Fuel Prices

[Unit 5302]

Americans do not need a 5500lb Ford Expedition or Dodge Ram 4x4 that gets 13mpg as a commuter car. The SRT10 gets 9, yes, 9mpg in the city according to EPA estimates. 9 friggen miles per gallon.

Another thing. Americans live 20, 50, even 100 miles away from where they work.

If the citizens can't afford gas, it's time for a lifestyle change. I ride my motorcycles more. I live 3.5mi away from where I work and put less than 8000mi/yr on my Explorer, which gets between 17-24mpg. All city in the winter, 17. A mix is right around 19-20, and the freeway it gets about 23-24.

9mpg. That's ridiculous. Cars today getting 15mpg. About the same as my dad's old 1978 Lincoln Town Car with the 460ci V-8. 22ft long and 5000lbs with a 7.6L V-8 using 30 year old technology.

I do agree that the middle class is being exterminated as the gap between the rich and the poor accelerates.

[82 GT]

Don't hold your breathe for the suspension of gas taxes. I'll be an old man before that happens.
You're the first person who seem to be ok with the current fuel prices and believes that the prices will fall a significant amount after production picks up again.
Like I said, it's just not the price of gas, it's everything else that continues to go up while our paychecks stay the same.
That is what frustrates most Americans.
The economy has been a wreck for years now, regardless of what they tell you on TV, and probably will be for years to come.
Do you think Bush really cares about the economy especially after he will be out of office in two years?
You're very optimistic. I'll grant you that much.
I'm not freaking out about the gas prices. I'm just slowly learning how the goverment really works.

[Mr 5 0]

Originally Posted by 82 GT

Don't hold your breathe for the suspension of gas taxes. I'll be an old man before that happens.
You're the first person who seem to be ok with the current fuel prices and believes that the prices will fall a significant amount after production picks up again.

Not exactly.

I would love to be paying under $2.00 per gallon, just like you or anyone else. I would also love to be able to buy a new Mustang for the same price I paid for my '90 LX when I bought it new (about $14,000.) Neither one is going to happen. While I hate paying $40. for a fill-up that used to cost $25. a few short months ago I do not believe the price will remain at that high level and I see no point in getting all frenzied over it because that won't change anything...and I still have to have gas, just like anyone else.

Like I said, it's just not the price of gas, it's everything else that continues to go up while our paychecks stay the same.
That is what frustrates most Americans.

The inflation rate in the U.S. averages from 2 to almost 4%, annually. 2.5% is about average. Right now, the inflation rate stands at a bit over 3%. Most employers are aware of this and offer pay raises close to that amount, sometimes a little more. 2 to 3% is a very reasonable rate of inflation and part of the reason why our economy is doing so well. If your paycheck is staying the same on a yearly basis, you need to find a better job or aquire the skills and/or education that will allow you to find one.

I understand that having the cost of a necessary expense like gas suddenly go up 40 to 50% in a week or two is shocking and the first response tends to be anger born of frustration because you don't understand it and can't change it. That's natural. However, even at our generally low inflation rate, certain things will jump in price at various times for various reasons. Gas, being something most people use and need, is simply a more obvious manifestation of the natural cycle of supply and demand.

The economy has been a wreck for years now, regardless of what they tell you on TV, and probably will be for years to come.

I'm sorry but that is absolute rubbish and obviously stems from a gross lack of information and knowledge of our current economic status.

Over 4 million new jobs have been created in the past two years, 2.2 million in the past 12 months.

The U.S. unemployment rate is down to a record low (5%).

Overall, the U.S. economy is growing at well over 3%, annually, a very robust rate of growth.

New home sales are way up as are sales of durable goods and retail, so the myth that thely created jobs are simply 'burger-flipper' or Wal-Mart jobs is nonsense. You don't buy a new home at today's prices on a Wal-Mart or McDonald's paycheck.

That's what they don't 'tell you on TV'..because most of the news organizations, except Fox, are anti-Bush and don't want him to receive any credit for the economy...unless it's bad. THEN, they trumpet that bad news for days on end and are sure to link it directly to President Bush, as if he could single-handedly 'make' the economy be either good or bad. The media bias against Republicans and President Bush, specifically, is as contemptable as it is transparent.

The U.S. is one of the most prosperous nations in the world today and our economy is in very good shape, the best in some years. Even our ''poor' live far better than most people in countries that are realistically poor. If you are hurting economically I am sorry but foolishly blaming 'the government' and the president is simply ridiculous and demonstrates a severe misunderstanding of economic reality.

Do you think Bush really cares about the economy especially after he will be out of office in two years?

Yes, he cares very much. If for no other reason than the crass political fact that if the U.S. economy is doing poorly in 2006 and/or 2008, the chances of a socialist Democrat like Senator Hillary Rodham (Clinton) being elected president becomes a real possibility, along with the Republicans losing their power in congress. Most people vote on their pocketbooks and if they feel - as you do - that the economy is doing poorly and they are being hurt, even if that is more apparent than real, a socialist Democrat using that perception to bash the Republicans while promising that they'll 'fix it' could fool enough people to be elected. It's happened before.

You're very optimistic. I'll grant you that much.

Thanks, but my optimism is based on the knowledge that gas prices are a focal point in any modern, industrialized economy and they cannot remain higher than can be justified without a lot of trouble for the gas companies and the politicians who are expected to 'fix it'. I'm sure some congressman or senator or two are already calling for hearings to 'investigate' the jump in gas prices. Half the political pundits are either blaming the gas companies for 'gouging' or blaming Bush...or both. That kind of national, laser-like attention on gas prices tends to have a limiting effect on how high they can go without any real, long-term justification that is both honest and believable.

I'm not freaking out about the gas prices. I'm just slowly learning how the goverment really works.

Really? It doesn't look that way from here. I would pay more attention to how the economy really works, if I were you. It will be of more benefit to your peace of mind.

[Unit 5302]

The jobs being created are low paying. More people work than ever before, taking jobs they don't want because they don't have a choice.

Arguing home sales as a legitimate benchmark of the economy's situation is pretty weak. The fact is interest rates were ridiculously low, resulting in the ability to afford a more expensive house with less income. This in turn created a huge inflation in house prices, and just like stocks in the late 90's, people have become obsessed with getting on board the real estate gravy train. The same low interest rates spurred a huge balloon in household debt as people have been relying more than ever on credit to buy the things they want, rather than the things they can truly afford. Many people took advantage of the low interest rates and refinanced, stripping the equity out of their houses to buy these "durable goods."

Foreclosures are up, and they will be increasing drastically in the next 2-3 years as people that purchased all they could afford and a little more will have to refinance their 3 year ARMs. This will result in a decline, yes decline, in housing prices across many metropolitan areas in the United States. As Greenspan has indicated, people are way too obsessed with the idea real estate will guarantee them a huge paycheck.

Debt consolodation has become big business, and credit card lobbiests have succeded in getting favorable legislation passed to remove the lender's responsibility to only lend appropriate amounts of money to people in this country.

All this in the face of a huge and continually growing budget deficit which hurts the value of the money people in this country are actually earning. The increase in per capita GDP over the past few years is largely attributable to the double digit increases in executive compensation.

CEO's now make 500x more than the base workers wage in the company. That's 10x more than any other nation in the world. With executive pay usually based on CEO payscales, it's a wonder average GDP is increasing.

Basically, the US economy IS screwed right now, but ridiculously low interest rates and tax breaks are artificially painting a pretty picture. Just like traditional value indicators in the stock market have been thrown to the wind, the traditional indicators for the economic status are void.

Bush has done a horrible job, and it's painfully obvious at this point. Only a fool would be so stubborn and arrogant to continue defending him. Even so, it's not like there were viable options to vote for in the last election anyway. It's six of one, and a half dozen of the other.

The republican party has become every bit as worthless as the democrats. Together, they have run this country, and the hopes and dreams of millions of American citizens straight into the ground, betraying the trust of the citizens at every turn. Whether it's the partisan bullshit keeping progress out of the capital or simply catering to each party's personal special interests, our representatives has become the most corrupt and sickening force in the world.

[82 GT]

Mr 5.0 , you're right, after readingUNITS last post, I do have a lack of understanding how the goverment works.
Having said that, his statement is more credible than what you're trying to say.
All the higher paying jobs are going to China and these "new jobs" being created are just like unit said...burger flippers, wal-mart, etc
If you look around and open your eyes, you will notice that more and more middle class Americans, including myself, are being forced to take second jobs in order to "stay ahead".
So, yes, the economy is in the shitter!
Just because YOU can afford $100/week in fuel doesn't mean the economy is "ok".
I admit I don't know everything about how the economy or goverment works but what is even more scary is the fact that you, and others like you, say "All is well"
I guarantee that you are not the type of person who comes home from work everyday with your hands dirty.
I don't have to be versed on how the economy works....all I need to do is live from day to day to know the economy sucks!
Open you eyes, get your head out of your ass and take a look around you and then say "All is doing well"
I bet you can't!

[Mr 5 0]

Originally Posted by 82 GT

Mr 5.0 , you're right, after reading UNITS last post, I do have a lack of understanding how the goverment works.

Well, I'm glad we cleared that up.

Having said that, his statement is more credible than what you're trying to say.

And here I thought you were doing so well, too.

All the higher paying jobs are going to China and these "new jobs" being created are just like unit said...burger flippers, wal-mart, etc. If you look around and open your eyes, you will notice that more and more middle class Americans, including myself, are being forced to take second jobs in order to "stay ahead".

About 2% of all U.S. jobs have gone overseas and few were 'higher paying'. Computer 'help' operators, factory and textile workers are hardly the upper crust of jobs.

My eyes are fully open and I see a lot of folks buying $40,000. SUV's, $3,000. plasma TV's and other indicators of affluence. That they work harder to pay for them is a tribute to materialism, misguided as that may be at times, it keeps the economy humming. If you are finding it necessary to take a second job, prehaps you should look at your expenses and also at your career prospects. You may be simply trying to live above your means or are not making enough to buy what you want without working a second job. Those are the results of personal decisions which we all make. Don't just blame 'the economy'.

So, yes, the economy is in the shitter!
Just because YOU can afford $100/week in fuel doesn't mean the economy is "ok".

I never said that I can 'afford $100./week in fuel'. I can't. However, just because gas prices went up drastically does not mean the entire U.S. economy is 'in the shitter', as you so charmingly put it.

I admit I don't know everything about how the economy or goverment works but what is even more scary is the fact that you, and others like you, say "All is well".

We all tend to be afraid of what we do not understand. It's O.K.

I guarantee that you are not the type of person who comes home from work everyday with your hands dirty. I don't have to be versed on how the economy works....all I need to do is live from day to day to know the economy sucks! Open you eyes, get your head out of your ass and take a look around you and then say "All is doing well". I bet you can't!

You know nothing at all about me so do not presume to make silly judgements here. It just undercuts your already thin credibility.

If you are not doing well, financially, of course the economy looks 'bad' - to you.

There is an old joke that goes like this: When your neighbor gets laid off the economy is in a recession. When you get laid off it's in a depression. In other words, our views of the state of the economy tend to be relative to our own position in it. I am not wealthy but I do grasp the fact that while our economy is far from perfect, it is also just as far from the disaster you and Unit 5302 claim.

I won't say that 'all' is well as that would be impossible. In a vast economy and a nation with almost 300 million people, there will always be areas of the country and people who are not doing well, at all. However, on balance, the U.S. economy is doing well, overall. I regret that you fail to see that and I despair of showing you otherwise as you are clearly wedded to your pessmistic view, as is Unit 5302. So be it. I tried - and I enjoyed the opportunity to explain a few things, even if they fell on deaf ears, or, more accurately, blind eyes. Whatever.

I wish you well.

[Unit 5302]

82GT, I am not insinuating the high paying jobs are leaving the US. They aren't. They're staying here, and they're paying more than ever. It's lower middle class to middle class jobs that are leaving. That being said, there are a lot of financial, technical and service jobs that are considered at-risk to move in the future.

It's true, you do know little about how the economy and government work. Mr 5 0 has legitimate points as he almost always does, and quite frankly, he's just plain right about some things. You're ill-equipped to argue micro or macro economics. I'm not insulting you, I'm just saying that it's probably not at the top of your list to learn about it so you haven't, and you just don't know too much about the inner workings of it all.

Mr 5 0, we both know the president has little control over the US economy. The majority if the economy is controlled through the Federal Reserve Bank, and the Federal Reserve Bank has controlled the inflation, and interest rates allowing people to borrow so much. Alan Greenspan pretty much controls the economy. Granted, the president can influence congress regarding federal government expenditures and tax revenues, he is hardly a main component of the economy. Workers today are earning less per hour, but they are working many more hours. The average middle class couple with children now works over 3,900hrs a year. That's 37.5hrs per week, each. Considering there are still about 46% of couples that only have one person income, the adjusted average worked hours would be 50hrs per week. People are working more to try and balance their budgets.

The durable goods you keep citing are being driven by the upper middle class and weathly who have the most expendable income, and of course, by ballooning debt ratios for consumers. People are spending themselves into giant holes they from which they cannot crawl out. The average household credit card debt alone has now increased to over $12,000. Add in interest only ARM mortgages and 60-72mo automotive loans and it paints a pretty ugly picture in regard to the average middle class family disposable income. Foreclosures are already nearing 1.25%, and bankruptcy filings have increased by a factor of 2 in the last 10 years. Bottom line is that the middle class don't have any disposable income to be making the purchases you're pointing to unless they're borrowing to against their future to aquire these goods.

While you can certainly point to the traditional market indicators such as home sales and durable goods purchases, I will point to the PE Ratio and how that traditional indicator has become far less useful in determining the market value of a security.

[82 GT]

Originally Posted by Mr 5 0

You know nothing at all about me so do not presume to make silly judgements here. It just undercuts your already thin credibility.

If you are not doing well, financially, of course the economy looks 'bad' - to you.

No, I don't know you but please tell us what you do do for a living. I'm sure it will explain your smug attitude.
Also, I never said I wasn't doing well. Where did that come from.....because I have two jobs????
My reasons for another job are not because of the economy. I was just saying that there are others who are forced to take second jobs because of the economy.
So, who's judging whom here? Yes, I'm complaining about fuel prices because I know darn well that they don't need to be that high.

[Mr 5 0]

Originally Posted by Unit 5302

The jobs being created are low paying. More people work than ever before, taking jobs they don't want because they don't have a choice.

Really, now? Then how do you account for the rise in household income and the increase in sales of durable goods as well as homes, being that all the new jobs are so lousy? You are free to cling to the myth that the millions of newly created jobs in America are all low-pay and dead-end but that position, while faithfully trumpeted by many, is simply not congruent with reality.

Arguing home sales as a legitimate benchmark of the economy's situation is pretty weak. The fact is interest rates were ridiculously low, resulting in the ability to afford a more expensive house with less income. This in turn created a huge inflation in house prices, and just like stocks in the late 90's, people have become obsessed with getting on board the real estate gravy train. The same low interest rates spurred a huge balloon in household debt as people have been relying more than ever on credit to buy the things they want, rather than the things they can truly afford. Many people took advantage of the low interest rates and refinanced, stripping the equity out of their houses to buy these "durable goods."

Granted, the low interest rates are a major factor and some new home buyers are overextended, but why are the interest rates so low to begin with? Are banks just being generous? Of course not.

The economy is sound and the yield on the 10-year Treasury Note is 4 times the Feds benchmark of 1%. People see a sound economy, the Bush tax cuts put more money in our collective pockets and, despite the protestations of you and others, jobs are paying well and people are feeling more secure with their jobs, considering the almost record-low unemployment rate. That, and the fact that everybody wants to own their own home, for obvious emotional as well as financial reasons.

Foreclosures are up, and they will be increasing drastically in the next 2-3 years as people that purchased all they could afford and a little more will have to refinance their 3 year ARMs. This will result in a decline, yes decline, in housing prices across many metropolitan areas in the United States. As Greenspan has indicated, people are way too obsessed with the idea real estate will guarantee them a huge paycheck.

All that may be valid, Kell, but your also assuming that a lot of people buy homes for resale and very few actually do that. Their homes market value may well decline but if you intend to live in your home for at least 5 or more years, that is not a major concern, as it is only a 'paper' loss, not a tangible one. Foreclosures may go up some, as you claim, but with so many new homeowners and the vast array of mortgages available, that is almost inevitable. It will balance out.

Debt consolodation has become big business, and credit card lobbiests have succeded in getting favorable legislation passed to remove the lender's responsibility to only lend appropriate amounts of money to people in this country.

True. However, 'appropriate' is a relative term when you are telling someone how much he/she can borrow. Credit card companies routinely write off about 7% of their 'bad debts' each year and include that calculation in their financial decisions that give us usurious 24% APR's for some folks with less than perfect credit, making up the card companies (actually, banks) losses on bad debts. Caveat emptor remains a truism that too many people do not know, much less, heed...to their financial sorrow.

All this in the face of a huge and continually growing budget deficit which hurts the value of the money people in this country are actually earning. The increase in per capita GDP over the past few years is largely attributable to the double digit increases in executive compensation.

CEO's now make 500x more than the base workers wage in the company. That's 10x more than any other nation in the world. With executive pay usually based on CEO payscales, it's a wonder average GDP is increasing.

Actually, the projected federal budget deficit is shrinking by about a third. Inflation is still quite low at near 3% and the executive compensation issue is a red herring. Increased productivity is the driver behind the increase in GDP. Executives at big corporations have always received huge comp packages because they are usually responsible for thousands of people and millions of dollars of company money, as well as the ultimate success of the company. That hardly compares to a worker who has about 1/500th or less of the same kind of responsibility.

Corporations that pay their executives tens of millions in compensation and do not perform well will eventually go out of business, in most cases. As almost all major corporations are owned by shareholders, which tend to be 'working people', the executive raises are no secret and are also subject to questioning and eventual approval - or disapproval - by a corporate board - that can also be voted out by disgruntled shareholders who feel their stock is underperforming due to executive or board mismanagement.

To claim that a few thousand people (corporate executives) getting big salaries and perks somehow raise the annual GDP is a bit farfetched, to be kind about it. The comparison of executive to worker pay is an old one that anti-business people like to use because the numbers look startling. However, the fact that a guy doing an average job today for less than 8 hours and making the average pay of around $40,000. per year and a corporate executive running a major company and putting in 60 or 70 hours a week with enormous pressures makes the comparison a poor one, albeit handy to use for shock value to the uninformed.

Basically, the US economy IS screwed right now, but ridiculously low interest rates and tax breaks are artificially painting a pretty picture. Just like traditional value indicators in the stock market have been thrown to the wind, the traditional indicators for the economic status are void.

Sorry, Kell, but I find that dire analysis to be almost totally false. I have already given a lot of reasons why so I won't bother to repeat them.

Bush has done a horrible job, and it's painfully obvious at this point. Only a fool would be so stubborn and arrogant to continue defending him. Even so, it's not like there were viable options to vote for in the last election anyway. It's six of one, and a half dozen of the other.

Careful who you call 'fool', Kell. Simply disputing your conclusions on the state of the economy does not render anyone in this world a 'fool'. It simply means that we see the U.S. economy differently. I see the many positive indicators and are pleased while you see it being, metaphorically, two days before October 28, 1929. That kind of pessimistic view, claiming that President Bush has done 'a horrible job' and ignoring the many safeguards and protections now built-in to our economic system as you spout economic gloom-and-doom is simply nott supportable. You are welcome to your negative outlook but disagreement with it does not make me anyone' s fool, Kell. Please get that straight.

As for President Bush, he has done an outstanding job of bringing us back from a recession not of his making (but for which the left constantly blamed him). The 2002 tax bill that lowered the tax rates was necessary and just in time. It is showing it's benefits now as the economy expands, investors invest and the federal budget deficit shrinks due to increased tax revenues coming in from the increased wealth being generated. That you wave all this away as a 'bubble' is your option but I think it is wholly mistaken.

The republican party has become every bit as worthless as the democrats. Together, they have run this country, and the hopes and dreams of millions of American citizens straight into the ground, betraying the trust of the citizens at every turn. Whether it's the partisan bullshit keeping progress out of the capital or simply catering to each party's personal special interests, our representatives has become the most corrupt and sickening force in the world.

While I don't share your all-too familiar bitterness, I can agree that our political system is bascially corrupted and does not generally help the average guy, much less the small businessman. However, we prosper anyway, thanks to the hard work and ingenuity of Americans, few of whom would consider their 'hopes and dreams were run into the ground', as you so dramatically state it. America is still the land of opportunity and success stories abound, every single day. That you seem to see only the negative and so, carry a cynical and pessmistic attitude into your conclusions of the U.S. and it's free market, capitalist economy is your choice and, as I see it, your loss.

Tens of millions of Americans would disagree with that assessment - and they would be right. Any economy is fragile - as we saw after 9/11 - and subject to many alterations and swings but ours is healthy and doing well. That you can't agree is fine...the economy will surge along with or without your approval, but your gloom-and-doom outlook is based on a lot of false asumptions and conclusions, in my opinion. However, that's why we have these boards...so people can express their opinions. I'll let others decided who's opinion they prefer but I'm very confident with my mine.