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Gold Versus Gasoline

February 25, 2012

I wondered about gasoline costing more and more while we are driving our smaller cars less and less.  I searched for the price of gas versus gold and found this graph at http://pricedingold.com/us-retail-gasoline/

Gas has become cheaper compared to the price of gold.  This makes sense since we are driving less.  We are also more efficient at extracting oil and gas with techniques like horizontal fracturing.  That is the supply and demand side of gasoline.  There is also the supply/demand pressures on gold.  More of us bought gold as a hedge against inflation and added to the demand for gold.  In short-

Gas isn’t more expensive each week; the dollar is simply worth less.

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