I'm not about to step into the emotional electricity / fossil fuels debate but perhaps I can help with a couple of misconceptions about the current price of fuel. If you correct for taxes and other government fees, gasoline sells for about the same price world wide. It comes as a surprise to many when I tell them that the price of gasoline is not actually rising in real terms by very much. Some of you may be old enough to remember the inflation of the mid seventies to the early eighties when the same phenomenon was evident. What you are seeing is a reflection of the falling value of the dollar. It is caused by inflation. Inflation is an expansion of the money supply through debt by governments in partnership with central banks - not, as popularly believed, an increase in consumer prices per se. Increased consumer prices are an effect of inflation. You have seen this liquidity increase roll through a series of bubbles. First it boomed the stock market, then the housing market and now commodities. Energy is booming and food is next. Tip: if you are carnivorous, I would stock up on meat now. The real increase in the price of fossil fuels is in the cost of extraction which is increasing (but gradually) and increased demand in developing nations. But these components pale compared to the effects of monetary inflation. If you take the price of a barrel of oil and divide it by the price of gold you will see that oil prices have remained nearly constant since 1945. Gold is the closest thing we have to a constant through history. We can use it to correct for monetary effects and doing so illustrates where the problem really lies. If the price of gas, housing, food and such is important to you please point the finger of blame accurately - at the deliberate policies of the Federal Government and Federal Reserve Bank. The dollar has decreased 95% in spurts since 1913 when the FED was created. This is just the latest wave. It is not the fault of greedy oil companies, middle Eastern cartels nor speculators; all of which will be blamed before the real culprit. It doesn't have to be this way. The Byzantine Empire managed to keep prices constant for nearly 800 years. This is a vast simplification, though relatively simple to prove given enough time, and this is the wrong forum for detail. Still, I point it out as a public service wherever I encounter such discussion. You may be as confused by monetary policy as I am by some of the technical discussion on this forum. I am mostly an observer now, but spent nearly forty years as an economist - a fact I rarely mention at social gatherings. Steve Brooks -- "There is no subtler, no surer means of overturning the existing basis of society than to debauch the currency. The process engages all the hidden forces of economic law on the side of destruction, and does it in a manner which not one man in a million can diagnose." - John Maynard Keynes
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