Thursday, June 14, 2012

Gasoline prices spiking again?

Click here for previous analysis of how inflation may affect the housing market.

Click here for an explanation of how one can monitor fuel (and other commodity) prices to get an indication of the direction of inflation and the health of the economy.

On May 7th, 2012, I wrote (quoting CNBC) that fuel prices were in "free fall." Since that post, gasoline prices have fallen roughly 75 cents a gallon in Central Pennsylvania. But today gasoline prices appear to be spiking again, with a 12 or 13 cent a gallon jump appearing at certain stations overnight.  If the "free fall" has stopped, and if prices return to $4.00 (or more) per gallon, the effect on the economy and the real estate market will be even more devastating than the impact we have seen thus far.

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