Thursday, November 11, 2010

LTE of the NewsVirginian... Dollar Down, Prices Up

The NewsVirginian is a very fair paper. It has an editorial board that  seems to present a balanced view of the world, with a lean to the conservative side. To counter this lean, they have some Op-Ed writers that lean left. Leaning left is fine, but their opinion should be based on fact, not Democrat Talking points.
The News-Virginian had a piece today from Nelson Graves, a government employee, that was a repeat of semi-annual Democrat talking points. "Gas Prices are up because of Republicans".

I responded. Short and to the point.I don't know if it will be printed....

The article by Mr. Graves is typical of the liberal talking points that he usually presents. I wonder if Mr.Graves has looked at the commodity market recently? Has he noticed the commodity prices from around the world? World oil prices neared 90 dollars for the first time in more than two years on Thursday, stoked by expectations of increased demand amid tight supplies, traders said.
Mr. Graves is baffled by this.
Brent crude reached 89.70 dollars a barrel in London trade -- its highest level in two years and close to reaching the 90-dollar mark for the first time since October 2008.
Light sweet crude was up 68 cents to 88.49 dollars a barrel.
The worldwide prices of staples has increased. The NewsVirginia even noted that even here in Virginia, 60 localities were declared disaster areas due to drought.
The value of the US dollar has decreased., thus causing the price of commodities to rise in relationship to the dollar. Maybe Mr. Graves missed the news on Quantitative Easing enacted by the Federal Reserve. That is the flooding of the market with cheap dollars. China said on Thursday that the U.S. Federal Reserve's move to ease monetary policy risked undermining the global economic recovery, adding that Washington "should not force others to take medicine for its own disease".
No,Mr. Graves, it is not the Republican resurgence that is causing your trip to the pump to be more expensive. It is Worldwide price increases in relation to the shrinking dollar.