Tuesday, February 28, 2012
Pain at the pumps
Who is to blame for the suffering everyone is facing at the gas pumps? Some believe that the recovering economy has caused demand to rise faster than supply causing a spike in prices. However, the link imbedded in the title believes that over-speculation is to blame. The over-speculation comes in large part from the threat of Iran going to war. If this were to happen, a major source of the world's oil will be temporarily unavailable which would inevitably cause a drop in supply and a spike in prices. But is it right to charge the public for something that has not yet happened, or is it justifiable in order to prevent serious damage later? And how far can someone speculate? Another issue is the dropping power of our nation's currency. With all the drama about the Euro it is easy to overlook the power of our own currency. Over the past few years the purchasing power of the dollar has declined in comparison to other currencies and could be a major reason for the spike in gas prices. So what do you think has caused the rise in prices, and is there an end in sight?
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2 comments:
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Iran and the rising cost of gas seem to be a bit of a red herring. It’s inevitable that the planet will exhaust its oil, coal and natural gas reserves and in the years leading up to this, prices of oil and gas bills will shoot through the roof. The price of gas hurts the US more than Europe simply because the US automakers don’t understand fuel efficiency. One solution to the rising cost of fuel I read about was to boycott oil. If the people showed that they could live without gas for a day or even longer the oil producers may be inclined to limit their prices. Another benefit of an all out strike would show that the people can have less dependence on oil and shift to energy from Hydrogen or the still unexplored Tidal energy. There are companies around the world exploring alternative energy and there are investors willing to back them the decision then lies with the people who must choose what they think is best.
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