I have been listening to friends and family complain about gas prices. (myself included) The other night, a friend of mine said that if gas reaches $4.00 per gallon this summer, then he simply will not drive anymore. I am just wondering out of pure curiosity, how everyone will react? Do you plan on continuing your driving habbits the same as they are now? At what point, cost wise, will you draw the line? Is $4.00 per gallon the limit for you? Or are you willing to pay $5.00 per gallon to get where you need to go? How about $6.00 per gallon? I have a friend in the U.K and she tells me that gas is $9.40 PER GALLON over there...(yes, that is the conversion and it is correct) I wonder if they said the same things that we are saying now when gas reached $4.00 per gallon (U.S.) over there...(laughing) You have to realize though, that their prices include a myriad of taxes that enable them to have "free" (laughing) healthcare etc. So, I guess it balances out? You have to admit that we are rather spoiled here though. I see kids cruising the streets constantly...just burning gas...blaring their stereos...Which, by all means, is their right. Have at it... But we, as a nation, are somewhat spoiled...wasteful even. I was in Key west, Florida a few years ago and I remember nearly choking when I saw that gas was $2.05 a gallon! My wifes honda took $32 to fill up and I thought that was ridiculous. I noticed that all of the locals there didn't really drive though. They either walked or rode bicycles. Those that did drive, drove motorcycles and mopeds. (don't laugh, I saw some cool mopeds!) Anyway, it just goes to show you that they have adapted. I asked a local guy at the gas station how people afforded to buy gas there when they had to...he replied " Hey man, it's an island, where else you gonna go to get gas?" He had a point. I guess the bottom line is that we will pay ANY PRICE for a gallon of gas...no matter what they charge for it. We say we won't, but we will.
A couple of years ago when gas prices started spiking, I traded in my SUV (that I ADORED) on a tiny, fuel-efficient car. That's how I cope. It wasn't bad, after the initial adjustment. And whenever I start missing my SUV I remind myself that now I can fill up my tiny car for half as much and I can go twice as far - and I feel much better.
But we all know that whatever gas costs, we'll still drive our cars. More people may be forced (kicking and screaming) to carpool. More folks, like me, will pare down in size, even if it's not what they want to do. But what else can we do? It's not like our area is a thriving metropolis with subways and other mass transit to choose from. It's not like most of us can take the bus to work, even if we wanted to.
One thing I always laugh about though is when people say "Gas is so expensive I only get twenty dollars at a time!". What kind of skewed logic is THAT?! Like by buying less frequently they're somehow saving money. Or those who'll spend three bucks in gas driving all over Mobile to find a service station where they'll save two dollars when they fill up.
Nab,
Not many people have the self discipline to do what you did...I applaud you! Although I don't drive an SUV, I do own a truck...but it is an ABSOLUTE NECESSITY for my job...so I have no choice. I too laugh when I hear people say that they drove all the way out to such and such gas station because it was .19 cents cheaper! (Laughing) I guess that $3.00 they burned made it worth saving $1.00? My father used to say "You will go broke trying to save money"... Now I know what he meant. Bob, I agree with you, it is getting ridiculous. I guess my question was at what point will gas prices affect your income to the degree that it is costing you to drive to work? For instance, I used to work in Foley but I lived here in Mobile. When I first started, gas was costing me about $60 a week. (I drove a honda civic) As time progressed, gas went up. I recieved annual pay increases, but they couldn't keep up with the price of gas to balance the effect. So, after a few years, I was paying nearly $100 a week in gas. Thats $400 a month! It would have been cheaper to rent a place down there and come home on the weekends! So, of course, I had to find another job here in Mobile. I'm not being nosey here, but at what gas price will you have to throw in the towel because it will simply be COSTING you to go to work? Thats why I asked about the $5 and $6 per gallon scenarios. I have been doing some figuring, and for me, if gas reaches over $5.75 per gallon, I will have to significantly increase the cost that I charge my clients. Between here and there though, I will only have to increase my rates slightly. Either that or I am just gonna move to Key West and ride a bike!
I'm not being nosey here, but at what gas price will you have to throw in the towel because it will simply be COSTING you to go to work?
Obviously a lot depends on what one does for a living. If you work at a job where you can pass on expenses you have to pay, such as gas, to clients or customers, you're better off than those of us who work for a straight salary where there's nothing we can do. And you're right, cost of living raises seldom keep up with the cost of living. In the past year between property tax increases and insurance costs skyrocketing, my menial little raise won't put a dent in the extra cash outlay.
And that's where we have to be creative. Though there's nothing I can do about the property tax escalation - and I wonder just what happened to my request for re-appraisal anyway? - I reduced my insurance costs by decreasing my coverage and increasing my deductible. Downsizing my car not only saved money on gas but insurance costs as well...plus I raised my deductible there, too.
I quit eating out during the week, and started bringing lunch to work. The point is, there are some things we have to pay, no matter the cost, and gas to get back and forth to work is one of them. Once you get those costs down as low as you can, then you have to look at other areas where you CAN save money.
And there's always a second job...though I'll probably shed LOTS of my worldly pleasures before that happens.
I too have a problem with the rising gas prices, its ridicolus. I personally bought a motorcycle, that helped some. but i now want to pose a thought to you guys, awhile back i saw a headline on one of our papers stating that one of the major gas companies made around 15 billion dollars profit, in a quarter, now that your hot, here is the thought, have you noticed that the federal goverment is going after lending officals for making big profits while company was going under, well why is it that the oil companies are not being investigated, how much of a price per gallon of gas is taxes and if those taxes are to keep roads repaired, why do i hit loose dirt and gravel on my bike and worry about it shooting out from under me, I have always been a surporter of the war on terrosim, and keeping the battle afar, but i am tired of paying for it while the rich get richer. people that only make minimum wage cant live, middle income is struggling, but their is no relief in sight.
Suggestion: if everyone in the United States would for one day decide as a nation we will not buy gas, we would get someones attention.
one more pet peave i have is when going to a business owned by a foreinger and have to pay taxes knowing they are tax exempt for so many years and when their time is up they can sell it to a spouse, child and so on, never putting anything back into the economy. what ever President allowed this bill to be passed is and idiot.
Gas and oil companies making huge profits while average people struggle...insurance companies reaping enormous profits while cancelling policies or increasing premiums on the very people who made them rich...big tobacco companies, producing a product that is a proven killer, rolling in money while ignoring the deaths of their customers. And our government allows it all to happen.
Your idea about not buying gas for a day has been going around via e-mail for several years now. It won't make any difference. We don't buy gas tomorrow, but then the day after there are twice as many sales. We can NOT win.
Now, about a business owned by a non-American, I'm not sure I understand this. Are you saying such an owner doesn't pay taxes though we are taxed on our purchases made? That can't be right. Explain this more please.
Downtown4u2,
You are right...with the prices we pay for gas, our roads should be FLAWLESS. But of course, they are not. There are too many execs getting filthy rich from the gasoline cash cow. I would venture to say that even on a local level, there are some who are dipping their toes. The problem with the "don't buy gas for a day" plan is just like Nab said...the following day, people buy twice as much. It is a no win because we, as a nation, are spoiled. Then, you have those that make so much money (good for them?) that they simply buy as much as they want, when they want, so that their Hummer 's tummy won't growl. Most Americans (notice, I said MOST meaning NOT ALL) have the "BIC" attitude. (B)ecause (I) (C)an. Read through dozens of these posts, and in almost any two sided debate, you will see people with this attitude. (i.e. saggy pants, not tipping in restaurants etc.) We live in a wonderful country chock full of freedoms! But I often wonder, are we so free that it makes us prisoners? Nab, you mentioned big corporates making record profits off of their customers. Insurance, in my opinion, seems to have become a legal racket. It's just a legal way for them to extort money from you. The law REQUIRES you to have insurance...that is a fact, but the law offers no regulation as to what prices they charge or their practices or policies. So, when you actually need your insurance coverage, as a customer, you're out of luck! But hey, if you miss a payment...well, you better hang on to your wallet because now there will be fees and rate increases to follow! And if a natural disaster hits, well, you're out of luck! Why? Well, because your insurance doesn't cover "THAT"...type of tree...or that type of "wind" or "water" damage. If you do make a claim, well hey, now we have to increase your rates.
Cigarette companies will ALWAYS make huge profits because there are too many people addicted to them. And, just so you know, those companies don't lose ANY sleep over the deaths their products cause...after all, it's a free country...they don't have to smoke. But look at the revenue on not only on a global scale, but on a local scale that tobacco generates. Which do you think is more valuable to them...human life...or money? Imagine if they decided to start charging outrageous fees for water. I am so thankful that they have not decided to use water for fuel in our vehicles...at the rate that we consume, our water supply and oceans would be GONE in a matter of years. But hey, they could make SO MUCH money while it lasts. And our roads would still have pot holes. (laughing) As for the tax free businesses, I have heard of that. I think there is an exempt status provision for immigrants that meet certain criteria but it is only for the first three years that an immigrant opens a business. (I think) There are Federal funding assistance programs available that provide money to immigrants under special exemptions for the sole purpose of opening their own business. (think about all of the Chinese and Mexican Restaurants...great food by the way) But sadly, you and I are not eligible for these exempt loans because we were born here. We do, however, pay for these freedoms for other people with our taxes. Anybody wanna go to lunch?
Yall think that your gas prices are high? Try owning a class-8 truck. ( Semi) Own one of those,6-7 mpg. $600.00-$700.00 to fill it up.Do that 3-4 times a week. Also do not just say that it is an operating expense, it is really biting into the bottomline that is not that big. I gave up my truck 2.5 years ago. When I fuel up my companies truck it just makes me sick. If you think that the money keeps pace think again. Most of hese current Owner-Operators are makin abut a $1.00 a mile. Yes there is a ful surcharge, but do you think it covers it? No it does not. BY THE WAY IT TAKES ABOUT A MILE JUST TO GET UP TO SPEED, WOULD YOU PLEASE NOT CUT ME OFF. I PULL A TANKER, TRY HAVING A 5 TON SURGE HIT YOU. If you wonder what it feels like,sit in a chair and have someone kick the ack ay your lower back area.
Generally speaking, there are three reasons why the price of anything rises.
1. An increase in demand
2. A decrease in supply
3. Inflation
Right now, all three factors are working to make gas prices rise.
The demand for oil, we know, was going to rise anyway because emerging economies like China and India are increasing their oil use.
This is exacerbated by the War on Terrorism. The US military alone is spending hundreds of millions on oil daily to carry on the occupation of Iraq and Afghanistan. This is aside from the oil consumed as a part of the regular activities the military conducts stateside, and the oil consumed by other countries like England for their activities in Iraq and Afghanistan.
At the same time, the supply of oil has fallen, or at least has not risen to meet increased demand. Production of oil in Iraq has stagnated and is far below levels before the invasion. Meanwhile, the situation in Iraq and the hints at a possible attack on Iran create uncertainty. Oil producers are reluctant to invest in building new facilities and increased exploration in an area where their investments might become war casualties. OPEC’s curtailments of production add to the problem, as well as strained relations with Venezuela.
But probably the biggest reason for the spike in oil prices is inflation. The Federal Reserve is desperately trying to stave off recession by churning out money. The recession was triggered by the burst in the housing bubble, which itself was caused by the Fed’s loose money policy. So the Fed is trying to put out a fire by throwing gasoline on it.
As the Fed creates more money, it makes every dollar in your wallet a little less valuable. In reaction to this reality, the price of everything goes up. The price of oil particularly goes up because oil is tied to the production of almost every good and service.
Also--and most people aren’t aware of this--the dollar is tied to an unofficial “oil standard.” Oil on the world market is priced in terms of dollars. This is because the dollar has traditionally been the reserve currency of the world, because the US economy has traditionally been the most stable and productive. This has been good for the US economy because the exchange of dollars in the world markets means a guarantee of demand for US goods (a dollar is worthless unless you can buy something with it.)
But as the value of the dollar plummets, world markets are less enthusiastic about taking dollars. Countries like Iran have earned the enmity of the US by supporting a switch to a Euro standard. But if the dollar continues to decline, eventually there won’t be any question of it.
