Economics,  Oil

Yet more things that annoy me

I was listening the ever earnest radio program Democracy Now on the way from my the guitar lesson and I heard for the third time today the phrase “Oil driven inflation”.

Inflation is a general rise in prices, which is the same thing as a decline in the purchasing power of the dollar (or whatever currency). A rise in the price of oil does not cause this. If it did then wages would be increasing due to the oil price increase as well. It is a transfer of wealth from oil-consumer to oil-producer, which is not inflation.

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