PrintApril 23, 2011
Gasoline and Dollars: Supply and Demand
Gasoline has exceeded or approached $5.00 per gallon in some parts of the United States long before the normal peak travel season has begun. Already the politicians, headline writers, and some cable and talk show pundits are pointing to the usual suspects. But they have avoided or are unaware of where the fault actually lies.One of the foundational tenets of economics is what is known as the law of supply and demand. Normally whenever a product or commodity is in short supply the cost to acquire it increases; on the other hand, if there is a glut on the market the price decreases. However, over the past three years, thanks to the profligate fiscal policy of the Obama administration and the Democrats in Congress combined with the money creating monetary policy of the Federal Reserve, this law has been turned on its head.There are two commodities deeply affected: the first is oil, which is a basic modern day necessity; and the second is gold, which has always...(Read Full Article)
