The Economy

[NevadaJay]

beerman - educate me please ( I'm not up to surfing to find the answers right now). Where are these locations of all of these reserves? Are they located on US soil?

[beermantm]

Article

The national security of the United States of America is tied first and foremost to our energy requirements. These requirements MUST be independent of all foreign entanglements, they must be purely American. There is no legitimate reason why Americans should be paying $3.00 to $3.50 at the pump for regular gasoline while Corporate Oil giants are reaping billions of dollars in pure profits. This simply should not be. It is tantamount to an economic rape of the American consumer and our role in the national economy.

Texas, Oklahoma, Louisiana, the Gulf of Mexico are states which produce a small fraction of our total oil production capability. American reliance on foreign oil imports would end very quickly if our government determined it truly wanted to become energy independent - if YOU really wanted the U.S. to be energy independent. Let's check some quick facts, and then you sound off on how you think we can get the government to do what's best for America.
There are huge reserves in ANWR, according to the U.S. Department of the Interior there are more than 10 billion barrels that could be recovered for consumption and placement into the national strategic reserve. ANWR was set aside for this purpose by a Carter-era Democrat-controlled Congress, but we have yet to seriously tap into the ANWR reserves.
Then there are the American oil shale (kerogen) reserves, on the order of 2,500 gigabarrels, which is the largest known reserve of its kind in the world, enough to power the economy well into the 22nd Century.

[Daws1089]

:thumbs: I am retired, and every time I go out, I run into "rush hour" type traffic. I am referring to late morning early afternoon times. Wtf I ask myself? Dont these people work? Are they retired too? Are they the people bitching about the fuel prices? **** that, get out of the SUV, get a hybrid, ride the bus, or plan ahead and get your goods for the week.
Everytime you fire that vehicle up, it burns fuel.
Stop making those useless trips for bread, milk, or whatever, stock up! Same goes when you buy gas, Fill it up!!! The more unecessary trips you make, the more fuel you will use!
Drive less, the price increase wont affect you, so you can stop Bitching! :drunk:

i'm the same way and couldn't agree more HD

[beermantm]

why delete my post? Just disagree if you like but to flat out delete is bull****!

[Skinsfan]

Very good points, skins, fish.

Re: the mortgage mess. I for one am about personal responsibility and accountability. Those folks who had no business getting themselves into an ARM that was set to adjust and either didn't care or didn't bother to actually understand what they were signing are now having to pay the consequences. That's just a fact and they'll have to deal with it.

Thanks to all of these people, the middle class looking to buy a single family home are priced out of the market. I actually hope the market corrects another 30% or so downward. The run up was ridiculous.

I'm flabbergasted that more folks don't stand up and say that - all we hear now is how the government is going to step in and bail these people out. Why? Because they were either greedy (buy and flip mentality) or asleep at the wheel for not understanding what they were doing? I think that's garbage, and leave my taxes out of a bailout, please.

Life is all about choices....and then dealing with the consequences of those choices.

Not sure if i can agree with this.... most of the people that bought more than they could afford were doing so because it was basically a once in a lifetime opportunity.... not to mention that every media outlet was telling them that prices were going to go up FOREVER! You can hardly blame people for listening to the hysteria (it's human nature to do so... financial bubbles have existed for hundreds of years... no one blamed investors for buying at the top of the tech bubble in 2000).

Instead, we should point the finger at the banks and other institutions that encouraged such recklessness. What about the CDS and these other financial instruments designed to float risk around and provide more liquidity?

As for a gov't bailout.... it is good for everyone, as weird as it seems.... it will stabilize prizes, stabilize interest rates, and prevent entire neighborhoods from being run down due to neglect.

[homedawg]

In my opinion, we need $10 gas.

:thumbs: I am retired, and every time I go out, I run into "rush hour" type traffic. I am referring to late morning early afternoon times. Wtf I ask myself? Dont these people work? Are they retired too? Are they the people bitching about the fuel prices? **** that, get out of the SUV, get a hybrid, ride the bus, or plan ahead and get your goods for the week.
Everytime you fire that vehicle up, it burns fuel.
Stop making those useless trips for bread, milk, or whatever, stock up! Same goes when you buy gas, Fill it up!!! The more unecessary trips you make, the more fuel you will use!
Drive less, the price increase wont affect you, so you can stop Bitching! :drunk:

[NevadaJay]

Very good points, skins, fish.

Re: the mortgage mess. I for one am about personal responsibility and accountability. Those folks who had no business getting themselves into an ARM that was set to adjust and either didn't care or didn't bother to actually understand what they were signing are now having to pay the consequences. That's just a fact and they'll have to deal with it.

Thanks to all of these people, the middle class looking to buy a single family home are priced out of the market. I actually hope the market corrects another 30% or so downward. The run up was ridiculous.

I'm flabbergasted that more folks don't stand up and say that - all we hear now is how the government is going to step in and bail these people out. Why? Because they were either greedy (buy and flip mentality) or asleep at the wheel for not understanding what they were doing? I think that's garbage, and leave my taxes out of a bailout, please.

Life is all about choices....and then dealing with the consequences of those choices.

[Fish2006]

some good points, especially re: healthcare and ethanol.... but my question "what can the gov't do" was directed towards Rothko's point of high gas prices...

This is not Russia or Venezuala... the state doesn't own the oil companies, and they can not directly force them to drill for more oil. Even if they did, the increase in supply would be marginal and ineffective in changing the price of oil for any meaningful length of time, imho.

One of my favorite things about predictem is how the debate here seems to be vastly more intelligent than on places like slate.com where supposed "political" people hang out.

Its true though. You don't add 1 billion Indians and Chinese suddenly driving to the world oil market and expect the price of oil, and therefore gas, to not triple. If you want to see why your gas is expensive, Google for "china and construction".

Last year I spent 2 weeks in India, and the most striking thing wasn't the cows on the road, or a family of seven plus the family goat riding on a single motor scooter, or even the smell of rancid curry and garbage everywhere, but it was the utter pace of construction of new skyscrapers, freeways, malls, and everything else that goes along with suburban life going up there. It is really breathtaking.

We need to find a way to power things like cars on something other than decaying dinosaurs.... I mean oil. Higher prices for oil get us there, because the alternatives go from comparatively price prohibitive to viable. $4 gas gets you hybrid cars, Chevy Volt, the Telsa, and other new cars coming to the market that use less of it. I think $10 gas gets you a viable hydrogen infrastructure.

One of the funny things about politics is "be careful what you wish for". It is interesting how "pro-environmentalism" (i.e. desire to use less gas) - comes at the price of increased poverty for people who can't afford gas. What sucks is that if you are struggling, you are the people least able to adjust to the new reality and least able to pay for it. Don't know the answer to that one, but I dare say that whether you like it or not, thats the new reality.

That all said, gas isn't why we are in a recession. Bear Stearns borrowing money at 100-1 leverage from China and issuing mortgages (through brokers) to homeless people, flippers, and people 2 months out of bankruptcy with 100% loan to value at 6 percent is why we suddenly have chaos in the financial system.

Lets put it in these terms, for someone that drives a lot, $5 gas means you might pay $500 per month rather than $200 at $2 dollar gas. That is a $300 hit, but compare that to what happens when someone who is in a subprime mortgage for a $500k house has a rate adjustment after a 3 year fixed period from 5% to 10%. Thousands more mortgage hitting at once. That is basically the equivalent of suddenly having $18/gallon gas.

THAT, is why there is a slowdown. And it will take some time to adjust through the crappy mortgages to recover from it.

[homedawg]

And let's stop strangling small business (you f'ing can't smoke in a bar or restaurant any more - let's let the CONSUMER decide...if they don't want smoke, they won't show up...period.). And I'm not a smoker...

:beerbang:
Haven't spent a cent in a bar or restaurant in a year!

[Skinsfan]

some good points, especially re: healthcare and ethanol.... but my question "what can the gov't do" was directed towards Rothko's point of high gas prices...

This is not Russia or Venezuala... the state doesn't own the oil companies, and they can not directly force them to drill for more oil. Even if they did, the increase in supply would be marginal and ineffective in changing the price of oil for any meaningful length of time, imho.

[NevadaJay]

What can the gov't do?

Well, for starters, they could start drilling for oil in places they know it exists IN THIS COUNTRY.

And let's stop feeding and providing healthcare for illegal immigrants.

And while we're at it, let's expose this whole ethanol thing (it's more of a crush on resources than just producing gas for christ' sake).

And let's stop strangling small business (you f'ing can't smoke in a bar or restaurant any more - let's let the CONSUMER decide...if they don't want smoke, they won't show up...period.). And I'm not a smoker.

That's a pretty good start in my opinion...

[Skinsfan]

Roth, a couple of points....

1) the run-up in oil really began about 5 years ago....

2) no one is blaming the people... it is just a fact of life... supply/demand

3) $4 gas is not terribly expensive when you compare it to other developed nations

4) what can the govt do? This is not a USA issue.... if anything the US government should have taxed the heck out of it 5 years ago so that our pump expenses would stay in house instead of exported to the middle east


The "crunch" you are experiencing is not because of gas..... people are still buying it, so it is obviously not priced too high... the crunch is from this country living well beyond its means for the past 25 years.... just take a look at the current account deficit.... Now that credit has dried up, people are less able to mortgage their futures to buy crap today.

In my opinion, we need $10 gas. I live in Northern virginia, which last time i check was ranked as the second worst traffic are in the country (behind LA). And it is STILL growing like crazy.... yet the HOV lanes are still relatively empty, and i swear half the vehicles on the road are SUVs.... people are not changing their habits... they aren't carpooling or taking public transportation.... Until we as a country start changing our oil consumption habits, nothing is going to change. There is minimal incentive to research and develop alternative energy sources in a reasonably quick fashion when people are not being economically displaced.

[Rothko]

yes you are naive

what we really need is much higher gas prices to force people and the government to change their habits.... lower gas will just encourage more spending on oil, which will bring the prices back up, and we'll be caught in a cycle (only no one will change their habits and change will be delayed).

in other words, it would only be a quick fix

the real problem is not us, but the indrustrialization of China... they're deman for natural resources is skyrocketing

I see your point Skins but why all of a sudden now this crunch on oil? Is 2008 the inevitable brick wall some have predicted because of our dependancy on oil? Are we really at the end of line where gas is going to be $4 and the blame is squarely on the shoulders of the people!? Why couldn't it have been regulated years ago so something like this could never happen? It's hard to put all the blame on the people without thinking the govt dropped the ball from the beginning!

[Skinsfan]

Am I naive in thinking that lowering the gas prices would eliminate this consumer fear? It's seems like everyone's just buying gas and milk! Can someone explain why we are paying this much for gas? I'm not trying to start some heated debate...but who the **** is to blame over this ass rape? It's just frustrating that there seems to be no relief in sight!

yes you are naive

what we really need is much higher gas prices to force people and the government to change their habits.... lower gas will just encourage more spending on oil, which will bring the prices back up, and we'll be caught in a cycle (only no one will change their habits and change will be delayed).

in other words, it would only be a quick fix

the real problem is not us, but the indrustrialization of China... they're deman for natural resources is skyrocketing

[Rothko]

Unfortunately I think it's going to continue to be horrible until Christmas.

Lots of BIG companies are in trouble as well.

Real estate is going to dive this year even more too or at least thats the way its looking.

Amen brother! My best freiend is in developing and he's starving right now! Why lower interests rates when we can't afford transportation to our jobs!

Oh and thanks for the sweet av Kevin! :thumbs: