A few little tidbits on gas prices for you guys

[IamElectro]

Originally posted by: SampSon
Adjusting prices for inflation really does not give an accurate figure.

Sure it does. Those prices given are based on an average hourly wage of woker in 2004.

I can remember in 1980 when gas was actually 1.10 - 1.25 a gallon and minimum wage was 3.10 an hour.

Look at minimum wages per hour over the years.

October 1938 $0.25
October 1939 $0.30
October 1945 $0.40
January 1950 $0.75
March 1956 $1.00
September 1961 $1.15
September 1963 $1.25
February 1967 $1.40
February 1968 $1.60
May 1974 $2.00
January 1975 $2.10
January 1976 $2.30
January 1978 $2.65
January 1979 $2.90
January 1980 $3.10
January 1981 $3.35
April 1990 $3.80
April 1991 $4.25
October 1996 $4.75
September 1997 $5.15

 

[ElFenix]

Originally posted by: SampSon
Adjusting prices for inflation really does not give an accurate figure.

you're using those words like you think you know what they mean

 

[Hector13]

Originally posted by: ElFenix

Originally posted by: SampSon
Adjusting prices for inflation really does not give an accurate figure.

you're using those words like you think you know what they mean

Sampson is right ("technically", at least). It doesn't really make sense to inflation adjust gas prices using the CPI (which I assume is what they use) since the CPI includes gas itself! In the extreme, it would be like adjusting rising gas prices by discounting the amount that gas prices have gone up! In other words, you would see no inflation. I don't think gas is a huge part of the CPI (probably 6-8% for energy), so it probably isn't a big deal here, but it is definitely does present a bias in the numbers (again, assuming the CPI was used).

Using minimum wage numbers like IamElectro listed, or some other non-gas related measure would be more robust.

 

[Apex]

Originally posted by: Hector13

Originally posted by: ElFenix

Originally posted by: SampSon
Adjusting prices for inflation really does not give an accurate figure.

you're using those words like you think you know what they mean

Sampson is right ("technically", at least). It doesn't really make sense to inflation adjust gas prices using the CPI (which I assume is what they use) since the CPI includes gas itself! In the extreme, it would be like adjusting rising gas prices by discounting the amount that gas prices have gone up! In other words, you would see no inflation. I don't think gas is a huge part of the CPI (probably 6-8% for energy), so it probably isn't a big deal here, but it is definitely does present a bias in the numbers (again, assuming the CPI was used).

Using minimum wage numbers like IamElectro listed, or some other non-gas related measure would be more robust.

To make minimum wage numbers a more relevant lens than inflation to look at gas prices, you'd have to look at total compensation numbers, not just monetary compensation.

 

[Qacer]

Tsk.. tsk.. Gas, huh?
People complain about gas.. but they never complain about buying 1 liter of bottled water. What is it about $1 for 1 bottle?
A gallon of gas is about $2.00, which translates to about 3.8 liters. That is about $0.50 per liter.

Ain't it funny? We should complain for getting charged $1 for a liter of water, too. hehe


Go Bolts!

 

[TwiceOver]

Originally posted by: Qacer
Tsk.. tsk.. Gas, huh?
People complain about gas.. but they never complain about buying 1 liter of bottled water. What is it about $1 for 1 bottle?
A gallon of gas is about $2.00, which translates to about 3.8 liters. That is about $0.50 per liter.

Ain't it funny? We should complain for getting charged $1 for a liter of water, too. hehe


Go Bolts!

I don't buy bottled water so I don't complain about it. I don't really complain about gas prices either. 12gal tank 30mpg. Until recently it has never cost me more than $20 to fill my tank from empty, $24.10 recently. A $5 increase in total gas price for me is really nithing. I don't think I'll really complain till we hit ~$3.50.

 

[sharkeeper]

SPR STATS

remember, MB = million barrels!

Cheers!

 

Originally posted by: Hector13

Originally posted by: ElFenix

Originally posted by: SampSon
Adjusting prices for inflation really does not give an accurate figure.

you're using those words like you think you know what they mean

Sampson is right ("technically", at least). It doesn't really make sense to inflation adjust gas prices using the CPI (which I assume is what they use) since the CPI includes gas itself! In the extreme, it would be like adjusting rising gas prices by discounting the amount that gas prices have gone up! In other words, you would see no inflation. I don't think gas is a huge part of the CPI (probably 6-8% for energy), so it probably isn't a big deal here, but it is definitely does present a bias in the numbers (again, assuming the CPI was used).

Using minimum wage numbers like IamElectro listed, or some other non-gas related measure would be more robust.

Yes. Since the system is designed to even itself out, these adjusted numbers would always read in the same ballpark depending on which year you take the data set from. You can make the same adjustments for just about every product.
Milk would be the first thing that comes to mind. If you made the same "adjusted for inflation" chart for milk, it would show very similar results.

About 6 years ago gas was under $1 a gallon. Wages were not much different 6 years ago than they are today. Minimum wage really has no relevance

Iamelectro: The average wage worker does not make minimum wage. Why adjust for the lowest common denominator?

 

[nageov3t]

Originally posted by: Qacer
Tsk.. tsk.. Gas, huh?
People complain about gas.. but they never complain about buying 1 liter of bottled water. What is it about $1 for 1 bottle?
A gallon of gas is about $2.00, which translates to about 3.8 liters. That is about $0.50 per liter.

the problem is that I don't have to buy bottled water to get from my home to my office

 

[BeauJangles]

Originally posted by: richardycc
wow, we only have enough reserve for ~33days? I think we are f<uked!

Strategic Oil Reserve is mostly for conducting military operations, not driving you around.

 

[jagec]

Originally posted by: Qacer
Tsk.. tsk.. Gas, huh?
People complain about gas.. but they never complain about buying 1 liter of bottled water. What is it about $1 for 1 bottle?
A gallon of gas is about $2.00, which translates to about 3.8 liters. That is about $0.50 per liter.

Ain't it funny? We should complain for getting charged $1 for a liter of water, too. hehe


Go Bolts!

Who buys bottled water, anyway? Big waste of money. Just get a filter if your tap water doesn't taste good...

I remember about 3 years ago when the price of gas dropped to $.89 briefly where I was...good times...now I'm paying $2.40

 

[Chu]

Originally posted by: richardycc
wow, we only have enough reserve for ~33days? I think we are f<uked!

Something I've always wondered, that works out to ~700M barrels. Where do they store this much oil?

 

[Cashmoney995]

We have only to blame but ourselves for not taking over Saudi Arabia.

If there is one country we should own, its Saudi Arabia.

 

[ElFenix]

Originally posted by: SampSon
Yes. Since the system is designed to even itself out, these adjusted numbers would always read in the same ballpark depending on which year you take the data set from. You can make the same adjustments for just about every product.
Milk would be the first thing that comes to mind. If you made the same "adjusted for inflation" chart for milk, it would show very similar results.

About 6 years ago gas was under $1 a gallon. Wages were not much different 6 years ago than they are today. Minimum wage really has no relevance

Iamelectro: The average wage worker does not make minimum wage. Why adjust for the lowest common denominator?

that might work if the system only took into account the price of gasoline, but since it doesn't you're not really getting quite that effect. i do think the CPI is a rather sh!tty measure, though. minimum wage is worse since only high school students make it and increases don't have anything to do wtih cost of living. price of a gallon of gas as a percentage of nominal income might be a decent way to normalize it. the numbers read in the same ballpark due to the fact that the real cost of oil doesn't change all that much. OPEC doesn't want the price to go up too high because then other suppliers can come online, conversely they don't want the price too low because then they're not making enough money.

 

[sharkeeper]

Something I've always wondered, that works out to ~700M barrels. Where do they store this much oil?

Underground salt caverns along the Gulf Coast

Cheers!