the justice secretary said Thursday. 

Government agents have been raiding warehouses in a hunt for unscrupulous traders and warehouse owners holding on to rice stocks amid spiraling prices and fears of a shortage, Justice Secretary Raul Gonzalez said. 

The amount of rice hoarded and the resulting effect on the country's economy would determine whether economic sabotage charges could be filed, Gonzalez told The Associated Press. . . .  

Rice prices have jumped 50 percent in the past two months on world markets and at least doubled since 2004. Experts blame rising fuel and fertilizer costs as well as the effect of disease, pests and climate change on crops. Farmers' groups have warned that prices could rise a further 40 percent in coming months.