Real estate prices are declining as oil prices skyrocket to $130 a barrel, causing pain both in the home and at the gas pump. It may come as a shock to many people, but the two price trends are related.
In fact, thank all those subprime mortgage lenders and unqualified homebuyers for a good bit of the 70% increase in the price of a barrel of oil over the last year.
Okay, some of the recent price increase, especially in the last month, has resulted from hedge funds speculating in oil, and some has been driven by an increase in demand from developing countries like China and India, while production has remained level.
But the price of oil, denominated in dollars, is therefore directly tied to ...