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Gas Prices: Why Your Outrage Is Misplaced

It seems that Americans are enraged – yet again (sarcasm intended) – with the price of gasoline.

Is this outrage justified?

Not when you take a few things into consideration.



#1 – Gas prices are at the levels they were in the late spring/early summer of 2008. (Graph 1)

#2 – Inflation has spiked tremendously since the same time in 2008 – when gas prices went even higher.  Thus the reason that gas prices dipped in 2008, and have climbed since then in conjunction with the inflation rates. (Graph 2)

#3 - Oil is currently trading about 34% lower than its all time nominal high set in July of 2008 (Graph 3)

#4 - Declining retail inventories will (and have?) help setup the perfect storm for massive price inflation across the board (Graph 4)


Again, Is this outrage justified?  No, because the American people are outraged at the wrong people.  Rather than being outraged at the oil companies and oil producers, the outrage needs to be on those who control the money supply – The Federal Reserve.

Instead of President Obama talking about releasing oil from the US Reserves, he should be talking about – and pressuring Congress for – the need for monetary reform in the United States.

…given the data, that’s where I believe the outrage should be pointed.



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  1. WillofLa says:

    And if I could just find that damn number I have. It’s the telephone number you call if you suspect a gas station is price gouging! And that is exactly what that station is doing, and that is price gouging!! You know damn well it doesn’t cost that much. Report him for price gouging, or don’t buy gas from him.

    Remember this people, “The price is whatever the market will bear.” That means that if a sucker can be found who will pay $5.00 a gallon, THAT’S WHAT THE PRICE IS!! DON’T DO IT, OR WE WILL BE SEEING $6.00 THEN $7.00, THEN $8.00 AND SO ON. IF YOU DUMB AMERICANS WILL NOT PAY MORE THAN THE NATIONAL AVERAGE WHICH RIGHT NOW IS $3.60 A GALLON YOU CAN MAKE THAT BASTARD DROP HIS PRICE, OR GO OUT OF BUSINESS!! DON’T LET HIM FORCE YOU TO PAY, IT’S A TRICK!! DON’T BE A SUCKER!!!!

  2. WillofLa says:

    Oh, then since to understand the issue of who we need to be outraged with is the Congress’ lack of monetary reform, here, let me go get my Masters in Banking & Finance and run right back here and contact my representative and tell him what he needs to do. And that’s the big part of the problem and that is, with some stuff we just don’t know what to say. He is supposed to know about that kind of stuff, not me. Like, as in, we’re supposed to tell our Congressman what to do and he works for the constituents, sorta.

    Do you think that if someone hadn’t had their head up their butt that somebody could have taken Barney Franks out of his long enough to find out what he’s done to everything so that we wouldn’t be having these kinds of problems by now, since he’s been in charge of the Banking committee forever! Without his expertise we would have been on the road to economic prosperity by now, yeah, right.

    Monetary reform? You can bet we wouldn’t get any cooporation from the Democrats on reform because they’d be telling us how we couldn’t do this and couldn’t do that because it cut into the money that is needed for this program and that program. So there wouldn’t be any money for the banks even if government could help. But if you ask me I do blame the damn oil companies because they are telling everyone right now that there is an abundance of gasoline, so much so that they have to get rid of it there’s so much of it. They’re selling it to foreign countries there’s so much. Why doesn’t the President tell the oil companies to release the gasoline to the distributor’s so it can end up at the gas stations and drop the price to $2.50 a gallon? Wouldn’t that help while the Congress is working on reform?

    And if you don’t think the oil companies could keep up with demand, how do you think they got all that gas just from what little American’s haven’t used by slowing their driving down. Believe me, they could keep up at $2.50 a gallon. The same oil companies were keeping up with it when it was $2.50 a gallon back when Bush was President weren’t they??

    No, it’s Obama the Alinskyite Communist with his head stuck up the butts of the environmentalists who support him!!

    • TJ Thompson says:

      You don’t need a Masters in Banking & Finance to understand the situation – we learned this in our elementary school lunchrooms.

      If you were the only kid who brought a cookie, you could trade that one cookie for something really good. But if suddenly half of the kids brought a cookie, you couldn’t get as much as you did when cookies were in lower supply.

      Yes, I know it is a very simplistic analogy, but it illustrates the fact that inflation is a very basic concept – yet politicians and financiers have convoluted the idea to make it APPEAR difficult to understand.

      We are not even getting cooperation from Republicans on this issue. The parties are in unison on this front.

      And oil companies will do what they have to do in order to make money – even if that means exporting gasoline. Businesses exist to make money. Period. The President can tell the oil companies anything he wants, but they don’t have to listen, because the POTUS has no authority over them. They will continue doing whatever they have to do to make money.

  3. Winghunter says:

    1) LA just reported $5 p/gal gas and we can expect over $6 by summer.

    2) Gas prices dipped in 2008 through the expectation of availability by Bush opening all coastlines to drilling. When inflation hits from the $6.5 Trillion Obama has spent with the intent to bring our country down, we’ll see gas prices over $10 p/gal just as Steven Chu and Obama has wanted all along, “Somehow we have to figure out how to boost the price of gasoline to the levels in Europe.” (Dept. of Energy Steve Chu, September 2008)

    3) Barrel price will climb by Comrade Obama’s efforts.

    4) US oil companies have been shipping out surplus retail inventories to foreign countries who are paying a higher price per gallon.

    Exxon finds a Billion barrels of oil & Obama pulls their permit http://t.co/W2umzkc

    8/2008 Thanks To Three American Senators, China Will Be Pumping Iraqi Oil http://www.liveleak.com/view?i=1d7_1221673374

    Obama Administration Approving Only 35 Percent of Gulf Drilling Plans http://bit.ly/sxV16V

    Federal judge holds Obama administration in contempt over drilling “permitorium” http://bit.ly/hzGreo

    • TJ Thompson says:

      Agree that the $6.5 Trillion spent under Obama and a worthless Congress will cause an inflation spike. However, the REAL inflation knockout-blow will hit from the over $16 TRILLION that the Federal Reserve created and gave out to banks over the last 3-5 years.

      This is causing prices to surge across the board – gas, bread, meat, clothing, coffee, and on and on.

      This country has operated on a failed energy policy for many decades, and that trend is continuing.

      If we replace Congress with the RIGHT people, we can replace the policy – without the President.

  4. RB says:

    The President IS the most powerful person in the WORLD. HE, should be doing much more about this situation instead of taking EXTREME High-Priced vacations every month with his family and entourage. This is the HEIGHT of HYPOCRISY. If HE can’t do something about this, being the World’s Most Powerful Man, than why do we need him at all, and if he can’t make THIS right, what can he really do about the REALLY serious issues that face America now and in the Future. My guess is N-O-T-H-I-N-G. He is bought and paid for.

    • TJ Thompson says:

      Show me where the Constitution gives the President – ANY President, not just Obama – the authority to control gas prices… or candy bar prices, or sewing machine prices…. or ANY prices.

      The President ONLY has as much power as The United States Constitution allows under Article 2, which is as follows:
      #1 – Act as Commander in Chief of the military
      #2 – Assemble a Cabinet
      #3 – Grant pardons
      #4 – Make treaties
      #5 – Nominate ambassadors, judges, etc
      #6 – Grant recess appointments
      #7 – Give state of the union
      #8 – Force congress to convene
      #9 – Receive ambassadors
      #10 – See that laws be faithfully executed
      #11 – Commission all officers of the United States

      Please tell me what he can Constitutionally and legally do to “make THIS right”.

      The answer is N-O-T-H-I-N-G.

  5. BackwardsBoy says:

    TJ, just because we’re told by this administration that the oil companies, speculators and Republicans in Congress are to blame for the spike in gas prices doesn’t mean we believe them. Americans know that we need to drill to solve our energy crisis, and that Obama, the EPA, and radical leftist organizations such as the Sierra Club and Greenpeace are to blame for impeding our ability to develop our own natural resources, along with the Federal Reserve’s illogical policy of inflation known euphemistically as Quantitative Easing of the money supply.

    Our outrage isn’t misdirected, not by a long shot. We’re going to continue the task we began in the 2010 midterm elections and cleanse Washington of Obama and Progressivism.

    We’ve had quite enough of an unresponsive and unaccountable government that can’t seem to bother itself to do the things the majority of Americans want done, like reducing spending, securing our southern border and forming a common sense energy policy.

    • TJ Thompson says:

      Cleansing Washington of Obama & Progressivism will not solve this problem.

      This has existed under the “unresponsive and unaccountable” Conservatives, Progressives, Republicans, Democrats, and everyone else who has been in Washington.

      Couple the decades of dereliction with the ‘wonderful’ QE policy, and we see what trends need to be reversed in order to alleviate this problem.

    • Anonymous says:

      Nothin to do with the U. S. Constitution Dope, it’s about drilling our own oil, building our own Refineries, and being able to effectively deal with leaders of other Nations in a businesslike- manner, which Obama is incapable of doing due to his ineptitude, arrogance, and socialist mindset, plus ZERO experience in running even a Kool-Aid Stand, but, like yourself , your Socialist Mindset limits your small brain into thinking everything has to do with what the Government can or cannot do. Government is not the solution to the USA’s problems, it is the cause of the USA’s problems

      • TJ Thompson says:

        “Anonymous”, you obviously have not yet acquired reading comprehension skills…

        I am arguing that government IS the problem…. not Obama, not Bush, not any single administration or President – but the government itself.

        The government only has the power that We The People allow it to have – i.e. The United States Constitution. The same document, mind you, that prescribes exactly what the government can and can not do.

        Thus, this has EVERYTHING to do with the Constitution, because WE have the power to change and solve these issues