High Gasoline Price Mania

I'm only going to say this once.

Gas prices are high and going lower. YEP.

How do I know?

• Oil Prices are down over 12% and weakening
• The refinery crunch caused by the retrofit to low sulfur diesel that took several refineries off line for a week is over.
• Those refineries are cranking 24/7 and at full capacity to get in on this high gas price bubble.
• That Gasoline production is now coming into the market and will start to affect gasoline retails in 2 weeks.
• Those who are predicting 4 or 5 dollar gas are just wrong. They always are.
• The solution to high prices is high prices.
• We went thru this in 2005. Exactly like this. Prices will head back under $3 to the 2 and a half or so level.
• The value of the dollar measured against stable currencies (which the dollar is not) means crude oil is actually about $50. In real dollars of 2005 Gasoline is $2.80 right now.

I know all this is complicated but as a trader I thought you should know what the truth is before you find yourself cranky about high gas prices. If you want to be cranky think about the plummeting value of the dollar. Yes we sell more on the global market but we are also finding ourselves being equalized in earning with much of the world. We are exporting our buying power.

One other thing to be happy about. Chinese melamine in out grains imported from there. I am hopeful this will refocus our dependence on global grains. When I think about the US importing wheat from China my eyes bug out and blood shoots out of my ears.

So, relax, KINDA. All is well in gas price land but not so good in the rest.

We are trading two $25,000 cats for a $50,000 dog and thinking we made a good deal.

We didn't.