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Feb 27 - Gasoline Prices Are Not Rising, the Dollar Is Falling


 Feb 27 - Gasoline Prices Are Not Rising, the Dollar Is Falling
topic by chirpflare - 02-27-2012, 12:53 AM - Boxden > BX Daily Bugle - news and headlines


Panic is in the air as gasoline prices move above $4.00 per gallon. Politicians and pundits are rounding up the usual suspects, looking for someone or something to blame for this latest outrage to middle class family budgets. In a rare display of bipartisanship, President Obama and Speaker of the House John Boehner are both wringing their hands over the prospect of seeing their newly extended Social Security tax cut gobbled up by rising gasoline costs.

Unfortunately, the talking heads that are trying to explain the reasons for high oil prices are missing one tiny detail. Oil prices aren’t high right now. In fact, they are unusually low. Gasoline prices would have to rise by another $0.65 to $0.75 per gallon from where they are now just to be “normal”. And, because gasoline prices are low right now, it is very likely that they are going to go up more—perhaps a lot more.

$6 Gas?

What the politicians, analysts, and pundits are missing is that prices are ratios. Gasoline prices reflect crude oil prices, so let’s use West Texas Intermediate (WTI) crude oil to illustrate this crucial point.

As this is written, West Texas Intermediate crude oil (WTI) is trading at $105.88/bbl. All this means is that the market value of a barrel of WTI is 105.88 times the market value of “the dollar”. It is also true that WTI is trading at €79.95/bbl, ¥8,439.69/barrel, and £67.13/bbl. In all of these cases, the market value of WTI is the same. What is different in each case is the value of the monetary unit (euros, yen, and British pounds, respectively) being used to calculate the ratio that expresses the price.

In terms of judging whether the price of WTI is high or low, here is the price that truly matters: 0.0602 ounces of gold per barrel (which can be written as Au0.0602/bbl). What this number means is that, right now, a barrel of WTI has the same market value as 0.0602 ounces of gold.

During the 493 months since January 1, 1971, the price of WTI has averaged Au0.0732/bbl. It has been higher than that during 225 of those months and lower than that during 268 of those months. Plotted as a graph, the line representing the price of a barrel of oil in terms of gold has crossed the horizontal line representing the long-term average price (Au0.0732/bbl) 29 times.

At Au0.0602/bbl, today’s WTI price is only 82% of its average over the past 41+ years. a$suming that gold prices remained at today’s $1,759.30/oz, WTI prices would have to rise by about 22%, to $128.86/bbl, in order to reach their long-term average in terms of gold. As mentioned earlier, such an increase would drive up retail gasoline prices by somewhere between $0.65 and $0.75 per gallon.

At this point, we can be certain that, unless gold prices come down, gasoline prices are going to go up—by a lot. And, because the dollar is currently a floating, undefined, fiat currency, there is no inherent limit to how far the price of gold in dollars can rise, and therefore no ultimate ceiling on gasoline prices.

Gasoline Prices Are Not Rising, the Dollar Is Falling - Forbes


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62 comments for "Feb 27 - Gasoline Prices Are Not Rising, the Dollar Is Falling"


 02-27-2012, 12:55 AMaway - #2
Andrefrbk 782 heat pts782

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Well yeah that too.
 02-27-2012, 01:16 AMonline - #3
stogz 9 heat pts

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Oil is over $100 a barrel.... i think it gained everyday last week. It's the highest it's been in about 9 months.... THAT'S what you call "rising" prices.
 02-27-2012, 02:32 AMaway - #4
Armen87 117 heat pts117

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cheapest in LA is 4.25 now lol. #### is gonna be 6 dollars by summer. good thing i fixed up my bikes
 02-27-2012, 10:54 AMaway - #5
CMONEY 

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Makes perfect sense. Inevitable when you just try to solve your debt problems by printing more and more money to make it seem like things are getting better.
 02-27-2012, 10:58 AMaway - #6
dbullet878 5 heat pts

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Originally Posted by CMONEY
Makes perfect sense. Inevitable when you just try to solve your debt problems by printing more and more money to make it seem like things are getting better.
 02-27-2012, 01:35 PMaway - #7
Andrefrbk 782 heat pts782

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its amazing that the collapse is actually going to happen, i cant believe all these analyst predicted this.

I have not been prepping for the collapse. I dont have the food, armory, or gold for this collapse. I think we have basically till the end of the year.

Gas prices is basically the beginning. We are a consumer based economy, people need to buy crap. If all people can afford is gas to go to work etc. No one will be buying shiit.

Once food stamps go, its pretty much over for 80% of the country. Mass riots etc. I really dont know what im going to do, im freaking out big time. Im not prepared, and the events that are leading to the collapse are escalating quickly.

My biggest fear is that in the next month or two, gas will not be able for purchase in the dollar, and will be a demand for GOLD. Or yuan etc.

Something is seriously wrong!

The year we export the most amount of crude oil, we have a insanely high increase in gas. This serves as evidence that hyper inflation is rearing its ugly head. By next week you can expect food prices to go up sharply. And by the summer when gas is over $5 i dont know how the avg American will be able to feed their families.

Last edited by Andrefrbk; 02-27-2012 at 01:42 PM..
 02-27-2012, 01:44 PMaway - #8
SpyDa 154 heat pts154

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gas up to 3.69 down here
 02-27-2012, 01:55 PMaway - #9
dEtroitJUNKIE 

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Originally Posted by Andrefrbk
its amazing that the collapse is actually going to happen, i cant believe all these analyst predicted this.

I have not been prepping for the collapse. I dont have the food, armory, or gold for this collapse. I think we have basically till the end of the year.

Gas prices is basically the beginning. We are a consumer based economy, people need to buy crap. If all people can afford is gas to go to work etc. No one will be buying shiit.

Once food stamps go, its pretty much over for 80% of the country. Mass riots etc. I really dont know what im going to do, im freaking out big time. Im not prepared, and the events that are leading to the collapse are escalating quickly.

My biggest fear is that in the next month or two, gas will not be able for purchase in the dollar, and will be a demand for GOLD. Or yuan etc.

Something is seriously wrong!

The year we export the most amount of crude oil, we have a insanely high increase in gas. This serves as evidence that hyper inflation is rearing its ugly head. By next week you can expect food prices to go up sharply. And by the summer when gas is over $5 i dont know how the avg American will be able to feed their families.

ITs sad how many people dont know these things but can tell you who is trending on twitter, the lastest bs gossip on mediatakeout. tmz, reality shows etc.

I will be preparing by summer and just hope that its not as bad as it looks it will be when the collapse happens.
 02-27-2012, 01:56 PMaway - #10
matelyan 17 heat pts17

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Originally Posted by Andrefrbk
its amazing that the collapse is actually going to happen, i cant believe all these analyst predicted this.

I have not been prepping for the collapse. I dont have the food, armory, or gold for this collapse. I think we have basically till the end of the year.

Gas prices is basically the beginning. We are a consumer based economy, people need to buy crap. If all people can afford is gas to go to work etc. No one will be buying shiit.

Once food stamps go, its pretty much over for 80% of the country. Mass riots etc. I really dont know what im going to do, im freaking out big time. Im not prepared, and the events that are leading to the collapse are escalating quickly.

My biggest fear is that in the next month or two, gas will not be able for purchase in the dollar, and will be a demand for GOLD. Or yuan etc.

Something is seriously wrong!

The year we export the most amount of crude oil, we have a insanely high increase in gas. This serves as evidence that hyper inflation is rearing its ugly head. By next week you can expect food prices to go up sharply. And by the summer when gas is over $5 i dont know how the avg American will be able to feed their families.
I have started to stock up on canned goods and water. And though I don't have any gold, I am hoping my brass (ammunition) will help me out even moreso going forward. Oh how the mighty have fallen.
 02-27-2012, 02:03 PMaway - #11
Andrefrbk 782 heat pts782

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Originally Posted by dEtroitJUNKIE
ITs sad how many people dont know these things but can tell you who is trending on twitter, the lastest bs gossip on mediatakeout. tmz, reality shows etc.

I will be preparing by summer and just hope that its not as bad as it looks it will be when the collapse happens.
I just called my mother and told her that id like to start prepping with our family. And she still doesnt understand whats coming...

Ive watched 2 amazing great depression videos. I know exactly what a depression and economic collapse looks like. This is it. History repeating its self. Its unreal how the events are unfolding.

NYC where i live isnt exactly a friendly place to live when #### hits the fan. There will be a lot of crime, and you will have to f!ght to live through the last stages of the collapse. Ima try to get as much food and water as possible. Start preparing for the possibilities of having to defend the house and my family from intruders and looters. I dont need to go into detail, but yall know.

I kept denying the collapse, i listen to dudes like Gerald Celente, i read the trends journal, so i know the deal. But i didnt want to believe it would happen so soon as they predicted.

2012 is the year the American dollar tips hard.

edit...

In some weird way im actually looking forward to the collapse, because i want these big businesses to fail. I want the banks to fuking perish. Id like for America to start over with a fresh fix, not a band aid. Raise the interest rates, and let the ni##as have to sell their 8th Ferrari...




Last edited by Andrefrbk; 02-27-2012 at 02:15 PM..
 02-27-2012, 02:41 PMaway - #12
Dos-effect 20 heat pts20

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Originally Posted by dEtroitJUNKIE
ITs sad how many people dont know these things but can tell you who is trending on twitter, the lastest bs gossip on mediatakeout. tmz, reality shows etc.

I will be preparing by summer and just hope that its not as bad as it looks it will be when the collapse happens.
Really? This country will never collapse.........its the center of the world...........if it ever happen the world will collaspe with it...which means that all these rich pricks and pussies will go down with it........We and they will never let that happen.......I dont know why people keep thinking that MONEY is a breathing entity its not.......we make it, control it, and inflate it...........stop giving this piece of paper power like its god, its nothing with out us
 02-27-2012, 03:03 PMaway - #13
factorx3 2 heat pts

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Originally Posted by Andrefrbk
Well yeah that too.
its not good, at the end of the day, the dollar falling is even worse than gas being $6. i want my dollar to be stronger than the gas to be that high
 02-27-2012, 03:13 PMaway - #14
bongt0ker420 

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Originally Posted by CMONEY
Makes perfect sense. Inevitable when you just try to solve your debt problems by printing more and more money to make it seem like things are getting better.
apparently we didnt learn from germany after WWI
 02-27-2012, 04:02 PMaway - #15
Y.G. 22 heat pts22

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Andre is a dumbass and so is anyone else in here co-signing him. 2 months from now paying for gas with yuan?
 02-27-2012, 04:19 PMaway - #16
matelyan 17 heat pts17

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Originally Posted by Universal Mind
His account of things is the one which right wing extremist types like to push. The whole fear mongering thing. Things are not going to get that bad. In fact, it's really not bad right now. Aside from new home sales and gas prices, every other part of the economy is picking up. The media is just hyping things up like usual. Even oil prices won't continue to rise at the rate they've been rising. It's all based on speculation. Hell, oil fell $2 today.
Very true. A lot of this is fear mongering, but I still like to be prepared for the worst, despite my gut telling me it will never come. And when the world doesn't end, I usually have a surplus of canned goods that I donate to charities for November and December food drives. But I won't be building any bunkers just yet.
 02-27-2012, 04:27 PMaway - #17
wtr1906 30 heat pts30

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once again, BX ni##as living in fear because of some video they watched.....get off the internet and go read a book, go outside and take a walk. Stop letting these BS media outlets scare you
 02-27-2012, 05:51 PMonline - #18
notoriousthugzz 33 heat pts33

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Originally Posted by Y.G.
Andre is a dumbass and so is anyone else in here co-signing him. 2 months from now paying for gas with yuan?
haha I was thinking the same ####.

It's one thing to be prepared but these dudes are some straight tin foil hat wearing mother####ers.

andre is a know #### tho so i dont know why anyone is shocked.

this dude literally lives on this site.. ####in sad

You ####s are just as bad as the people doing nothing
 02-27-2012, 06:03 PMaway - #19
SoFresh170 23 heat pts23

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this is truly devastating. i dont know what to do. and it sucks that their isnt much i can do to make things better. too many idiots in this country.
 02-27-2012, 06:13 PMaway - #20
Sammyboi22 

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Alright to all of these pepole talkin about collapse. Yeah the economy might collapse but it doesn't meant were going to be thrown into post apocalypse conditions. There are plenty of countries around the world with #### economies.
 
 


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