<< <i>Politicians don't control the price of oil. They do control foreign policy. Failed foreign policy dictates that we pay more than we should for imported oil. Price of oil is dictated by a foreign cartel. Failure to appropriately deal with their price fixing is why we pay what we pay. >>
DerryB,
I really believe that just as JPmorgan, GoldmanSachs and the others are in so tight with Our Government you can't distinguish the difference between the two at times, I believe the same holds true for the huge Oil conglomerates. There is complicitness that runs very deep.
NumbersUsa, FairUs, Alipac, CapsWeb, and TeamAmericaPac
Pelosi is the problem, on so many levels that it's mind-numbing to busy yourself thinking of rebuttals to her hogwash. Which is the intention, I believe.
So much smoke is being created. She takes zero responsibility for anything and yet wants to "protect" us. That should be enough to end the debate.
Q: Are You Printing Money? Bernanke: Not Literally
Rising Gas prices is inflationary by nature of the increasing price based on dollars, but and a big but, It acts more like a heavy tax burden and
has the potential to suffocate a nations economy.
In fact, there are two ways to influence the oil speculators. One is speculators following inflationary forces. The second is speculation due to a reaction to some outside force. Inflation is caused by price rises due in most cases to an overheated economy. Are we in an overheated economy? I don't think so.
In this case the rise in the price in oil is due to a speculation based on Iran cutting off oil to France and England. Of course, France and England are going to embargo Iran, so it is a political quid-pro-quo. Failed foreign policy? That seems a bit parochial to the worldwide situation.
There is very little inflation right now and higher oil will cause a drag on the economy. I think it is a negative for gold and silver.
You know, I read the debate here, listen to it on the "news," talk about it at work...yet I am still sacrificing vacations, food, and other "discretionary" items in my budget to simply get back and forth to work.
Enough already! I get hammered for not having a Plan A, B AND C, so here's my suggestion:
Plan A: Drill, Drill, Drill Plan B: Reduce Taxes Plan C: Develop alternative energies (and make a frickin' hybrid or electric car CHEAPER than gas cars, duh!)
Run all 3 in parallel, not either or...then let the market decide which is better.
Plan A: Drill, Drill, Drill Plan B: Reduce Taxes Plan C: Develop alternative energies (and make a frickin' hybrid or electric car CHEAPER than gas cars, duh!)
Better to build more refining capacity than drill for more. Adding surplus to a system at capacity doesn't help the output. Also, the price is not driven by supply and demand it is driven by speculators, both in the cartels and Chicago Board of Trade and the London equivalent. The president can knock down the price by threatening to sell strategic reserves cheap, but he can't do that every time or it won't have the desired effect.
The state sales taxes on gas usually go to road improvements. If they don't, they should. If it is not collected at the pump, they'll get it from you somewhere else.
The higher gas prices go, the better those cancelled high-speed rail projects look.
The main speculator is our old friend Helicopter Ben , I think. The fed is doing the speculating and oil prices are a side effect of money printing QE 1, 2,3 ,operation twist, whatever its called. Everything else is going up why hasn't oil already gone up more than this ?
Let's see how corrupt our system is. I will be surprised if it is ever implemented even when the economy can come tumbling down. Wall Street above all others as usual.
Better to build more refining capacity than drill for more. Adding surplus to a system at capacity doesn't help the output. Also, the price is not driven by supply and demand it is driven by speculators, both in the cartels and Chicago Board of Trade and the London equivalent.
Dozens of US refineries were closed in the 1980's and 1990's because the economics of meeting cafe' standards for gasoline and new environmental standards drove many of them out of business. In the late 1990's and up to the mid 2000's, several refineries were upgraded for low sulfur fuels and expanded in capacity as well. I'm not sure what the refinery utilization rate is right now, but if the financial incentive is there, the oil companies will invest. If not, they won't. It's pretty straightforward.
Price is driven by both supply and demand. In the late 1970's demand dropped because of the oil embargo, and sure enough the prices dropped like a stone. Speculation won't sustain high prices for very long. When oil hit $140 a few years ago, the main speculator was bankrupted when the Saudis remarked that oil ought to be somewhere in the mid $80's. Oil is priced with politics as much as anything else, but speculation is a normal part of the market price discovery process and the only role government should have is to enforce fair dealings.
The government has failed pretty badly to bring honesty and transparency to both banking and housing, so there is no reason to think that government would do any better in the energy markets - in fact the pattern of governmental failure is already obvious there, too.
Q: Are You Printing Money? Bernanke: Not Literally
"Interest rates, the price of money, are the most important market. And, perversely, they’re the market that’s most manipulated by the Fed." - Doug Casey
Patrick Daniel, chairman of Enbridge Energy (a major pipeline out of Edmonton) will be on CNBC tonight. He will apparently be talking about Keystone. I didn't catch the time. It might be illuminating for those who aren't familiar with the pipeline industry.
Q: Are You Printing Money? Bernanke: Not Literally
<< <i>Isn't the price of gas directy related to our dependency on it? We are all slaves to the internal combustion engine and the fuel companies know this. If fuel consumption dropped by 50%, what would happen to prices? >>
They would come down until supplies were used up and then the oil companies would squeeze supplies and raise prices. Do you think they care if they sell 4 gallons at $2 per gallon or 2 gallons at $4 per gallon? Or they will process just enough capacity to make a profit and run the refinery with minimum efficiency. Right now the only thing more plentiful than crude oil is water. As long as there are adequate supplies of crude things won't change; "necessity is the mother of invention" comes to mind.
1) A very small change in oil demand or supply causes a very large change in Price. Think about a 1/2% change causing a huge change in price. This is why oil is a boom/bust industry. No complaining about the boom, unless you are prepared to fight the bust, too. In my lifetime, no one has ponied up in the busts.
2) Refining belongs where the oil production is. When USA production declined, refineries that lacked the economics to upgrade to comply with modern pollution laws were closed.
3) Big Oil, if one existed, sold out of America in the 1980's and 1990's. Several have bought back in over the last 3-4 years, for various reasons.
4) Thanks for the huge laugh on Republicans still controlling the price of oil.
They would come down until supplies were used up and then the oil companies would squeeze supplies and raise prices. Do you think they care if they sell 4 gallons at $2 per gallon or 2 gallons at $4 per gallon? Or they will process just enough capacity to make a profit and run the refinery with minimum efficiency. Right now the only thing more plentiful than crude oil is water. As long as there are adequate supplies of crude things won't change; "necessity is the mother of invention" comes to mind.
Whether or not you think we've reached "peak oil", it's a finite resource and it will eventually be gone. I don't see that as the issue. I see the issue as, "what is the most intelligent approach to energy policy?"
Why would any company want to run their refinery at minimum efficiency? That's a money-loser. As much as any oil company would like to improve their margins, they still have to compete. Gasoline is about the most competitive market that exists, at every level. It's a world market now - not at all like the 1950's & 1960's when the "Seven Sisters" could manipulate prices.
Any effort by a government to dictate pricing or supply to the oil market will end up looking as foolish as it is.
Crude oil is only as plentiful as there is access to it. In this country, access is being restricted by the government. This is about the dumbest move a government can make, because there is no such restriction on the Chinese or Indian or British or Japanese or even Russian - or most other expanding economies. Our government is intent on forcing Americans to use less oil. This will allow every other country to expand their economy while ours continues to shrink and struggle.
The oil market isn't going to sit around and wait for the US to decide whether or not the US wants to use oil. The oil is going to get used, no matter what the "government planners" here in the US want.
The world has already decided that oil is the most efficient energy source. While we see the smokestacks from China rising all over their country, is our EPA now going to mandate that they stop polluting? After all, we share the same air and water molecules. Competition exists whether anyone wants it to exist or not. The sooner the utopians realize it, the better off we will be.
This is why gold and silver will continue to "do well" in relation to the dollar. There are no policies in place right now that help the dollar in world trade. This is especially true in the energy markets. If Solyndra was going to be viable, it would have made it on its own and wouldn't have needed ANY taxpayer money. Same goes for the Volt, and wind farms too. They will have their day, but it's not any time soon. And they won't need our government to finance them when they do.
To address the OP, high gas prices aren't really causal in terms of gold & silver prices, but I would say that they are coincidental - mainly because of government actions.
Q: Are You Printing Money? Bernanke: Not Literally
Here's where your big increase is coming from, and luckily for the US, the government hasn't yet put restrictions on this production field - whose development was well-underway before 2008 and continues to increase.
Q: Are You Printing Money? Bernanke: Not Literally
A true supply shortage has not been an issue for a rather long time, say since 1974. The issue is an industry that has masterd the market through many and varied tentacales, including Government collusion, of which this administration though with mouth denies, but by action and lack of action is overtly complicit.
Any long term increase in taxes are not good for the economy as whole and not for Pm's in specific. Rising Gas prices in effect act more as a tax than an increase in inflation.
NumbersUsa, FairUs, Alipac, CapsWeb, and TeamAmericaPac
<<The point is that domestic supply is not our problem at the moment and any one who makes that argument doesn't know what they are talking about. >>
The POTUS evidently thinks that supply is the problem when he releases SOR oil and whines to the Saudis to increase production in an attempt to affect prices. So, it is clear that he doesn't know what he is talking about.
I stated my opinion about the OP question already, so I'll bow out now.
Q: Are You Printing Money? Bernanke: Not Literally
The POTUS evidently thinks that supply is the problem when he releases SOR oil and whines to the Saudis to increase production in an attempt to affect prices
It's always interesting to look back on older threads and read the comments and see who got it right and who got it wrong.. I missed this thread first time around (was on vacation in the Virgin Islands at the time) but since everyone is fairly predictable, it's not difficult to imagine what I would have said, and how it has played out in the time since vs the predictions
Gas is getting cheaper because of increased supply (The US is now producing more oil than we import for the first time in 20 years), decreased demand by more fuel efficient cars at home and slackening demand abroad. Expect this trend to continue for a while, in fits and starts, offset by probably increased taxes at the pump, but stabilizing around $3 nationwide, lower near the refineries generally, and more expensive in swanky urban areas and in lonely outposts where there is little or no competition on price.
<< <i>Gasoline prices down 30% since the OP. Prognostications for $5-6 gas not proven. >>
Great choice of timing for you rhetoric.... Hmmmm lets choose the high.. .and the low.... now 18 months later... to make... what point? You are so predictable.... BTW what were gas prices over the 18 months...bigger question for you.. what will they be in 12 months?
I view predictability as a positive trait as it fosters trust and integrity in both social and business relationships.
As far as your question and the point of the TTT, the answer can be found here..
Usually threads such as this are started near market highs as media attention and angst are widespread and predictions of ever increasing prices are commonplace. These are very typical human reactions and astute investors can learn how to play these emotions into better than average returns. Again im sorry if my attempts on exposing successful investing techniques fall on deaf ears.
Gasoline prices have been roughly between $3-4 for over 3 years now but that price range is compressing which probably means volatility will increase. However the chart is sideways and until that changes my predictions will be contained to assets that are much more timely. In other words, gasoline is much to boring to warrant my interest. Fundamentally I see nothing that would result in significantly higher prices.
Hmmmm lets choose the high.. .and the low.... now 18 months later... to make... what point? You are so predictable.
Yes, I am predictable in that I will always use fact to support a thought. In this case, click on this link and then chose the 10 yr graph. It is very easy to see that current prices are very near the 8 year average. I did not pick a high or low, but rather the average price spanning an economic boom, an economic bust, and a monetary policy experiment. Thats quite a lot of emotional, political, economic, and social variety that has resulted in stable pricing over a sustained period. I expect PMs to trace out a similar pattern.
Comments
<< <i>Politicians don't control the price of oil. They do control foreign policy. Failed foreign policy dictates that we pay more than we should for imported oil. Price of oil is dictated by a foreign cartel. Failure to appropriately deal with their price fixing is why we pay what we pay. >>
DerryB,
I really believe that just as JPmorgan, GoldmanSachs and the others are in so tight with Our Government you can't distinguish the difference between the two at times, I believe the same holds true for the huge Oil conglomerates. There is complicitness that runs very deep.
So much smoke is being created. She takes zero responsibility for anything and yet wants to "protect" us. That should be enough to end the debate.
I knew it would happen.
has the potential to suffocate a nations economy.
In fact, there are two ways to influence the oil speculators. One is speculators following inflationary forces. The second is speculation due to a reaction to some outside force. Inflation is caused by price rises due in most cases to an overheated economy. Are we in an overheated economy? I don't think so.
In this case the rise in the price in oil is due to a speculation based on Iran cutting off oil to France and England. Of course, France and England are going to embargo Iran, so it is a political quid-pro-quo. Failed foreign policy? That seems a bit parochial to the worldwide situation.
There is very little inflation right now and higher oil will cause a drag on the economy. I think it is a negative for gold and silver.
Enough already! I get hammered for not having a Plan A, B AND C, so here's my suggestion:
Plan A: Drill, Drill, Drill
Plan B: Reduce Taxes
Plan C: Develop alternative energies (and make a frickin' hybrid or electric car CHEAPER than gas cars, duh!)
Run all 3 in parallel, not either or...then let the market decide which is better.
Plan B: Reduce Taxes
Plan C: Develop alternative energies (and make a frickin' hybrid or electric car CHEAPER than gas cars, duh!)
Better to build more refining capacity than drill for more. Adding surplus to a system at capacity doesn't help the output. Also, the price is not driven by supply and demand it is driven by speculators, both in the cartels and Chicago Board of Trade and the London equivalent. The president can knock down the price by threatening to sell strategic reserves cheap, but he can't do that every time or it won't have the desired effect.
The state sales taxes on gas usually go to road improvements. If they don't, they should. If it is not collected at the pump, they'll get it from you somewhere else.
The higher gas prices go, the better those cancelled high-speed rail projects look.
The main speculator is our old friend Helicopter Ben , I think. The fed is doing the speculating and oil prices are a side effect of money printing QE 1, 2,3 ,operation twist, whatever its called. Everything else is going up why hasn't oil already gone up more than this ?
Let's see how corrupt our system is. I will be surprised if it is ever implemented even when the economy can come tumbling down. Wall Street above all others as usual.
Box of 20
Dozens of US refineries were closed in the 1980's and 1990's because the economics of meeting cafe' standards for gasoline and new environmental standards drove many of them out of business. In the late 1990's and up to the mid 2000's, several refineries were upgraded for low sulfur fuels and expanded in capacity as well. I'm not sure what the refinery utilization rate is right now, but if the financial incentive is there, the oil companies will invest. If not, they won't. It's pretty straightforward.
Price is driven by both supply and demand. In the late 1970's demand dropped because of the oil embargo, and sure enough the prices dropped like a stone. Speculation won't sustain high prices for very long. When oil hit $140 a few years ago, the main speculator was bankrupted when the Saudis remarked that oil ought to be somewhere in the mid $80's. Oil is priced with politics as much as anything else, but speculation is a normal part of the market price discovery process and the only role government should have is to enforce fair dealings.
The government has failed pretty badly to bring honesty and transparency to both banking and housing, so there is no reason to think that government would do any better in the energy markets - in fact the pattern of governmental failure is already obvious there, too.
I knew it would happen.
<< <i>Gotta love that when gas prices increased it was all Bush's fault and him wanting to enrich all of his oil buddy cronies.
Now with Obama in charge, well, $5/gallon gasoline really isn't that unreasonable.
Double standard much. >>
Can't you also say that when gas increased under Pres. Bush, Republicans said it was not the fault of Bush and blamed it on other factors?
Now that it is increasing under Pres. Obama, Republicans are saying it IS Obama's fault.
Works both ways. Double standard much?
Both are wrong and hypocritical.
Currency Wants: Any note with serial number 00000731
The market has spoken. High gasoline prices are good for PM's.
https://www.pcgs.com/setregistry/gold/liberty-head-2-1-gold-major-sets/liberty-head-2-1-gold-basic-set-circulation-strikes-1840-1907-cac/alltimeset/268163
"Interest rates, the price of money, are the most important market. And, perversely, they’re the market that’s most manipulated by the Fed." - Doug Casey
I knew it would happen.
Knowledge is the enemy of fear
<< <i>Isn't the price of gas directy related to our dependency on it?
We are all slaves to the internal combustion engine and the fuel companies know this.
If fuel consumption dropped by 50%, what would happen to prices? >>
They would come down until supplies were used up and then the oil companies would squeeze supplies and raise prices. Do you think they care if they sell 4 gallons at $2 per gallon or 2 gallons at $4 per gallon? Or they will process just enough capacity to make a profit and run the refinery with minimum efficiency. Right now the only thing more plentiful than crude oil is water. As long as there are adequate supplies of crude things won't change; "necessity is the mother of invention" comes to mind.
2) Refining belongs where the oil production is. When USA production declined, refineries that lacked the economics to upgrade to comply with modern pollution laws were closed.
3) Big Oil, if one existed, sold out of America in the 1980's and 1990's. Several have bought back in over the last 3-4 years, for various reasons.
4) Thanks for the huge laugh on Republicans still controlling the price of oil.
Whether or not you think we've reached "peak oil", it's a finite resource and it will eventually be gone. I don't see that as the issue. I see the issue as, "what is the most intelligent approach to energy policy?"
Why would any company want to run their refinery at minimum efficiency? That's a money-loser. As much as any oil company would like to improve their margins, they still have to compete. Gasoline is about the most competitive market that exists, at every level. It's a world market now - not at all like the 1950's & 1960's when the "Seven Sisters" could manipulate prices.
Any effort by a government to dictate pricing or supply to the oil market will end up looking as foolish as it is.
Crude oil is only as plentiful as there is access to it. In this country, access is being restricted by the government. This is about the dumbest move a government can make, because there is no such restriction on the Chinese or Indian or British or Japanese or even Russian - or most other expanding economies. Our government is intent on forcing Americans to use less oil. This will allow every other country to expand their economy while ours continues to shrink and struggle.
The oil market isn't going to sit around and wait for the US to decide whether or not the US wants to use oil. The oil is going to get used, no matter what the "government planners" here in the US want.
The world has already decided that oil is the most efficient energy source. While we see the smokestacks from China rising all over their country, is our EPA now going to mandate that they stop polluting? After all, we share the same air and water molecules. Competition exists whether anyone wants it to exist or not. The sooner the utopians realize it, the better off we will be.
This is why gold and silver will continue to "do well" in relation to the dollar. There are no policies in place right now that help the dollar in world trade. This is especially true in the energy markets. If Solyndra was going to be viable, it would have made it on its own and wouldn't have needed ANY taxpayer money. Same goes for the Volt, and wind farms too. They will have their day, but it's not any time soon. And they won't need our government to finance them when they do.
To address the OP, high gas prices aren't really causal in terms of gold & silver prices, but I would say that they are coincidental - mainly because of government actions.
I knew it would happen.
Looks like oil production is up!
I knew it would happen.
I knew it would happen.
Lifted from this page
I knew it would happen.
Any long term increase in taxes are not good for the economy as whole and not for Pm's in specific. Rising Gas prices in effect act more as a tax than an increase in inflation.
That was my original post question beside the effect on PM's.
The POTUS evidently thinks that supply is the problem when he releases SOR oil and whines to the Saudis to increase production in an attempt to affect prices. So, it is clear that he doesn't know what he is talking about.
I stated my opinion about the OP question already, so I'll bow out now.
I knew it would happen.
That would shake the speculators out. That's all.
Knowledge is the enemy of fear
Gas is getting cheaper because of increased supply (The US is now producing more oil than we import for the first time in 20 years), decreased demand by more fuel efficient cars at home and slackening demand abroad. Expect this trend to continue for a while, in fits and starts, offset by probably increased taxes at the pump, but stabilizing around $3 nationwide, lower near the refineries generally, and more expensive in swanky urban areas and in lonely outposts where there is little or no competition on price.
Liberty: Parent of Science & Industry
<< <i>Gasoline prices down 30% since the OP. Prognostications for $5-6 gas not proven. >>
Great choice of timing for you rhetoric.... Hmmmm lets choose the high.. .and the low.... now 18 months later... to make... what point? You are so predictable.... BTW what were gas prices over the 18 months...bigger question for you.. what will they be in 12 months?
As far as your question and the point of the TTT, the answer can be found here..
Usually threads such as this are started near market highs as media attention and angst are widespread and predictions of ever increasing prices are commonplace. These are very typical human reactions and astute investors can learn how to play these emotions into better than average returns. Again im sorry if my attempts on exposing successful investing techniques fall on deaf ears.
Gasoline prices have been roughly between $3-4 for over 3 years now but that price range is compressing which probably means volatility will increase. However the chart is sideways and until that changes my predictions will be contained to assets that are much more timely. In other words, gasoline is much to boring to warrant my interest. Fundamentally I see nothing that would result in significantly higher prices.
Knowledge is the enemy of fear
Yes, I am predictable in that I will always use fact to support a thought. In this case, click on this link and then chose the 10 yr graph. It is very easy to see that current prices are very near the 8 year average. I did not pick a high or low, but rather the average price spanning an economic boom, an economic bust, and a monetary policy experiment. Thats quite a lot of emotional, political, economic, and social variety that has resulted in stable pricing over a sustained period. I expect PMs to trace out a similar pattern.
Knowledge is the enemy of fear
very stable.