If you need help picking out a bike, lemme know :) I drive a car, but work in the bike industry and am overjoyed at the number of people in the US looking to bikes as an alternative form of transportation.

From what I’ve read and seen, we pay way less for gas than anywhere else in the world. This change is gonna hurt – and it will hurt tons of working class people (truck drivers, anyone?) – but in the end, I think our country will ultimately be will be better off thinking and doing more about conservation and seeking out car-alternatives.

I won’t dismiss all of the concerns about the weak dollar (and I don’t think you do either), but mostly I agree with you–we have too much money chasing the only investment that is paying off right now.

There are a couple additional causes making that investment look good right now.

Instability in Nigeria (government is threatening greater regulation of oil industry) and Israel sending signals that an attack on Iran is inevitable, and Morgan Stanley suggesting oil will reach $150 per barrel by July 4 also sent giddy investors thinking that an oil squeeze is imminent.

Stuff that normally would take days to filter into the market’s calculations moves through it quickly now creating chaos like this–unfortunately, a quiet OPEC message (via Nigeria’s oil ministry) that it may pump some more oil to calm the market didn’t make it to Wall Street in time to cool the panic….maybe Monday.

Of course that could be one man’s opinion, too, but really, one man’s opinion can make a difference in our information rich world

what’s one big reason why the dollar is in it’s current state? Could it have anything to do with the fact that we’ve spent $600 billion dollars in Iraq that we had to borrow and are planning to spend another $200 billion this year alone?

Nope. Thats not how currency markets work. The ratio of federal expenditure to GDP or total tax revenue is not altogether different than it was in 2003 or during other periods of the Clinton administration when the dollar was in a much stronger position.

Oil prices didn’t go up 11$ in a single day because all of a sudden today the world demanded 8.6% more oil than yesterday, or the federal government spent 8.6% more money in Iraq today than yesterday. The dollar actually went up over the past few days against many currencies.

Oil right now is hyperinflated. Today’s remarkable jump proves that. The economy is slow, real estate is a bad investment, unemployment is up and the DOW dropped. Investors want to make money, and right now their best bet is to invest in oil, because demand is still strong and therefore the prices keep going up.

As soon as there are inklings of an upturn in the stock market, or a bottoming out of housing prices (probably both congruently), investors are going to dump out of oil as fast as they put in, because they know better than anyone that oil is inflated due to speculation. There will be a huge crash in gas prices, back to under $100/barrel or $3.00/gallon – but this will take many months or perhaps years. It depends how fast we get out of this real estate mess and people start buying homes again.