Monday, February 13, 2012

Gas prices soar on dollar devaluation even as consumption drops to 10-year lows

One of the biggest misnomers in finance and economics today is that prices work according to supply and demand.  This was true when America performed in actual capitalist system, but since we moved to both fascism and crony capitalism, where corporations, banks, and government all work together at the betterment of themselves and not society, prices are fixed due to other factors such as dollar devaluation.

U.S. drivers used 2.8 percent less motor gasoline last year and consumed the smallest amount since 1999, the U.S. Department of Energy said Wednesday. Officials credited the decrease to more fuel-efficient cars and an aging population taking few trips.
Meanwhile, U.S. domestic oil production increased by more than 2 percent last year to 5.6 million barrels per day. – Des Moines Register
So... if consumption is way down, and production is actually up, should not gasoline prices be falling?  They should, except if you take into consideration the amount of money printing and currency devaluation being done by the Federal Reserve over the past four years, the amount of  inflation is being created by our own banking system, and not by a lack of products, or by higher demand.

In the end, Americans are being deceived by Fed Chairman Ben Bernanke.

Bernanke said that for now, the Fed expects overall U.S. inflation to remain low, and that the Fed is being “extremely vigilant” to make sure it does not wait too long before tightening money policy. He dismissed GOP questions about inflation worldwide, saying it is occurring in emerging markets, not the United States. – The Hill

1 comments:

We are in a global market. Not to mention printing presses are out in force which devalues more But remember oil also is used in other products textiles plastics etc. China and India's demand for crude oil has also increased. Demand is up around the world while our's is down. We still need to drill.

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