Foreign demand for oil can account for its high price.
Food is high because of the ethanol subsidies, foreign demand, and weather setbacks.
What’s wrong with those explanations?
Maybe some increased foreign demand but more-so we are destroying the dollar with QE2 which is nothing more than monetizing the national debt.
Back under Bush when gas and food prices skyrocketed we heard the same arguments, that they had nothing to do with the devaluation of the dollar until the 2008 market crash and the rush to the dollar and food and oil prices went down, Yes Virginia, the value of the dollar does affect prices after all.
And Bernke’s response to rising prices? QE2!
This tutorial might help you:Quantitative Easing Explained