Tuesday, April 22, 2008
The price of gasoline is consistent with current inflation
Adjusted for inflation and tax, gasoline prices should actually be higher than they are today. "First, we need to take into account inflation. The result of the Federal Reserve printing too much money is a loss of purchasing power of the dollar: something that cost $1.00 in 1950 would cost about $8.78 today. As for gas prices, in 1950 the price of gas was approximately 30 cents per gallon. Adjusted for inflation, a gallon of gas today should cost right at $2.64, assuming taxes are the same." But taxes have risen considerably, meaning that, adjusted for inflation (inflated money supply) gas is cheaper now than it was in the 1950's.