INFLATION

With gas prices at the pump nearing $4 a gallon in So Cal (Some in LA are paying $5 a gallon.), drivers are getting fewer miles per tankful.

Bill Gross, the Pimco bond guru in his latest newsletter discussing monetary policy and the economic recovery, wrote:

Each additional dollar of credit seems to create less and less heat. In the 1980s, it took four new dollars of new credit to generate $1 of real GDP. Over the last decade, it's taken $10, and since 2006, $20 to produce the same result.

Gasoline and GDP both start with the same letter in the alphabet, inflation.