by Karl Denninger, Market Ticker:
It’s pretty basic, as I noted in Leverage about 10 years ago: Behind every unit of GDP is a unit of energy.
Period.
I’ve been doing a fair bit of traveling this summer and fall, and in fact am having some fun right now, as I did last weekend.  There is a constant — the spread between diesel and regular gasoline has held right around $2.
I’ve never seen this before.
It portends very bad things.
TRUTH LIVES on at https://sgtreport.tv/
You see, diesel isn’t just what you think of, although that’s bad enough. That is, big trucks without which you get….. nothing. Basically every item you buy from any place, anywhere, makes at least the last mile of that journey by truck. Most of it makes a very large percentage of its journey by either truck or train — both of which run primarily on diesel fuel.
That includes the gasoline you buy at the corner station.
So who thinks inflation pressure is going to come down? How about the people who still use heating oil this winter? Oh, that’s diesel incidentally. Same fuel. Exactly the same fuel — just no road tax, and dyed red so if you try to cheat and put it in a truck you can be caught.
“Well those fools should have converted by now!” you might say. Really? Have you looked at the price of natural gas lately? Propane?
Well just burn wood! If you live where you can. And then…… wait, isn’t this about “saving the planet”?  I thought wood was…… dirty?
Here’s reality, like it or not.
That huge spread exists because the government — and not just ours — has declared war on the very reason we have had a rational cost of living for the last one hundred years. It has driven basically all of our advancement in that regard. It is responsible for all of the plastic things you have (look around you), all of the synthetic fibers (your couch, your bed, etc.) your shoes, your computer(s), your cellphones, the Internet and even the shingles on your house without which it rains inside as well as out.
Bernie Sanders thinks its “wrong” that this spread in prices exists.
Well, let me tell you a little story.
Back in the late 1990s I engaged Investment Bankers to decide what to do with MCSNet as the firm’s CEO. I had laid before me three basic options:
