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lil_Blue_Ford
Cut & Weld
TRS Forum Moderator
TRS 20th Anniversary
TRS Event Participant
TRS 25th Anniversary
- Joined
- Aug 6, 2007
- Messages
- 10,889
- City
- Butler
- State - Country
- PA - USA
- Vehicle Year
- 2000
- Vehicle
- Ford Ranger
- Engine
- 5.0
- Transmission
- Automatic
- Total Drop
- 4”
Wow...
Lets clear a few things up, shall we?
Yes, the dollar is weak right now. No, it is not the sole reason for the increased prices. At some point the dollar will come back in strength, it always has in the past. The real problem for the current situation of the dollar and the economy is due to banks and other lending institutions making loans to people that never really should have had them to begin with. When those people started to get to a point where they couldn't pay their bills and reposessions started, the market became flooded with houses and other goods... and a ton of people looking to replace what got taken from them. I could go on, but I"ll save that for later.
Gas has gone up in price partly because the Arabs are charging us more for a barrel of oil than before, they have increased production but not enough to cover what they are now selling other countries like China, and because of our refinery situation. Recent reports I've heard are saying that China's government is subsidizing the cost of gas... their citizens are buying gas for around $0.10 a gallon! Of course, that price can't last forever, but it's encouraging to their population to be wasteful with it, which causes a demand that the Arabs are eager to fill, which means less fuel for us.
Our refinery situation is a real mess. Different "blends" for different areas of the country cause an increased cost in refining gasolines because if the plant that produces for one area has a surplus and that in another area is short, the wonderful EPA says that you can't ship the surplus to the other area of the country. Not to mention most of our refineries are quite outdated and wasteful because of old worn out technology being used, but you guessed it, the EPA and a few enviromentalist nuts are preventing new refineries here, lets just have the Arabs refine it for us...brilliant.
And before anyone points to big oil and their profits... have you actually looked to see what the oil companies make per gallon in profit? Have you looked to see what the government makes per gallon via taxes? It varies by location but I heard one local report give that oil companies make around 12% in profit... government (local/state/fed) gets more like double that... so who is really making off with our money?
Rising fuel costs are affecting a lot of things, but like has been stated, it has not fully filtered down yet. People are reluctant to raise prices because they are partly afraid that a rise in the price will cause people to stop buying in large enough numbers to cause a company serious problems. It is also partly because people are hoping that this will be a short-term problem and the price of fuel will drop back down soon. (it costs a company money to re-price things, thus they don't really want to raise it a big jump now and then have to take it back down in 6 months or a year). Plus there is the problem that while prices are starting to creep up like a bad set of underwear, wages are staying the same. Until wages go up (and thus the total cost of doing business), many people simply cannot afford to pay prices that increase much more.
Lets clear a few things up, shall we?
Yes, the dollar is weak right now. No, it is not the sole reason for the increased prices. At some point the dollar will come back in strength, it always has in the past. The real problem for the current situation of the dollar and the economy is due to banks and other lending institutions making loans to people that never really should have had them to begin with. When those people started to get to a point where they couldn't pay their bills and reposessions started, the market became flooded with houses and other goods... and a ton of people looking to replace what got taken from them. I could go on, but I"ll save that for later.
Gas has gone up in price partly because the Arabs are charging us more for a barrel of oil than before, they have increased production but not enough to cover what they are now selling other countries like China, and because of our refinery situation. Recent reports I've heard are saying that China's government is subsidizing the cost of gas... their citizens are buying gas for around $0.10 a gallon! Of course, that price can't last forever, but it's encouraging to their population to be wasteful with it, which causes a demand that the Arabs are eager to fill, which means less fuel for us.
Our refinery situation is a real mess. Different "blends" for different areas of the country cause an increased cost in refining gasolines because if the plant that produces for one area has a surplus and that in another area is short, the wonderful EPA says that you can't ship the surplus to the other area of the country. Not to mention most of our refineries are quite outdated and wasteful because of old worn out technology being used, but you guessed it, the EPA and a few enviromentalist nuts are preventing new refineries here, lets just have the Arabs refine it for us...brilliant.
And before anyone points to big oil and their profits... have you actually looked to see what the oil companies make per gallon in profit? Have you looked to see what the government makes per gallon via taxes? It varies by location but I heard one local report give that oil companies make around 12% in profit... government (local/state/fed) gets more like double that... so who is really making off with our money?
Rising fuel costs are affecting a lot of things, but like has been stated, it has not fully filtered down yet. People are reluctant to raise prices because they are partly afraid that a rise in the price will cause people to stop buying in large enough numbers to cause a company serious problems. It is also partly because people are hoping that this will be a short-term problem and the price of fuel will drop back down soon. (it costs a company money to re-price things, thus they don't really want to raise it a big jump now and then have to take it back down in 6 months or a year). Plus there is the problem that while prices are starting to creep up like a bad set of underwear, wages are staying the same. Until wages go up (and thus the total cost of doing business), many people simply cannot afford to pay prices that increase much more.
