Oil wager

Posted on December 01, 2007 by Steve

Two years ago Dave took on my wager that Big Macs would rise in price faster than oil. One fifth of the way into the ten-year term, things are going in his favor:
OilBig MacRatio
1 Dec 2005$58.75$3.0619.2
27 Jan 2006$67.35$3.1521.4
6 Apr 2007$64.28$3.1020.7
1 Dec 2007$89.00$3.4126.1


The current Big Mac price comes from the Economist's Big Mac Index of July 2007. The price of light sweet crude is from 321energy.com.

Here's a chart showing the petroleum surge.
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Comments

Posted by David Hamm | December 01, 2007 | 17:51:41

I think the increase in the price of oil is largely due to the decrease in the U.S. dollar. It's surprising that this decline hasn't effected Big Mac prices that much.

See how oil price moves in other currencies:

http://paul.kedrosky.com/archives/2007/11/27/oil_comparing_c.html

It'd be introducing to see how the big mac/oil ratio has moved in other currencies/countries too.
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