Dread and Awful Czar,

Remember when you talked about Quantitative Easing? Well, the chickens have come home to roost. It appears that our friends in OPEC will not be lowering the price of oil just because we are not happy with $100 oil. Now the reason the rise in the price of oil is simple, as Kevin D. Williamson points out at The Corner. Oil, itself, hasn’t changed much. The demand continues to rise while we have become more obstreperous with regard to having a real world energy policy. Most importantly, however, the value of the dollar dropped. The reason, of course, is that we’re printing money faster than ever because some genius felt that quantitative easing was the way out of our current economic malaise. Now we are seeing the consequences of this with $3/gallon gas at the pumps because our dollar isn’t going as far as it did 2 years ago. It’s a good thing we have that 2% cut in the payroll tax to underwrite some of the sticker shock. Sadly, that 2% cut will now no longer be stimulatory as Vice President Biden suggested in his USA today editorial. It will now be damage control.

Best,
Dr. J