Saturday, April 23, 2011

The Price of Gasoline

gas pricesThink I was kidding about the value of the dollar and the price of gasoline? From The Market Ticker, the chart is the price of oil, and the white line is the value of the dollar.

Having the dollar at a low value could be really good for us if we were an exporting nation, as we used to be. We used to manufacture and export cars and trucks, televisions, refrigerators, washing machines, machine tools, steel, aluminum, computers... A low dollar made those things more competetive overseas. Now we import them from abroad, and a low dollar makes them more expensive here.

We used to be a net exporter of oil. In fact, within my lifetime we were the world's largest exporter of oil. Now we are the world's largest importer of oil, and a low dollar is making that oil very costly.

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