It’s June, which means vacation for many of you readers. Though the following will be relevant even for those of you who will be working the whole 30 days long…

These last few months have been especially infuriating for those on the road. With gas prices surging over these first two quarters, the frustrations associated with filling a tank of gas are enough to drive even the most meek mild-mannered motorists into madness.

Currently, the U.S. is averaging nearly $5 per gallon of regular unleaded – and $5.75 for a gallon of diesel. These prices represent a nearly 50% increase from March of last year.

They’re also the highest our country has ever seen.

Aside from the personal pain of pumping the better part of a $100 bill into our tanks, increased gas prices have affected the entire economy since everything touches a truck at some point. And as shipping costs increase, corporations are passing those expenses to the consumer.

This not only drives up the price of living but ultimately weakens the dollar.

I know that. You know that.  And the government is beginning to fully acknowledge that as well now. The Wall Street Journal reports:

“Treasury Secretary Janet Yellen said this week that the U.S. was involved in ‘extremely active’ talks with European allies about efforts to form a buyers’ cartel and set a cap on the price of Russian oil.

“‘I think what we want to do is keep Russian oil flowing into the market to hold down global prices and try to avoid a spike that causes a worldwide recession and drives up oil prices,’ Ms. Yellen said. ‘But absolutely the objective is to limit the revenue going to Russia.‘”

So what is a buyers’ cartel exactly? Is the U.S. about to cut a deal with South American drug runners and start controlling the prices of limes and avocados?

Fortunately, it’s not that kind of cartel. What she’s referring to is essentially an alliance of competing buyers who unanimously refusing to buy until certain terms are met.

The intention is to force Russia to sell its oil at a fixed price. Though China and India are unlikely to comply in this deal, significantly lessening the intended affect.

Knowing that, another idea is to leverage insurers from European countries to levy sanctions on all oil leaving Russia. This could effectively bring down the price of oil not only in Russia but also its allied countries such as the two previously mentioned trading partners.

Keep in mind that “could” is the key word though. I don’t want to give any false hopes here.

And regardless, with so many moving pieces, I wouldn’t expect a final resolution anytime soon. Until then, just close your eyes at the pump.

More Non-REIT News to Know About 

Surprise. Surprise. The stock market fell yesterday ahead of today’s inflation report.

That information is out today now – and worse than expected. Quoting Yahoo Finance this time:

“For market participants, the Bureau of Labor Statistics’ release of the Consumer Price Index (CPI) was a key print, offering a fresh look at the extent to which price increases have persisted across the U.S. economy. The index unexpectedly accelerated to post an 8.6% annual increase in May, following April’s 8.3% rise. That marked the biggest jump since late 1981, and took out the prior 41-year high set in the March CPI, which rose 8.5%.

“On a month-over-month basis, CPI also jumped by 1.0%, or more than the 0.7% rise expected and April’s 0.3% increase. Core inflation, which excludes volatile food and energy prices, increased 6.0% on an annual basis after April 6.2% increase.”

Perhaps expecting that – and the Fed’s upcoming reaction to it –  the S&P slipped 0.7%, the Dow dipped 0.4%, and the Nasdaq fell 0.9% yesterday. And they’re looking to extend those losses today.

European markets weren’t too keen on the possibilities either. The pan-continental Stoxx Europe 600 closed down nearly a point and a half as the euro fell 0.7% against the dollar yesterday.

Speaking of that area of the world, the European Central Bank announced it would increase its key interest rate from -0.5% to zero or higher. This will begin as quarter-percentage increases starting July 1.

It’s looking to be quite the summer this year… before the summer even officially begins.

The World According to REITs

For nearly a month, Prologis’(PLD) hostile acquisition of Duke Realty (DRE) has been the talk of the REIT world. That’s why many investors showed up to a Wednesday session at REITweek: to see if some tea would be spilled.

Instead, they got dead silence on the subject.

 Duke CEO Jim Conor deflected inquiries about the prospective acquisition, saying, “We’ve said all that we have to say on that, and we firmly believe that the ball is Prologis’ court.”

 Prologis, for its part, didn’t provide investors with so much as a whisper of a discussion, dismissing any inquiries before its presentation. It even began by declaring talk of the merger as “no-man’s land.”

 Okay then.

This is certainly one of the more hostile bids we’ve seen in the REIT sector so far – and one that must be carefully considered as our economic climate grows ever more uncertain. I have to say it was really responsible of both parties involved to keep a lid on it, especially during such a raucous event like REITweek.

 But when the news does finally break? I know I for one will be excited to report on the terms.