Largest drop in driving ever recorded

[Burns]

Originally Posted by Rick

Really the overall economy isn't too bad. Only those who were stupid, and got into a bad loan, or those who flip houses are affected

I agree with you here Rick. Gas sucks but other than that its all good. I dont have a huge payment on the loan i have and i dont have a new car (LIKE EVERYONE ELSE).

[glfredrick]

Originally Posted by explorer#2

WOW...what did you just say???

Rick is making a stupid comment, likely aimed at me...

Travel and luxury are always the first things to go away when money gets tight. The expansion of both in the last few years was not indicative of a good economy, it was indicative of an economy where people were spending their kid's inheritance on themselves. It was an aberration in the big scheme of things -- as is house flipping (at the rate we've seen in the past 5 or so years), borrowing to invest in the market (shades of 1929 ), and a few other practices (like $5 a cup coffee).

Back to the thread...

Wonder how much the government is going to raise the fuel tax now that no one is paying in to it via the gas pumps? Also wonder how many more roads will go to pot, and how many more bridges will be falling with no revenues to fix them. All that ought to stimulate more fuel use and lower prices...

[Rick]

I think what Guy would really like to see is a nation where everyone is stuck in their home town with no ability to travel. I guess travel is a luxury and luxuries are a sin?

Maybe we should all travel on asses? Only problem with that, is given our population we would be traveling through streets which would quickly turn to rivers of ass poop.

[Rick]

And another...

Delta joins Northwest in flight cuts - CNN.com

NEW YORK (CNN) -- A day after Northwest Airlines announced it was scaling back domestic flights, Delta Air Lines did the same Wednesday -- announcing a 3 percent cut for the second half of 2008.

Delta's decrease comes on top of a 10 percent reduction in capacity announced by the airline in March. But rising fuel costs made additional cuts necessary, the Atlanta-based company said Wednesday.

Delta estimates that fuel could cost $4 billion more in 2008 than in 2007. The airline has implemented fare increases, a hedging program that allows the company to get contracts on oil prices below the market rate, and offered early-retirement incentives to employees to help cover the higher than expected fuel cost, according to a Delta spokesperson.

[explorer#2]

Originally Posted by glfredrick

Travel and luxury are always the first things to go away when money gets tight. The expansion of both in the last few years was not indicative of a good economy, it was indicative of an economy where people were spending their kid's inheritance on themselves. It was an aberration in the big scheme of things -- as is house flipping (at the rate we've seen in the past 5 or so years), borrowing to invest in the market (shades of 1929 ), and a few other practices (like $5 a cup coffee).

Im an economics major so I know all about that.

[Rick]

Except during the Civil War, Great Depression and World Wars, when in our nations history did our country as a whole have to make a massive re-adjustment which made them less well off?

In my opinion by stopping the masses from being able to travel cheaply, we have become much worse off as a nation than at any time in my 46 years here on the planet.

Outline of the U.S. Economy
Periodic economic dislocations did not curtail rapid U.S. economic growth during the 19th century. New inventions and capital investment led to the creation of new industries and economic growth. As transportation improved, new markets continuously opened. The steamboat made river traffic faster and cheaper, but development of railroads had an even greater effect, opening up vast stretches of new territory for development. Like canals and roads, railroads received large amounts of government assistance in their early building years in the form of land grants. But unlike other forms of transportation, railroads also attracted a good deal of domestic and European private investment.

The article above is from what I would call a comprehensive summary of our nations economy since it's founding. Interesting reading. Our government has been doing what GLF hates almost from the beginning, not just since the "New Deal". They helped farmers, railroads, and other interests on a regular basis to keep our economy moving.

[glfredrick]

Originally Posted by Rick

Except during the Civil War, Great Depression and World Wars, when in our nations history did our country as a whole have to make a massive re-adjustment which made them less well off?

In my opinion by stopping the masses from being able to travel cheaply, we have become much worse off as a nation than at any time in my 46 years here on the planet.

First, notice that all the major adjustments came during times of war (except the Depression, which was in a sense a recovery from war time earlier).

Second, notice that we are actually at war right now -- even though a lot of folks, Rick included, ignore the fact that we are at war.

Third, evidently these periodic adjustments are a part of the free-world economy, and evidently also, the nation rebounds after.

Fourth, no one is "stopping" anyone from traveling. They are stopping themselves. What we are seeing is a free market correction for the cost of fuel.

With that thought in mind, what do you think is going to happen eventually to the cost of fuel? Once all those "evil money grubbing" corporations start loosing money hand over fist, what are they going to do about it? I'd suggest that they will figure out how to cut costs to stimulate their part of the economic picture -- or they will go away like other businesses have in the past. The typewriter business comes to mind...

I also know now why you are so upset about all this... You're just enough younger than me to not have actually paid your way through the other fuel cost adjustments that we've made in the past 40 years. This too will pass and life will go on. Every time it is doom and gloom.

Now, to find me a nice V10 truck for a tow rig -- cheap...

[shamaal]

Anyhow

So if I understand this correctly, US demand has dropped, the supply has risen slightly and the cost is skyrocketting. Perhaps there is something to oil prices being driven by speculators.

[Rick]

Second, notice that we are actually at war right now -- even though a lot of folks, Rick included, ignore the fact that we are at war.

Did the economy tank during Korea, Vietnam or Gulf Wars? The economy tanked during the big wars because our nations economy switched to a war time economy... Automobiles were not built during WWII because they were building tanks and planes on those lines. The majority of able bodied men were out fighting, instead of producing and consuming. The civil war, the nation was fighting itself and was torn in two. Of course the economy will be bad.

During today's war we are still building H2 Hummers for gang bangers, Cadillacs and anything else you want. People have not had to make sacrifices, except those who are there, or those who have family and friends who are.

Big difference...

Our economy did not tank because of the war, it didn't help, but it was not the cause.

This "adjustment" we are going though seems more in line with the Great Depression than a "free market correction".

No one is stopping people from traveling. That's rich... You're right. No one person is stopping anyone, it's this little thing called money. Without it, we don't travel. When you are no longer earning enough to put fuel in your tank you don't travel. When airlines raise their prices, you don't travel.

I've been driving since 1978 Guy. 1980 was supposed to be the worst year for fuel prices "adjusted" until today. 1980 was also the year I graduated HS.

At that time, I was driving my Dodge Dart which ran 11s and got 9MPG. I also owned a '74 Ford F250 which I used to trailer my Dart to the track. I do not remember feeling any where near as pinched as I do today, when I plunk down about $150 to fill the tank in my Dodge.

Back in '80 minimum wage was $3.10 an hour and I believe fuel hit $1 a gallon for the first time. Today the minimum wage is $5.85 and fuel costs $4+.

Which economy do you think was better for the little guy?

[glfredrick]

Originally Posted by shamaal

Anyhow

So if I understand this correctly, US demand has dropped, the supply has risen slightly and the cost is skyrocketting. Perhaps there is something to oil prices being driven by speculators.

Some sense posted by shamaal...

[Rick]

Saudis get serious on oil prices - Jun. 19, 2008

The Kingdom is expected to press the U.S. government to impose greater controls on oil trading and take steps to strengthen the dollar.

The world's largest oil producer, stepping out of its usual role as de facto leader of OPEC, will host representatives of big oil producing nations, consumer countries and companies.

The Saudis are widely believed to be concerned that escalating oil prices - crude hovered around $134 a barrel Thursday, nearly double what it cost a year ago - will cause a permanent drop in demand as consumers get more efficient or, worse, the global economy slows.

One sign of the Saudi anxiety: The country's oil production decisions, usually left to its oil minister, appear to have been put back in the hands the Royal Family, according to Antoine Halff, deputy head of research at brokerage firm Newedge.

Bush visits SA. SA says, they aren't going to pull more oil. A week or two later, they come back and say they will. Once again the decision is in the hands of the Bush's best bud.

[glfredrick]

You've been bitching for Bush to do something to lower gas prices -- now, he's doing something and you're bitching...

You gotta stop being a hater... Bad for your health.

[shamaal]

Rig count is down by 12 this month. Part of the increase in profits are the companies aren't investing in equipment and looking that hard. With oil at $140 bbl and the most costly extraction (shale) running at $28/bbl there isn't that much reason to seek new locations, unless they are cheaper and increase the profit margin.

18 new offshore rigs will come on line this year and all rigs are booked for the next 5 years.

HOUSTON (AP) -- The number of rigs actively exploring for oil and natural gas in the United States fell by 12 this week to 1,877.
Of the rigs running nationwide, 1,479 were exploring for natural gas and 390 for oil, Houston-based Baker Hughes Inc. reported Friday. Eight were listed as miscellaneous.

A year ago, the rig count stood at 1,774.

Of the major oil- and gas-producing states, Texas lost 14 rigs, Colorado lost nine, New Mexico lost two and California and Alaska each lost one. Louisiana added three rigs, Oklahoma added one and Wyoming was unchanged.

Baker Hughes has tracked rig counts since 1944. The tally peaked at 4,530 in 1981, during the height of the oil boom. The industry posted several record lows in 1999, bottoming out at 488.

US oil and gas rig count down 12: Financial News - Yahoo! Finance

[Rick]

I've also been bitching about collusion which benefits Bush and Co...

Originally Posted by glfredrick

You've been bitching for Bush to do something to lower gas prices -- now, he's doing something and you're bitching...

[glfredrick]

You'll have to prove that the collusion 1) exists, and 2) that it has made Bush wealthy in some way that is illegal.

Otherwise, you are just another conspiracy theorist -- and a poor one at that...

What is in fact happening is that the free market is starting to take effect and prices will likely drop. They are not being driven by demand, by the OPEC nations, or by overconsumption. They are in fact being driven by speculation... Ever hear of the Gold Rush? Or how stupid beer cans once gained value because everyone and his brother were collecting them? Eventually, the bubble pops and prices return to sanity. (seems like some homes are going through this cycle right now also... )

One other thought comes to mind... What are you going to say once Bush is no longer president and the prices are still where they are? FOR SURE Obama will not lower them. He hasn't a clue... If anything, he will cause them to raise another dollar a gallon or so, almost immediately, for the SPECULATION that is driving the industry will only increase along the lines of the threats that he has made to "punish" big oil with confiscatory taxes. That will surely help...