March retail sales figures were said to have benefited from relatively mild temperatures, corporate bonus season and the early April date of Easter. We think April's data could bring a recall of investor confidence that was previously supported by continued consumer strength. Please also recall that the last meeting of the Federal Open Market Committee lit a fire under the market when perceived hawkish language was removed from the official statement. In the days that followed, Ben Bernanke was forced to speak to the issue, and his quote conflicted with the market's view, as he firmly stated that the Fed remained equally concerned about inflation. We believe this Wednesday and Friday could bring the type of data and news that conflicts with the message the market bought into about a month ago.
First of all, if March retail sales benefited from warm weather, April should have suffered from one of the coldest such periods in history. Besides weather, gasoline prices have gradually risen through the period to a current peak, thanks to tight refinery production. At the same time, other prices have continued to rise at a robust pace, including the price of the oft-excluded foods category.
Fluctuations in food prices have historical been discounted because they mostly occurred due to seasonal and weather influences. However, as we've been discussing here since early this year, the current trend is different. New uses for food, specifically corn in ethanol production, have driven up the price of foods across the horizontal field and vertical chain. As more acreage is used for corn planting, less is available for wheat and soybean production, driving up the prices of surrogate grains. Increasing costs for feed raise expenditures for protein producers, and we've seen those increases of input costs mostly transferred over to the consumer through higher beef, pork and poultry prices at the market.
While these price pressures have mounted, ARMS loans across the country are triggering adjustments of monthly payment burdens higher for many Americans. Meanwhile, the turmoil within the subprime lending sector, and increasing foreclosures and defaults have made a real impact on lending standards. Credit is getting harder to come by, and credit my friends drives American buying power. Evidence of this was provided just last week when General Motors blamed its poor results on its GMAC lending unit, in which it retains a 49% share.
All these factors make this week an especially telling one. Important credit, retail and Fed policy news will reach the market, and potentially awaken it to the likelihood of an increasingly thrifty American consumer. When the American consumer stops spending, that's when you start to see layoffs, weaker ISM data, slowing corporate earnings and recession. We have benefited for quite some time now from American ventures overseas, but American companies and the economy remain mostly driven by American expenditures. This is the basis of our thesis that the economy will weaken into recession this year.
We expect that as a result of the Fed's miscommunication last time around, it will be sure to include inflation discussion in its official statement this time. We expect no change in the benchmark rate, and the market to raise the red flag that support may not arrive in time to save the economy from falling into recession. Now, while Wall Street Greek expects Q1 GDP data to be revised upward, we also believe the economy will fall into recession this year. With poor news from the FOMC and our expectation that April retail sales will fall far short of consensus expectations for 0.4% growth, we expect the market will turn its focus to a weakening consumer, as that pillar of strength cracks.
Now, individual retailers and consumer driven companies reporting quarterly earnings should not yet show the impact of April's newly found weakness within earnings results, however, there is risk that reporting retailers could reset guidance lower based on April's weak sales. Some of the consumer driven stocks with this risk, reporting earnings this week and next, include Blue Nile (NASDAQ:NILE), Shoe Pavilian (SHOE), Rubios Restaurants (RUBO), Steak 'n Shake (SNS), Autobytel.com (NASDAQ:ABTL), California Pizza Kitchen (NASDAQ:CPKI), Carrol's Restaurant Group (NASDAQ:TAST), Cosi Inc. (NASDAQ:COSI), Urban Outfitters (NASDAQ:URBN), Fossil Inc. (NASDAQ:FOSL), Home Depot (NYSE:HD), Jack in the Box (JBX), Deb Shops (DEBS), and Kohl's (NYSE:KSS).