Mover Mike

Another way to look at the price of gasoline is to compare the price to Europe. When Bev and I went to Europe in 2000, gasoline was about $4.00 U.S. there, and the chart shows we were $1.50. Notice the nominal price of gasoline broke out the same time as Gold.

Speaking of Gold, look at this second chart of Gold and Oil in 2004 dollars. Both peaked in about 1981. In todays inflation dollars Oil was about $90 a barrel. This month Oil has traded at $126. The two commodities have tracked each other fairly well over the years, Oil bottomed in the late 1990s, Gold in 2001. Oil went on to better its inflation adjusted high. For Gold to do so, it would have to trade over $1,600 to equal its 1981 high. My guess is that most commodities are trading at inflation adjusted highs and Gold will get back in sync before you know it.