LIVING OFF DIVIDENDS & PASSIVE INCOME

A lot of poeple have been complaining about the price of gas at the pump. In fact, Congress has enacted an anti-gouging law that provides upto 10 years in jail and upto $150 million in penalties.

But my contention is that high gas prices don’t make any difference.

Gas isn’t expensive
People are willing to pay $4 for a cup of $tarbucks coffee. That works out to about $1,250 per barrel. Compared to that, $65 for a barrel of light sweet crude sounds pretty cheap!

Besides this, compared to what 93% of the rest of the world pays at the pump, its still cheaper in the US.

High gas prices do not cause inflation
Some of you might think that since we use oil and gas in almost every aspect of our lives from commuting and transporting products to making plastics and profilatics that an increase in the price of oil would lead to inflation.

Well in theory thats true, but we’re experiencing a much higher rate of inflation through the devaluation of the dollar and mindless government spending (through never-ending government expansion, ill-thought out entitlement programs and a very expensive war). The inflation caused by higher oil prices doesn’t compare to this.

The higher oil prices don’t affect our lifestyle
The only people who really feel the pinch at the pump are the people who drive SUVs and SAVs (Suburban Assalt Vehicles). Of course, if they couldn’t afford the gas they wouldn’t have bought them in the first place.

And if they really couldn’t afford them to begin with, they should sell them and buy a Honda Fit, a Toyota Yaris or a Nissan Versa. They could also cut down on the number of miles they drive and walk a little bit too. (66% of US adults are overweight or obese).

Before you start complaining about poor people having to spend an extra $1,000/year because of higher gas prices, I know a lot of poor people who drive $25,000 cars. If they spent $15,000 on one of the cheaper cars mentioned about, the $10,000 they’d save would pay for nearly 100,000 miles worth of gas. Yet another reason to sell your car if you can’t afford it.

Funny how some of these “poor” people I know can afford a $1,000 Plasma TV and $100/month for every single cable tv.

What about the really poor people?
There are probably a lot of poor people living below the poverty level for whom even a $200/year increase will break their budget. Sadly, these people have bigger problems. I can only suggest two things.
Buy a bicycle and read this article on how to live off $12,000 a year.

Gas prices are going to go even higher. Most of the oil’s producers are at maximum capacity and the demand from India and China is growing exponentially. If you’re feeling the pain now, imagine what it’ll be like in a couple of years when oil is $100/barrel and you’re paying $5.50 at the pump?

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