Re: Oil is cheap

<joe_avery_2005@xxxxxxxxx> wrote in message
news:1151855120.725404.261270@xxxxxxxxxxxxxxxxxxxxxxxxxxxxxxx
Oil is priced is USD. I suppose the US can print large amounts of USD
and purchase as much oil the economy needs.Then, lower taxes to
reimbursement its consumers for the high prices while the rest of the
world, like the EU, keep on raising taxes on income and gas.

Oil is cheap at $75 or even $275 unless it is prices in gold.


The "value" of a fiat currency depends upon its scarcity. To just print
money and spend that money into the world economy and not provide
a way to collect it after the fact is insanity. No country has ever been
able to create money and not tax this money back out of the economy.
In every case the money becomes worthless. That is what has happened
to the American dollar and all the other fiat currencies that try to
maintain the value of the dollar for their trade advantage. The other fiat
currencies, while not actually tied to the dollar, must follow the dollar
in its downward spiral in order to maintain their trade imbalance with
the USA and thus, their robust employment.

The Fed is doing the right thing in not raising interest rates in any
hurry. The fault does not lie with the central bank. The problem lies
with the tax cutting Bush regime. I think it ironic or guite telling
that the Republicans would rather pay the chieftains in the middle
east (and thus support terrorism) than to collect taxes here in
the USA. For that is the reality. The lack of taxation while
spending great gouts of money on war and shock and awe is
destroying the value of the dollar and thus increasing the
APPARENT price of oil.

--
"I know no safe depository of the ultimate powers
of society but the people themselves; and
if we think them not enlightened enough to
exercise their control with a wholesome
discretion, the remedy is not to take it from
them, but to inform their discretion by
education." - Thomas Jefferson
http://GreaterVoice.org


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