Why are oil prices shooting through the roof lately? Well, it seems like TV pundits blame everything except the single institution that has the largest influence on what oil is traded at, and that is the Federal Reserve. Some things might cause brief spikes in the price of oil, like shortages in supply, but the main cause for gas at the pump getting more expensive over time is the Federal Reserve. The real frustrating thing is that TV pundits seem not to have a clue and have not mentioned monetary policy at all. Left or Right, the mainstream media seems totally clueless. Bill Orielly had a discussion with Lou Dobbs about oil prices and not only did the two not mention the FED once but, they don’t seem to understand basic economics either. The conversation went something like Dobbs telling O’Rielly that the oil refined in the United States is being sent overseas. Well, this should not be surprising considering that oil refining is a highly complex process that third world countries often do not have the industry to refine themselves. Therefore many countries ship their crude here and when it is refined it is shipped back overseas. This is not some kind of complex plot where oil companies are taking advantage of American customers.They are simply selling refined oil on the world market at it’s commodity price. O’Rielly seems to think that there is some kind of price fixing going on because gas is at such a similar price between different gas stations. This is pretty easy to understand when you realize that oil and gas are not consumer goods like tennis shoes. They are instead commodities like beef, gold, copper, and many other industrial products. The margins are very small when looking at any commodity because commodities by definition are homogenous, unlike two pairs of shoes that are likely very different. If you went around town trying to buy gold or silver bullion at different coin shops, you would notice that the prices are pretty similar if not almost exactly the same. Same is true for industrial metals like copper, the going rate is the going rate. Additionally, oil, gas, gold, and copper are in a world market, the price of each is nearly uniform around the world, gold costs the same in Shanghai as it does in New York. Oil, before taxes, has a very similar cost as well. The real variable here is the dollar. When the dollar loses value, the price of oil goes up. If you want someone to blame for high gas prices look no further than the Federal Reserve.
Some people might say that the government owning so much land and preventing drilling is pushing the price of oil up. This might be true to some extent, and I would agree that opening up more land for oil exploration would be a good idea but, this does not explain how a gallon of gas used to cost a dime and will now likely be five dollars by summer. The reason that gas is so high this year should be put into consideration of what the Federal Reserve’s actions have been over the last four years. The FED has pumped trillions of dollars into the economy but, this has been mostly absorbed by the big banks where they have kept the money preventing it from being pushed into the economy. We are begging to see the affects of this money as it enters the economy, for food and many other commodities have been inflated up 10% in 2011. The drive up in the stock market to 13,000 has also been a result of inflation because Wall Street is always one of the first in line for newly printed money. We are finally starting to feel the beginning of the price inflation that comes about when the Fed doubles the monetary base. If the economy shoots up to full employment we might even see ten dollar gas but, to be honest we truly do not know because monetary inflation affects different sectors of the economy in different degrees. Oil, though, is one commodity that is almost always affected by monetary inflation (so is food for that matter, interesting how neither is included in the official CPI). When oil starts going up in price for long periods of time, it is likely that we will see inflation in other areas as well.
In conclusion:
The Federal Rerserve is the most to blame for oil prices going through the roof. Someday the media might catch on to this too but, don’t hold your breath, they have been blaming everything else for 50 years.
I blog often and I seriously appreciate your information. This great article
has really peaked my interest. I will book mark your site and keep checking for new information about
once per week. I opted in for your RSS feed as well.
I blog often and I truly thank you foor yourr content.
This article has truly peaked mmy interest. I am goinmg to bookkark
your site and keep checking for new information about one a week.
I opted in for your Feed too.
반응형홈페이지제작
Very good posts, Thanks a lot.
Awesome forum posts. Kudos!
Cheers! An abundance of advice.
Thanks! Valuable information!
Thanks a lot! Great stuff.
With thanks, A lot of material.
You’ve made your stand pretty nicely!.
Amazing loads of beneficial data!
Useful data Thank you.
I have learn swveral excellent stuff here. Definitely
value bookmarking for revisiting. I surprise hhow so much attempt you put
to create the sort of wonderful informative web site.
하수구막힘
Fantastic facts Cheers!
Helpful postings, Thanks a lot!
I wkuld like to thank you for the efforts you hav putt in writing this blog.
I really hopoe tto view the same high-grade content
from you in the future as well. In fact, your creative writing
abilities has motivated me to get my own site now 😉
레플리카 쇼핑몰
The longest practice journey on the earth goes from Portugal to the place?
Hello there, I found your website by the use of Google whilst searching for a related matter,
your site got here up, it seems to be good. I’ve bookmarked it in my google bookmarks.
Hi there, simply changed into alert to your
blog thru Google, and located that it is truly informative.
I am going to be careful for brussels. I will appreciate if you
proceed this in future. A lot of other people can be benefited
from your writing. Cheers!
I am genuinely pleased to glance at this webpage posts which consists of lots of useful facts, thanks for providing such statistics.
구글기프트카드
Factor nicely regarded.!
The implication that these funds might be used for white-collar crime, resembling bribery, and even that the cash they’re being promised is being stolen from a government or royal/rich household, usually prevents the sufferer from telling others about the “transaction”, as it might contain admitting that they intended to be complicit in a global crime.
I think the adkin of this website is truly working hard in suppot of his web site,
because here every stuff iis quality based stuff.
바카라 게임 방법
This is nicely said! .
Kudos! Loads of material.
Hi folks! I just had to share my current craze – posters of Kanye West. Being a massive fan of Kanye’s music, I’ve always been drawn to his one-of-a-kind artistry.
These days, I found several stunning posters that perfectly capture his legendary artistic designs. Featuring *The College Dropout* to *My Beautiful Dark Twisted Fantasy*, these posters aren’t just incredibly eye-catching but additionally stand as a nod to Kanye’s development as an creator.
I opted to decorate my studio with multiple these pieces, and I must say that they add a fresh atmosphere to the area. Each time I see them, I’m motivated by Kanye’s brave visionary approach.
For those of you looking at purchasing some Kanye West artworks for your studio, I definitely encourage taking a look at the wide range available. There are numerous styles available, whether your taste is vibrant colors or more abstract interpretations.
The best part is that these prints serve as excellent gifts for other Kanye enthusiasts. I bought one for a friend, and they absolutely loved it. It’s a great option to extend your respect for Kanye’s genius and add a touch of his art into your space.
To sum up, if you’re into Kanye’s work, definitely look into acquiring some Kanye West posters. They are sure to infuse a original vibe to your living area and function as a constant prompt of Kanye’s unmatched musical legacy. Happy decorating, everyone!
Wow! At last I got a weblog from where I know how to truly take valuable facts regarding my study
and knowledge.
Subsequently, the FOMC authorized liquidity swap lines with additional central banks.
Thanks ffor sharing such a nic thinking, piece of writing is good, thats
why i have read it entirely
의정부치아교정
I love you blog.. very nice colors & theme. Did you design this website yourself or did you hire someon tto doo it for
you? Plz answer back as I’m looking to design my own blog and would like
to find out whwre u got this from. thank you
문화상품권 현금화