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Good news

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Got hold of a newspaper to try to figure out what's happening with these gasoline prices.

"Merrill-Lynch economists estimate that every penny-per-gallon increase at the pump dranins about $1.5 billion out of the consumers' pockets.  That means the increase in gasoline costs this year has reduced the amout consumers have to spend on other items by about $90 billion.

However, that drag on consumer spending has been offset by low long-term interest rates, which have spurred homeowners to refinance their mortages and spend the savings.

So far, analysts note little indication has suffered and say inflation expectations are different.

Oil shocks in the 1970s and 1980s occured at a time of sharply rising inflationary pressures, prompting aggressive interest rate increases."

Naturally, I find that pretty comforting.  We don't have to anticipate a lot of inflation, so there'll be roughly the same amount of money circulating.  Likely as not the price of coffee, which I noticed had gone up almost double, will drop again because nobody's going to have any money to buy any of it.  Same with everything else that involves transport (fuel costs).

But it's been a hot summer.  We'll all welcome this cold winter we'll be able to enjoy better because the summer was so hot.

I'm glad I don't understand economics.

Jack 

Entry #197

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