Oil companies are making money and gas prices are going up. Will the consumer revolt and stop buying gas to teach the oil companies a lesson?The implication there: “It’s the damn oil companies gouging us, let’s rally around the flag and punish them Rah! Rah! Rah!” Meanwhile Ben Bernanke slides another trillion dollars of printed money into the economy. If you look at oil and gasoline prices in terms of gold and silver prices they haven’t changed much in the last 40 years. Here is a LINK to a Forbes article that should raise your awareness level a tad.
In actuality, the purchasing power of the dollar has fallen 50 percent in the last four years, gas hasn’t doubled in price. Put another way, this was a tax on people with money in the bank; their money lost half of its purchasing power. The Democrats want to tax the rich; I think they are doing an excellent job at it right now. It now takes two billion dollars to buy what one billion bought four years ago. And of course if anyone complains, it’s those damn oil companies gouging us. Plus those rich people weren’t using that second billion anyways, so they’ll never miss it. If you’re rich and retired, just call it “Tough Love.” Our government needs those printed dollars to pay the bills when tax receipts are just not enough to cover expenditures.
Printing dollars, taxes the people with money in the bank invisibly. There are no forms to fill out, everything just costs more. The average person on the street has no concept of printed dollars creating inflation. They want to blame someone for the increased prices, and who do they point to, the supplier of the product, the bankers, and Wall Street.
Some of us know what is going on. The real evil is government printing; they are taxing those that decided to save for retirement. If you have no savings, you have lost none of your wealth. If you work, everything cost more, and without a pay raise, your standard of living suffers.
With interest rates so low, there is no incentive to save. The present increase in consumption is a common sense reflex to very poor interest rates, coupled with inflation. Why wait to buy? It will cost more later! The economy isn’t turning around; this is the last breath before the long pause and downward plunge.
Is the stock market going up because the economy is getting better, or is it because stocks are the only game left in town? There is a big surge into dividend stocks, I wonder why????
Gasoline prices just went up another 25 cents over this weekend. Will Congress do to the oil companies what they did to the Post Office (limit price hikes to inflation)? Instead of the refiners shipping half of their production overseas, they’ll ship all of it. No pay, no play.
When we tax by inflation, we do unquestionable tax the rich. But ask yourself a few questions about this hue and cry to "Tax the rich." Are there many rich people between the ages of 1 to 20? Are there a lot between the ages of 20 and 40? How about between the ages of 40 and 50? Probably most of them fall between 50 and 65 just about at the age people start to get ready for retirement. How did they get rich? They saved for a lifetime. Now Bernanke is going to punish them for being rich---zero interest on their savings and inflation beyond their wildest dreams.
Inflation is kind of like sawing a quarter inch off of grandpa’s walking cane each month. He’ll know something is not right, but he won’t have the foggiest clue as to what the problem is.