Re: Can you buy a gallon of gasoline for a bit more than a QUARTER? (read for the 'catch')
- From: "americancoppercoins" <americancoppercoins@xxxxxxxxxxxxx>
- Date: Sun, 14 May 2006 09:08:48 -0400
"Bruce Remick" <remick@xxxxxxx> wrote in message
I think his desired intent is for you (us) to buy George's book so he may
"TJ-BF" <r2@xxxxxxx> wrote in message
"Gasoline at 10 Cents a Gallon and Falling"
by George Reisman
May 12, 2006
Does gasoline at 10 cents a gallon and falling sound impossible in
Well, if you think it's impossible, you're wrong. Because that's where
gasoline actually is, and it looks like it's going even lower.
Of course, it's not 10 cents a gallon in today's paper money. But it is
10 cents a gallon in the Constitutional money of the United States, which
is gold coin and bullion.
Gold is now at $700 per ounce, and rising. To the right is a picture of a
$20 United States gold coin known as a Double Eagle. If you look
carefully, at the bottom of the coin, you can actually see where it says
This coin contains approximately one ounce of actual gold, which means
that at today's market price of gold, it's worth $700. And this means
that one gold dollar is worth $35 of today's paper dollars. And that
means that one gold dime is worth $3.50 in today's paper money. This
last, of course, is roughly what a gallon of gasoline costs in today's
paper money. Which means that a gallon of gasoline costs just 10 gold
So why does a gallon of gasoline cost $3.50 in the paper money? Well, one
explanation is that we're expressing the price of gasoline in terms of a
money that is itself very cheap and getting cheaper. Just think: if $20
gold dollars are worth $700 paper dollars, one paper dollar is worth only
one thirty-fifth of a gold dollar. That's less than three cents. It
shouldn't be surprising that buying things with three-cent dollars is
going to require a lot of such dollars.
The key point here is that our money is getting cheaper and that's why
prices are rising. Don't be surprised if in the future, gasoline is a lot
more expensive in paper money than it is today and, at the same time,
cheaper than it is today in our Constitutional gold money. Look for $5
per gallon gasoline in paper and seven cents per gallon gasoline in gold.
That's a real possibility.
So what would you (or he) suggest we do about it? Wring our hands raw?
Start paying for gas with our gold holdings? Move our families to Yap?
get a cut of the devalued dollar.
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