Read this story and try not to get angry...http://money.aol.com/article/oil-prices-gain-to-above-74-on-recovery/635636
Now explain to me how oil prices can go up when there is less demand, so much in storage that they are leasing oil tankers to store it and unemployment in this country is on its way to 10%?
Oil is used as a hedge against inflation. But if oil rises, it makes inflation inevitable. Higher oil leads to higher gas prices and everything in this country is transported by truck, ship or plane--things with large diesel engines. Forgot to mention trains. Therefore the price of everything goes up which in turn leads to less spending. Less consumer spending leads to lower production and eventually those employees get laid off. Unemployed people do not spend and the whole cycle feeds on itself.
The worst part of all this is that we cannot blame OPEC for once. These are our own people doing this to us.
America voted for change last November but this seems like more of the same. Oil and the commodities markets need regulation. I remember during the first Gulf War back in 1991 that oil prices remained the same even though Saddam Hussein was blowing up oil wells in Kuwait. The market was also regulated. The statutes for regulation of these markets expired in 2002. Bush let it expire and Obama does not seem interested in doing anything to rectify the problem.
Aren't you glad you voted for change?
No comments:
Post a Comment