Oil down $30 in a month.

[dmcowen674]

Originally posted by: 3chordcharlie

Originally posted by: CycloWizard

Originally posted by: 3chordcharlie
You are (both of you) applying a very juvenile definiton of 'inelastic'. You're also freely switching between 'short-run' and 'long-run' effects of price changes.

Please educate us rather than just name-calling. I know a good deal about the theory of elasticity. That economics has borrowed it to describe financial systems makes me think they are connected. The idea that something is "inelastic" is analagous to the idea of a rigid body - it's an approximation that holds in some limiting cases. However, it's obvious that it does not hold in this case because the price and demand have followed each other in some fashion.

There is really no such thing as perfectly inelastic demand. In economics, elastic and inelastic are used to describe the degree to which one quantitative measure responds to changes in another. Gas would be considered quite inelastic in the short-run, because when the price changes today, you still have to go through with your plans for tomorrow (like going to work). People can't make drastic changes immediately, so demand for commodities tends to be inelastic in the short term. If the price of gas fell to $1/gallon tomorrow, thousands of people would still drive their Prius to work, because they hadn't had time to trade it in on the Ford Explorer they could now comfortably afford to drive.

Cyclo, if you think people always and only pay 'what something is worth', then why, when oil was $9 a barrel, was nobody voluntarily throwing in an extra $20/fillup at the gas station, if the oil was 'worth' so much more to them than the posted price?

We can spend all day making graphs of 'marginal' and 'average' demand, and use new and used car sales/prices to try to map out what people really think oil is 'worth', or you can actually stop being obtuse instead of only saying you don't want to be.

And you can tell me why I'm wrong, or you can just call me names and try to denigrate me. The bottom line is that people will pay what they feel something is worth at that time, short of someone holding a gun to their head and making them do it. Since I have yet to observe this, I can only assume that people think that the gas they are buying is worth what they are paying for it.

'What something is worth' is a nebulous concept, and many people have guns to their heads all the time, especially in today-tomorrow-next-week time-frame.

Try to think of it this way: No matter the price of gas, you will drive to work tomorrow, in whatever vehicle it is that you drive. You will do this because you need to, and you would do it (for one day) even if the gas cost more than your pay. We can be pretty sure of this, because most of us, for one of our teenage jobs, had circumstances that forced us to spend more than our lousy pay on a cab-ride to make a shift. (Broken car, unreliable ride, missed the bus, slept in, whatever).

Obviously this is an unsustainable situation, so people make changes (Over the last 4 months, North America has stopped buying trucks and SUVs as commuter vehicles). Since what is sold at gas stations isn't really 'gas' but 'mobility', the price is actually different for every single purchaser: While the little 250cc bike at the pump is busy buying 200miles for $8, the contractor is buying 250 miles worth of towing 10,000lbs for $150 in his F350, and the middle-manager is paying $100 for 300 miles in his Sierra (while looking enviously at the bike, and hoping his wife finds a nice Civic for them to buy soon).

At any given time, most people can't just run out and buy a new vehicle today, or move tomorrow, or change jobs by Monday. In the weeks-months-years timeframe, people will respond to sustained high prices, and you will get a good idea of what they actually think gas is 'worth'.[/quote]

That's quite an education you gave there :laugh:

 

[Darwin333]

Originally posted by: dmcowen674


At any given time, most people can't just run out and buy a new vehicle today, or move tomorrow, or change jobs by Monday. In the weeks-months-years timeframe, people will respond to sustained high prices, and you will get a good idea of what they actually think gas is 'worth'.

[/quote]

A perfect argument on why we need to be drilling more of our own oil. At the end of the day we are going to pay for oil in the foreseeable future. Would you rather pay Exxon or Saudi Aramco?

 

[quest55720]

Originally posted by: Darwin333

Originally posted by: dmcowen674


At any given time, most people can't just run out and buy a new vehicle today, or move tomorrow, or change jobs by Monday. In the weeks-months-years timeframe, people will respond to sustained high prices, and you will get a good idea of what they actually think gas is 'worth'.

A perfect argument on why we need to be drilling more of our own oil. At the end of the day we are going to pay for oil in the foreseeable future. Would you rather pay Exxon or Saudi Aramco?

The people hurt most by the high gas prices will be the last to be able to afford to change. People around these parts assume that everyone has a ton of money and can just lay out 20-30k for a hybrid. Or just sell that house that is worth 20% less and move closer to work. Or just up and find a new job that is closer to home. It is going to be a very long time before the working class can afford to make any changes. Every day gas prices suck money away is just a day further away they are from being able to make changes like moving or buying a hybrid.

We need to drill here and drill now to help out those who are hurt most by the high gas prices. I would love to ask Obama a simple question if he really thinks it will be 10 years before any oil flows. Then he should have no problem with charging no taxes or roylaties on new wells off the coasts that go on line with in 8 years. It is not possible according to Obama and his supporters. I would bet my house he would not agree to do it because he knows oil can go online much faster than 10 years. He is just in the pocket of the tree huggers.

People can claim it is a drop in the bucket supply wise. The thing is it would be a safe stable supply that is not affected by polical unrest. That drop in the bucket could be just enough of a buffer to keep prices from going crazy every time a pipe line in a 3rd world country is disrupped. It will also create good paying jobs and keep money in this country. Hell we don't even know how much oil is out there because they have not been able to expore the area. For all we know there could be a huge pocket of oil like the one they found in brazil.

 

[3chordcharlie]

Originally posted by: quest55720

Originally posted by: Darwin333

Originally posted by: dmcowen674


At any given time, most people can't just run out and buy a new vehicle today, or move tomorrow, or change jobs by Monday. In the weeks-months-years timeframe, people will respond to sustained high prices, and you will get a good idea of what they actually think gas is 'worth'.

A perfect argument on why we need to be drilling more of our own oil. At the end of the day we are going to pay for oil in the foreseeable future. Would you rather pay Exxon or Saudi Aramco?

The people hurt most by the high gas prices will be the last to be able to afford to change. People around these parts assume that everyone has a ton of money and can just lay out 20-30k for a hybrid. Or just sell that house that is worth 20% less and move closer to work. Or just up and find a new job that is closer to home. It is going to be a very long time before the working class can afford to make any changes. Every day gas prices suck money away is just a day further away they are from being able to make changes like moving or buying a hybrid.

We need to drill here and drill now to help out those who are hurt most by the high gas prices. I would love to ask Obama a simple question if he really thinks it will be 10 years before any oil flows. Then he should have no problem with charging no taxes or roylaties on new wells off the coasts that go on line with in 8 years. It is not possible according to Obama and his supporters. I would bet my house he would not agree to do it because he knows oil can go online much faster than 10 years. He is just in the pocket of the tree huggers.

People can claim it is a drop in the bucket supply wise. The thing is it would be a safe stable supply that is not affected by polical unrest. That drop in the bucket could be just enough of a buffer to keep prices from going crazy every time a pipe line in a 3rd world country is disrupped. It will also create good paying jobs and keep money in this country. Hell we don't even know how much oil is out there because they have not been able to expore the area. For all we know there could be a huge pocket of oil like the one they found in brazil.

Regardless of how soon this oil could be brought online, and ignoring altogether whether it would have a substantial effect on prices, and paying no attention whatsoever to any lingering environmental questions:

If high oil prices are inevitable and permanent, they might as well happen now, because people will not change their consumption choices without incentive.

For decades people have chosen to buy vehicles that get poor mileage, have rarely asked for better, and have driven everywhere, at all times; when I was growing up, nearly every occasion seemed to call for either two trips, or two vehicles, for no particular reason.

Begging to drill this oil is not about the working class - there are a million better ways to help low and middle income people through this sort of transition more effectively than by dumping a few drops of oil into a massive world market.

 

[JS80]

Originally posted by: dmcowen674
This is how the futures market works:
B = Buyer
SB = Speculative Buyer
S= Seller

S comes in offering Oil at the beginning of the month at $30.
SB comes in quickly and buys at $30.
SB offers for $35.
SB2 buys for $35.
SB2 offers for $40.
SB3 buys for $40.
...
...
...
SB40 offers for $100
B buys for $100.

What would the price have been if there were no speculative buyers? $30.

This isn't exactly how it works in the real world, but it's a VERY SIMPLE illustration to show up speculation does indeed push prices past what it could have been at. Plus "true value" of an inelastic good is very tricky.

So do you agree with me that it is criminals?

It has to be illegal in order for it to be criminal. Is it immoral? Absolutely.

 

[quest55720]

Originally posted by: 3chordcharlie

Originally posted by: quest55720

Originally posted by: Darwin333

Originally posted by: dmcowen674


At any given time, most people can't just run out and buy a new vehicle today, or move tomorrow, or change jobs by Monday. In the weeks-months-years timeframe, people will respond to sustained high prices, and you will get a good idea of what they actually think gas is 'worth'.

A perfect argument on why we need to be drilling more of our own oil. At the end of the day we are going to pay for oil in the foreseeable future. Would you rather pay Exxon or Saudi Aramco?

The people hurt most by the high gas prices will be the last to be able to afford to change. People around these parts assume that everyone has a ton of money and can just lay out 20-30k for a hybrid. Or just sell that house that is worth 20% less and move closer to work. Or just up and find a new job that is closer to home. It is going to be a very long time before the working class can afford to make any changes. Every day gas prices suck money away is just a day further away they are from being able to make changes like moving or buying a hybrid.

We need to drill here and drill now to help out those who are hurt most by the high gas prices. I would love to ask Obama a simple question if he really thinks it will be 10 years before any oil flows. Then he should have no problem with charging no taxes or roylaties on new wells off the coasts that go on line with in 8 years. It is not possible according to Obama and his supporters. I would bet my house he would not agree to do it because he knows oil can go online much faster than 10 years. He is just in the pocket of the tree huggers.

People can claim it is a drop in the bucket supply wise. The thing is it would be a safe stable supply that is not affected by polical unrest. That drop in the bucket could be just enough of a buffer to keep prices from going crazy every time a pipe line in a 3rd world country is disrupped. It will also create good paying jobs and keep money in this country. Hell we don't even know how much oil is out there because they have not been able to expore the area. For all we know there could be a huge pocket of oil like the one they found in brazil.

Regardless of how soon this oil could be brought online, and ignoring altogether whether it would have a substantial effect on prices, and paying no attention whatsoever to any lingering environmental questions:

If high oil prices are inevitable and permanent, they might as well happen now, because people will not change their consumption choices without incentive.

For decades people have chosen to buy vehicles that get poor mileage, have rarely asked for better, and have driven everywhere, at all times; when I was growing up, nearly every occasion seemed to call for either two trips, or two vehicles, for no particular reason.

Begging to drill this oil is not about the working class - there are a million better ways to help low and middle income people through this sort of transition more effectively than by dumping a few drops of oil into a massive world market.

Actually there is no better way to help them with out bankrupting the country with some massive social program. The oil companies would foot the bill to get the wells up and running. The government could use its money to develop and give insentives for alternatives. The drilling would help bridge us till we find a real alternative which could take a long long time.

I love how the obama people say a few drops. Using any excuse to not drill and help the working class. Those few drops would be produced by american workers and the government would get tax and royalties. It is a win win this government gets a new flow of money it can use to help push alternatives or even help pay for the 10 trillion in debt we have.

It will be atleast 5-7 years after a real alternative is found before the working class will be able to get on board. That is when middle class people will start trading in first generation alternative cars and the working class can buy them used.

 

[3chordcharlie]

Originally posted by: quest55720
Actually there is no better way to help them with out bankrupting the country with some massive social program. The oil companies would foot the bill to get the wells up and running. The government could use its money to develop and give insentives for alternatives. The drilling would help bridge us till we find a real alternative which could take a long long time.

I love how the obama people say a few drops. Using any excuse to not drill and help the working class. Those few drops would be produced by american workers and the government would get tax and royalties. It is a win win this government gets a new flow of money it can use to help push alternatives or even help pay for the 10 trillion in debt we have.

It will be atleast 5-7 years after a real alternative is found before the working class will be able to get on board. That is when middle class people will start trading in first generation alternative cars and the working class can buy them used.

Actually, there are countless better ways, including 'expensive social programs', but not limited to them.

You can't use such a small amount of oil to bridge any gaps unless you intend to shield it from the world market.

There is a lot of money to be made drilling that oil, but it isn't going to help the people you think it will.

The 'real alternative' is already here; subcompacts, hybrids, electric cars/bikes/scooters, public transit. Just because something better may come along doesn't mean there are no options today. All it takes is enough financial incentive to make it 'worthwhile', and what you are talking about is trying to remove that incentive, which is a terrible idea.

Fortunately for us all, your plan won't work anyway.

 

[quest55720]

Originally posted by: 3chordcharlie

Originally posted by: quest55720
Actually there is no better way to help them with out bankrupting the country with some massive social program. The oil companies would foot the bill to get the wells up and running. The government could use its money to develop and give insentives for alternatives. The drilling would help bridge us till we find a real alternative which could take a long long time.

I love how the obama people say a few drops. Using any excuse to not drill and help the working class. Those few drops would be produced by american workers and the government would get tax and royalties. It is a win win this government gets a new flow of money it can use to help push alternatives or even help pay for the 10 trillion in debt we have.

It will be atleast 5-7 years after a real alternative is found before the working class will be able to get on board. That is when middle class people will start trading in first generation alternative cars and the working class can buy them used.

Actually, there are countless better ways, including 'expensive social programs', but not limited to them.

You can't use such a small amount of oil to bridge any gaps unless you intend to shield it from the world market.

There is a lot of money to be made drilling that oil, but it isn't going to help the people you think it will.

The 'real alternative' is already here; subcompacts, hybrids, electric cars/bikes/scooters, public transit. Just because something better may come along doesn't mean there are no options today. All it takes is enough financial incentive to make it 'worthwhile', and what you are talking about is trying to remove that incentive, which is a terrible idea.

Fortunately for us all, your plan won't work anyway.

Hybrids way to expensive for the working class right now. Even used ones are way over priced.

Electic is useless in the north during the winter. You would be lucky to get out of the drive way in january.

Bikes/scooters are nice if you are single and have great health insurance and summer only.

Subcompacts almost all the current ones don't get good enough MPG to justify spending 10k to buy one. If you are talking used and old well that is complete waste of time since older subcompacts mpg suck in general.

Public transperation is ok if you live in a large city. Worthless for those in rural areas or in smaller cities with bad public transperation.


Can we take your financial insentive and put it towards other areas like health care? Double or tripple the cost of insurance to get people on diets?

This is all about appeasing the tree huggers plain and simple at the cost of the working class. I just wish you Obama people would just admit it. You are willing to thow the working class over board to appease the tree huggers. Just admit you are willing to break a few eggs to make an omlette.

 

[CycloWizard]

Originally posted by: 3chordcharlie
There is really no such thing as perfectly inelastic demand. In economics, elastic and inelastic are used to describe the degree to which one quantitative measure responds to changes in another. Gas would be considered quite inelastic in the short-run, because when the price changes today, you still have to go through with your plans for tomorrow (like going to work). People can't make drastic changes immediately, so demand for commodities tends to be inelastic in the short term. If the price of gas fell to $1/gallon tomorrow, thousands of people would still drive their Prius to work, because they hadn't had time to trade it in on the Ford Explorer they could now comfortably afford to drive.

'What something is worth' is a nebulous concept, and many people have guns to their heads all the time, especially in today-tomorrow-next-week time-frame.

Try to think of it this way: No matter the price of gas, you will drive to work tomorrow, in whatever vehicle it is that you drive. You will do this because you need to, and you would do it (for one day) even if the gas cost more than your pay. We can be pretty sure of this, because most of us, for one of our teenage jobs, had circumstances that forced us to spend more than our lousy pay on a cab-ride to make a shift. (Broken car, unreliable ride, missed the bus, slept in, whatever).

Obviously this is an unsustainable situation, so people make changes (Over the last 4 months, North America has stopped buying trucks and SUVs as commuter vehicles). Since what is sold at gas stations isn't really 'gas' but 'mobility', the price is actually different for every single purchaser: While the little 250cc bike at the pump is busy buying 200miles for $8, the contractor is buying 250 miles worth of towing 10,000lbs for $150 in his F350, and the middle-manager is paying $100 for 300 miles in his Sierra (while looking enviously at the bike, and hoping his wife finds a nice Civic for them to buy soon).

At any given time, most people can't just run out and buy a new vehicle today, or move tomorrow, or change jobs by Monday. In the weeks-months-years timeframe, people will respond to sustained high prices, and you will get a good idea of what they actually think gas is 'worth'.

Some people can make sudden changes to their plans. The problem is that people have decided, at some point, to live a lifestyle which depends on cheap gas. Changing the price doesn't change the responsibility associated with that choice. If gas goes to $10 tomorrow, I will not drive to work - I'll hop on my bike, despite the fact that I own a Prius and it's only 3 miles to work. I know that gas at that price is out of my budget and, therefore, can't be bought sustainably.

Of course, this is a possibility for me because I chose to live somewhere near my workplace four years ago when I moved here. I made some tradeoffs to live here (e.g. it's not a trendy part of town), but I had my priorities and my budget and I actually stuck to them. I appreciate that most Americans are much more myopic and were more interested in living the current revision of the American Dream (i.e. spending a lot of money you don't have to live a lifestyle way beyond your means). And I agree that this does make it harder for them to change their plans on a short timescale and I see how that would contribute to a relatively short-lived price increase.

 

[3chordcharlie]

Originally posted by: quest55720

Originally posted by: 3chordcharlie

Originally posted by: quest55720
Actually there is no better way to help them with out bankrupting the country with some massive social program. The oil companies would foot the bill to get the wells up and running. The government could use its money to develop and give insentives for alternatives. The drilling would help bridge us till we find a real alternative which could take a long long time.

I love how the obama people say a few drops. Using any excuse to not drill and help the working class. Those few drops would be produced by american workers and the government would get tax and royalties. It is a win win this government gets a new flow of money it can use to help push alternatives or even help pay for the 10 trillion in debt we have.

It will be atleast 5-7 years after a real alternative is found before the working class will be able to get on board. That is when middle class people will start trading in first generation alternative cars and the working class can buy them used.

Actually, there are countless better ways, including 'expensive social programs', but not limited to them.

You can't use such a small amount of oil to bridge any gaps unless you intend to shield it from the world market.

There is a lot of money to be made drilling that oil, but it isn't going to help the people you think it will.

The 'real alternative' is already here; subcompacts, hybrids, electric cars/bikes/scooters, public transit. Just because something better may come along doesn't mean there are no options today. All it takes is enough financial incentive to make it 'worthwhile', and what you are talking about is trying to remove that incentive, which is a terrible idea.

Fortunately for us all, your plan won't work anyway.

Hybrids way to expensive for the working class right now. Even used ones are way over priced.

Electic is useless in the north during the winter. You would be lucky to get out of the drive way in january.

Bikes/scooters are nice if you are single and have great health insurance and summer only.

Subcompacts almost all the current ones don't get good enough MPG to justify spending 10k to buy one. If you are talking used and old well that is complete waste of time since older subcompacts mpg suck in general.

Public transperation is ok if you live in a large city. Worthless for those in rural areas or in smaller cities with bad public transperation.


Can we take your financial insentive and put it towards other areas like health care? Double or tripple the cost of insurance to get people on diets?

This is all about appeasing the tree huggers plain and simple at the cost of the working class. I just wish you Obama people would just admit it. You are willing to thow the working class over board to appease the tree huggers. Just admit you are willing to break a few eggs to make an omlette.

You've successfully explained why each of the currently available options does not work for everyone.

In fact, it's quite clear that the poor northern rural married farmer who doesn't like small cars is pretty much SOL here. As for everyone else, they have options. As for your last comment, I don't even know what you're trying to say, and I'm not sure if you know, either.

 

[3chordcharlie]

Originally posted by: CycloWizard

Originally posted by: 3chordcharlie
There is really no such thing as perfectly inelastic demand. In economics, elastic and inelastic are used to describe the degree to which one quantitative measure responds to changes in another. Gas would be considered quite inelastic in the short-run, because when the price changes today, you still have to go through with your plans for tomorrow (like going to work). People can't make drastic changes immediately, so demand for commodities tends to be inelastic in the short term. If the price of gas fell to $1/gallon tomorrow, thousands of people would still drive their Prius to work, because they hadn't had time to trade it in on the Ford Explorer they could now comfortably afford to drive.

'What something is worth' is a nebulous concept, and many people have guns to their heads all the time, especially in today-tomorrow-next-week time-frame.

Try to think of it this way: No matter the price of gas, you will drive to work tomorrow, in whatever vehicle it is that you drive. You will do this because you need to, and you would do it (for one day) even if the gas cost more than your pay. We can be pretty sure of this, because most of us, for one of our teenage jobs, had circumstances that forced us to spend more than our lousy pay on a cab-ride to make a shift. (Broken car, unreliable ride, missed the bus, slept in, whatever).

Obviously this is an unsustainable situation, so people make changes (Over the last 4 months, North America has stopped buying trucks and SUVs as commuter vehicles). Since what is sold at gas stations isn't really 'gas' but 'mobility', the price is actually different for every single purchaser: While the little 250cc bike at the pump is busy buying 200miles for $8, the contractor is buying 250 miles worth of towing 10,000lbs for $150 in his F350, and the middle-manager is paying $100 for 300 miles in his Sierra (while looking enviously at the bike, and hoping his wife finds a nice Civic for them to buy soon).

At any given time, most people can't just run out and buy a new vehicle today, or move tomorrow, or change jobs by Monday. In the weeks-months-years timeframe, people will respond to sustained high prices, and you will get a good idea of what they actually think gas is 'worth'.

Some people can make sudden changes to their plans. The problem is that people have decided, at some point, to live a lifestyle which depends on cheap gas. Changing the price doesn't change the responsibility associated with that choice. If gas goes to $10 tomorrow, I will not drive to work - I'll hop on my bike, despite the fact that I own a Prius and it's only 3 miles to work. I know that gas at that price is out of my budget and, therefore, can't be bought sustainably.

Of course, this is a possibility for me because I chose to live somewhere near my workplace four years ago when I moved here. I made some tradeoffs to live here (e.g. it's not a trendy part of town), but I had my priorities and my budget and I actually stuck to them. I appreciate that most Americans are much more myopic and were more interested in living the current revision of the American Dream (i.e. spending a lot of money you don't have to live a lifestyle way beyond your means). And I agree that this does make it harder for them to change their plans on a short timescale and I see how that would contribute to a relatively short-lived price increase.

Of course if we're going to talk about market-wide effects, we can really only talk about aggregate actions.

'On average', people have not previously chosen to live close to where they work. In fact I recall people in the past five years (though not the past one) telling me they would never want to live LESS than 30 miles (50km for us Canadians) from work. Personally, I hate commuting, and consider the perfect commute to be about as long as it takes to get far enough from work that I can't see it anymore. But I'm not really representative of the average worker in that sense, either.

 

[quest55720]

Originally posted by: 3chordcharlie

Originally posted by: quest55720

Originally posted by: 3chordcharlie

Originally posted by: quest55720
Actually there is no better way to help them with out bankrupting the country with some massive social program. The oil companies would foot the bill to get the wells up and running. The government could use its money to develop and give insentives for alternatives. The drilling would help bridge us till we find a real alternative which could take a long long time.

I love how the obama people say a few drops. Using any excuse to not drill and help the working class. Those few drops would be produced by american workers and the government would get tax and royalties. It is a win win this government gets a new flow of money it can use to help push alternatives or even help pay for the 10 trillion in debt we have.

It will be atleast 5-7 years after a real alternative is found before the working class will be able to get on board. That is when middle class people will start trading in first generation alternative cars and the working class can buy them used.

Actually, there are countless better ways, including 'expensive social programs', but not limited to them.

You can't use such a small amount of oil to bridge any gaps unless you intend to shield it from the world market.

There is a lot of money to be made drilling that oil, but it isn't going to help the people you think it will.

The 'real alternative' is already here; subcompacts, hybrids, electric cars/bikes/scooters, public transit. Just because something better may come along doesn't mean there are no options today. All it takes is enough financial incentive to make it 'worthwhile', and what you are talking about is trying to remove that incentive, which is a terrible idea.

Fortunately for us all, your plan won't work anyway.

Hybrids way to expensive for the working class right now. Even used ones are way over priced.

Electic is useless in the north during the winter. You would be lucky to get out of the drive way in january.

Bikes/scooters are nice if you are single and have great health insurance and summer only.

Subcompacts almost all the current ones don't get good enough MPG to justify spending 10k to buy one. If you are talking used and old well that is complete waste of time since older subcompacts mpg suck in general.

Public transperation is ok if you live in a large city. Worthless for those in rural areas or in smaller cities with bad public transperation.


Can we take your financial insentive and put it towards other areas like health care? Double or tripple the cost of insurance to get people on diets?

This is all about appeasing the tree huggers plain and simple at the cost of the working class. I just wish you Obama people would just admit it. You are willing to thow the working class over board to appease the tree huggers. Just admit you are willing to break a few eggs to make an omlette.

You've successfully explained why each of the currently available options does not work for everyone.

In fact, it's quite clear that the poor northern rural married farmer who doesn't like small cars is pretty much SOL here. As for everyone else, they have options. As for your last comment, I don't even know what you're trying to say, and I'm not sure if you know, either.

No I explained why it won't work for most working class people. This still does not cover the increased price of food and other goods. The higher fuel gets the more expensive food gets. My grocery bill has gone up 15-20% this summer.

You know exactly what I am say but are in denial mode. You and the Obama people are perfectly willing to screw over the working class of this country to make the tree huggers happy. I just hope the rest of the working class people figure this out before november. That or we will be bankrupted by Obama/Pelosi 10 dollar a gallon gas plan to ween us off of oil. Ween off of oil and right to horse and carriages since there is no alternative to oil at this moment.

 

[fskimospy]

Originally posted by: quest55720

No I explained why it won't work for most working class people. This still does not cover the increased price of food and other goods. The higher fuel gets the more expensive food gets. My grocery bill has gone up 15-20% this summer.

You know exactly what I am say but are in denial mode. You and the Obama people are perfectly willing to screw over the working class of this country to make the tree huggers happy. I just hope the rest of the working class people figure this out before november. That or we will be bankrupted by Obama/Pelosi 10 dollar a gallon gas plan to ween us off of oil. Ween off of oil and right to horse and carriages since there is no alternative to oil at this moment.

Where are you getting this stuff from? You are off in la-la land. Please cite some sources showing that Obama is beholden to the 'tree huggers' at the expense of the working class. Please also cite some sources that show how Obama and Pelosi's gas plan (that doesn't exist) is going to lead to $10 gasoline.

Either that or just admit you're raving like a lunatic.

 

[quest55720]

Originally posted by: 3chordcharlie

Originally posted by: CycloWizard

Originally posted by: 3chordcharlie
There is really no such thing as perfectly inelastic demand. In economics, elastic and inelastic are used to describe the degree to which one quantitative measure responds to changes in another. Gas would be considered quite inelastic in the short-run, because when the price changes today, you still have to go through with your plans for tomorrow (like going to work). People can't make drastic changes immediately, so demand for commodities tends to be inelastic in the short term. If the price of gas fell to $1/gallon tomorrow, thousands of people would still drive their Prius to work, because they hadn't had time to trade it in on the Ford Explorer they could now comfortably afford to drive.

'What something is worth' is a nebulous concept, and many people have guns to their heads all the time, especially in today-tomorrow-next-week time-frame.

Try to think of it this way: No matter the price of gas, you will drive to work tomorrow, in whatever vehicle it is that you drive. You will do this because you need to, and you would do it (for one day) even if the gas cost more than your pay. We can be pretty sure of this, because most of us, for one of our teenage jobs, had circumstances that forced us to spend more than our lousy pay on a cab-ride to make a shift. (Broken car, unreliable ride, missed the bus, slept in, whatever).

Obviously this is an unsustainable situation, so people make changes (Over the last 4 months, North America has stopped buying trucks and SUVs as commuter vehicles). Since what is sold at gas stations isn't really 'gas' but 'mobility', the price is actually different for every single purchaser: While the little 250cc bike at the pump is busy buying 200miles for $8, the contractor is buying 250 miles worth of towing 10,000lbs for $150 in his F350, and the middle-manager is paying $100 for 300 miles in his Sierra (while looking enviously at the bike, and hoping his wife finds a nice Civic for them to buy soon).

At any given time, most people can't just run out and buy a new vehicle today, or move tomorrow, or change jobs by Monday. In the weeks-months-years timeframe, people will respond to sustained high prices, and you will get a good idea of what they actually think gas is 'worth'.

Some people can make sudden changes to their plans. The problem is that people have decided, at some point, to live a lifestyle which depends on cheap gas. Changing the price doesn't change the responsibility associated with that choice. If gas goes to $10 tomorrow, I will not drive to work - I'll hop on my bike, despite the fact that I own a Prius and it's only 3 miles to work. I know that gas at that price is out of my budget and, therefore, can't be bought sustainably.

Of course, this is a possibility for me because I chose to live somewhere near my workplace four years ago when I moved here. I made some tradeoffs to live here (e.g. it's not a trendy part of town), but I had my priorities and my budget and I actually stuck to them. I appreciate that most Americans are much more myopic and were more interested in living the current revision of the American Dream (i.e. spending a lot of money you don't have to live a lifestyle way beyond your means). And I agree that this does make it harder for them to change their plans on a short timescale and I see how that would contribute to a relatively short-lived price increase.

Of course if we're going to talk about market-wide effects, we can really only talk about aggregate actions.

'On average', people have not previously chosen to live close to where they work. In fact I recall people in the past five years (though not the past one) telling me they would never want to live LESS than 30 miles (50km for us Canadians) from work. Personally, I hate commuting, and consider the perfect commute to be about as long as it takes to get far enough from work that I can't see it anymore. But I'm not really representative of the average worker in that sense, either.

You mean people don't want to live in bad neighborhoods. Maybe the closest nice place to live they can afford is 30 miles from work. I hate my commute but it beats having to worry about being mugged or worse every time you step outside.

 

[3chordcharlie]

Originally posted by: quest55720

No I explained why it won't work for most working class people.

You did nothing of the sort; try again.

This still does not cover the increased price of food and other goods. The higher fuel gets the more expensive food gets. My grocery bill has gone up 15-20% this summer.

Mine has gone up more. It's caused me to drink less beer, and kept me to only a couple of rounds of golf this year (certainly my favourite summer hobby). Do you assume that I am independantly wealthy, and simply preaching at you from my Ivory Tower? I'm not, and I'm not.

You know exactly what I am say but are in denial mode. You and the Obama people are perfectly willing to screw over the working class of this country to make the tree huggers happy. I just hope the rest of the working class people figure this out before november. That or we will be bankrupted by Obama/Pelosi 10 dollar a gallon gas plan to ween us off of oil. Ween off of oil and right to horse and carriages since there is no alternative to oil at this moment.

I'm not totally sure, but I think you're now blaming Obama for the high oil prices in the last three years of Bush's presidency. That's quite an accomplishment if Barack has really managed to pull that off.

You really, fundamentally don't understand what you're trying to lecture me about, so if we're going to keep having this discussion, we'll need a better argument for you to use.

 

[3chordcharlie]

Originally posted by: quest55720

You mean people don't want to live in bad neighborhoods. Maybe the closest nice place to live they can afford is 30 miles from work. I hate my commute but it beats having to worry about being mugged or worse every time you step outside.

People live all over the place, and there are employers all over the place. The 'cost' of living 30 miles from work is going up, and people will need to consider that cost more and more over time. It is certainly not carved in stone that everyone's employer is located 30 miles from the nearest safe neighborhood.

 

[quest55720]

Originally posted by: 3chordcharlie

Originally posted by: quest55720

No I explained why it won't work for most working class people.

You did nothing of the sort; try again.

This still does not cover the increased price of food and other goods. The higher fuel gets the more expensive food gets. My grocery bill has gone up 15-20% this summer.

Mine has gone up more. It's caused me to drink less beer, and kept me to only a couple of rounds of golf this year (certainly my favourite summer hobby). Do you assume that I am independantly wealthy, and simply preaching at you from my Ivory Tower? I'm not, and I'm not.

You know exactly what I am say but are in denial mode. You and the Obama people are perfectly willing to screw over the working class of this country to make the tree huggers happy. I just hope the rest of the working class people figure this out before november. That or we will be bankrupted by Obama/Pelosi 10 dollar a gallon gas plan to ween us off of oil. Ween off of oil and right to horse and carriages since there is no alternative to oil at this moment.

I'm not totally sure, but I think you're now blaming Obama for the high oil prices in the last three years of Bush's presidency. That's quite an accomplishment if Barack has really managed to pull that off.

You really, fundamentally don't understand what you're trying to lecture me about, so if we're going to keep having this discussion, we'll need a better argument for you to use.

I am blaming him for not wanting to be part of the solution with an energy policy that could of been writen by the Sierra Club . I blame him for not calling out pelosi and telling her to get back to work and get this solved. I blame him for choosing tree huggers over the working class. His party was in control of congress when these prices got out of control and still has done nothing to help. He off jet setting on vacation while the people of the country suffer.

 

[Vic]

Originally posted by: quest55720
I am blaming him for not wanting to be part of the solution with an energy policy that could of been writen by the Sierra Club . I blame him for not calling out pelosi and telling her to get back to work and get this solved. I blame him for choosing tree huggers over the working class. His party was in control of congress when these prices got out of control and still has done nothing to help. He off jet setting on vacation while the people of the country suffer.

Gas prices have been 'out of control' since long before the Dems got that slim majority in Congress last year. My whole life, I never paid over $2/gal until '03, and I haven't paid under that since either.

I swear, the influx of idiotic talking point-parroting partisan trolls the past couple months have literally ruined this forum. Go the hell back to freep or wherever you came from.

Gas prices jumped up this year due to unchecked speculation and Bush's saber-rattling with Iran. Period. Those conditions have now changed, hence gas and oil prices are now going down fast. Unfortunately for the oil companies, too fast for their useful idiots (you including) to use the situation to get them major concessions to manipulate their stock prices with.

You wanna discuss that instead of your fictional partisan talking points, that would be appreciated. Otherwise, :roll:

 

[dmcowen674]

Originally posted by: Vic

Originally posted by: quest55720
I am blaming him for not wanting to be part of the solution with an energy policy that could of been writen by the Sierra Club . I blame him for not calling out pelosi and telling her to get back to work and get this solved. I blame him for choosing tree huggers over the working class. His party was in control of congress when these prices got out of control and still has done nothing to help. He off jet setting on vacation while the people of the country suffer.

Gas prices have been 'out of control' since long before the Dems got that slim majority in Congress last year. My whole life, I never paid over $2/gal until '03, and I haven't paid under that since either.

I swear, the influx of idiotic talking point-parroting partisan trolls the past couple months have literally ruined this forum. Go the hell back to freep or wherever you came from.

Gas prices jumped up this year due to unchecked speculation and Bush's saber-rattling with Iran. Period. Those conditions have now changed, hence gas and oil prices are now going down fast. Unfortunately for the oil companies, too fast for their useful idiots (you including) to use the situation to get them major concessions to manipulate their stock prices with.

You wanna discuss that instead of your fictional partisan talking points, that would be appreciated. Otherwise, :roll:

Not to worry.

All the extra oil is apparently instantly gone for use in tanks in the Russia-Georgia war.

Pay up

 

[Vic]

Originally posted by: quest55720
You mean people don't want to live in bad neighborhoods. Maybe the closest nice place to live they can afford is 30 miles from work. I hate my commute but it beats having to worry about being mugged or worse every time you step outside.

All you're telling us here is that your city sucks if the "closest nice place to live" that's also affordable means being forced into a 30 mile one-way commute.

 

[quest55720]

Originally posted by: Vic

Originally posted by: quest55720
I am blaming him for not wanting to be part of the solution with an energy policy that could of been writen by the Sierra Club . I blame him for not calling out pelosi and telling her to get back to work and get this solved. I blame him for choosing tree huggers over the working class. His party was in control of congress when these prices got out of control and still has done nothing to help. He off jet setting on vacation while the people of the country suffer.

Gas prices have been 'out of control' since long before the Dems got that slim majority in Congress last year. My whole life, I never paid over $2/gal until '03, and I haven't paid under that since either.

I swear, the influx of idiotic talking point-parroting partisan trolls the past couple months have literally ruined this forum. Go the hell back to freep or wherever you came from.

Gas prices jumped up this year due to unchecked speculation and Bush's saber-rattling with Iran. Period. Those conditions have now changed, hence gas and oil prices are now going down fast. Unfortunately for the oil companies, too fast for their useful idiots (you including) to use the situation to get them major concessions to manipulate their stock prices with.

You wanna discuss that instead of your fictional partisan talking points, that would be appreciated. Otherwise, :roll:

Gas jumped up well over 3 dollars a gallon last year also. I don't recall anyone asking for tax breaks for the oil companies. If you consider auctioning off land with known oil reserves and putting americans to work a concession then give it to them now. If putting money into the pockets of both state and federal government is concessions then give it to them now. It sure beats the alternative which is people suffering waiting for that alternative to be invented and brought to market.

I don't support either party since they both suck. One is run by the bible thumpers the other is run by the extreme left tree huggers. I will vote for who ever will give me a complete energy plan that includes higher MPG standards,coal,alternatives,renewables, nuclear and drilling.

 

[charrison]

Originally posted by: Vic

Originally posted by: quest55720
I am blaming him for not wanting to be part of the solution with an energy policy that could of been writen by the Sierra Club . I blame him for not calling out pelosi and telling her to get back to work and get this solved. I blame him for choosing tree huggers over the working class. His party was in control of congress when these prices got out of control and still has done nothing to help. He off jet setting on vacation while the people of the country suffer.

Gas prices have been 'out of control' since long before the Dems got that slim majority in Congress last year. My whole life, I never paid over $2/gal until '03, and I haven't paid under that since either.

I swear, the influx of idiotic talking point-parroting partisan trolls the past couple months have literally ruined this forum. Go the hell back to freep or wherever you came from.

Gas prices jumped up this year due to unchecked speculation and Bush's saber-rattling with Iran. Period. Those conditions have now changed, hence gas and oil prices are now going down fast. Unfortunately for the oil companies, too fast for their useful idiots (you including) to use the situation to get them major concessions to manipulate their stock prices with.

You wanna discuss that instead of your fictional partisan talking points, that would be appreciated. Otherwise, :roll:

Speculation and sabor rattling with Iran? That might play a roll, but the reality is world demand for oil is way up. Not only is demand way up, we are just out of period where oil was so cheap there was a lack of investment in oilfields. For instance mexico exports are off 25% and falling for this reason. Indonesia had to drop out of opec because of falling production and increased local consumption.

If you want to say speculation and iran caused high gas prices, you first have to admit global supply/demand has been very tight.

 

[CycloWizard]

Originally posted by: quest55720
You mean people don't want to live in bad neighborhoods. Maybe the closest nice place to live they can afford is 30 miles from work. I hate my commute but it beats having to worry about being mugged or worse every time you step outside.

Shens. I live in St. Louis, which will easily overtake Detroit this year to re-take the crown for most violent city in the US. My neighborhood isn't perfect, but it's not bad either. It's only 5-6 miles from the river. If I move another 1/2 mile west, I would be perfectly safe.

 

[Thump553]

In an attempt to get this thread back on topic, I note the following:

-over the weekend, armed conflict broke out between Russia & Georgia and Russia bombed the oil pipeline going through Georgia. USA was very much a backer of this pipeline, and it's shutdown gives Russia far more control over the world's oil supply.

-As of right now, that armed conflict continues.

-After a brief jump up this morning (Monday), oil is now down for the day-and trading at it's lowest level since May.

This is pretty solid empirical evidence to me that the oil increases of the past several months were driven primarily by speculation, and had little to do with supply and demand. Comments? (on topic please)

 

[Queasy]

Originally posted by: Thump553
This is pretty solid empirical evidence to me that the oil increases of the past several months were driven primarily by speculation, and had little to do with supply and demand. Comments? (on topic please)

The recent drop has more to do with a decrease in demand from Western countries (especially the US) and with a weakening Euro and strengthening dollar.