If you are wondering why the price for a gallon of gas keeps going up, keep reading. It is no mystery, no short supply, no pipeline disruption, no civil unrest in Northern Africa or the middle east. It is none of those things. Simply put, the value of the dollar is going down, fast. Globally, oil is traded in dollars. Say it with me. “That same gallon of gas now takes more of these dollars as these dollars have less value than they once did.” One of the reasons is the lack of interest in US savings bonds.
Same with food costs. Notice at the grocery store lately? The only thing going down is your home’s value compared to what you owe the bank for it, if you still got your house. Nice bailout, folks.
With the Japan crisis and the big dip in available parts from there halted, the supply that was in the system is depleted and that is going to impact jobs here and our ability to build things. JOBS, people, JOBS. Globalization and its inherent interdependence does have it’s drawbacks. Some of what won’t be coming for a while from Japan are little things, really, but necessary things. Semiconductors, circuit boards, RAM chips, hybrid car parts. Small in the scheme of things, but it is always the little things. Like the price of a loaf of bread. Small if you have plenty, huge if you are hungry. Japanese markets haven’t been buying US Bonds as they now need the money for the clean up and rebuilding process. It is just out that the nuclear crisis is no smaller than Chernobyl and will take months to years to encapsulate it as best they can. Basically, Japan needs the money. Sorry for the bond market.
And the world is watching the US House of Representatives threatening to not increase the debt limit, is screaming about debt that was solely incurred in two separate cost-plus-no-bid-sweet-ass-deal-never-gonna-let-this-end-cause-we’re-getting-rich wars, both based on lies, not declared officially as war, and paid for with supplemental monies not included in the budget until President Obama. It doesn’t seem to actually matter who is spending what. It will take more of it sooner than later. The rest of the world knows this, and they are pulling their investments out, or at least not making new ones. Even the news that we finally got our main guy Usama bin Laden hasn’t helped much.