The Ups And Downs of Low Gas Prices?

Today the price of gas is down to $2.00 and diesel is at $3.00 and some say it may go down to $1.00. Obviously all consumers want the price of gas to go down so that we will have more money for other things. And that's good for the economy, right? After all, if people spend more money that's more jobs.

Clearly, we all expect prices to go up to $3 or $4 per gallon. But what happens if they don’t. What if the world depression and lower consumption keeps prices low with diesel high?

What effect will this have on the auto industry? Car manufacturers are promising to spend as much as possible on green cars: hybrids and electric cars. Congress even insists that car makers sell more fuel efficient cars in order to receive bridge loans. However consumers will have less incentive to buy these cars, especially since they are much more expensive.

Ev's such as the Chevy Volt need $10,000 worth of lithium –ion batteries. Add an electric motor and other necessities and the car is goes up from $20,000 to $40,000. Who would want to buy that? It looks like green car progress might be delayed for years.

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