Another Reason for High Gas Prices?

[jreeves]

True enough, I suppose.

Please explain to us how the price of oil can double in a year when there is no shortage in supply or equivalent increase in demand.

Feel fee to consider the effect of specuators and taxes, which you apparently understand better than I do, and explain their impact on prices.

Seriously, I don't get it and truly am seeking anyone with a superior understanding of this market to help me get it.

Taxes make up a small part of the price of gas. Yes, like Paulitics said the crappy dollar is driving up the price of oil. Since oil is priced in US dollars.

 

[jreeves]

Not just the budget deficit, but the trade deficit as well. We've been exporting our inflation to other countries which has delayed the effects here at home, but eventually those massive amounts of Dollars are going to make their way back here when those countries no longer benefit from holding them. I believe high oil prices have been an effect of this. Basically the high prices we're seeing all around us in general are an effect. And it looks like the Fed is willing to paper away the debt as it continues to be racked up, so don't expect things to get better anytime soon.

It's either stagflation for a long while, or they cut our throats and raise rates again to boost the Dollar. If that happens this time around, all hell will break loose. This nation can not survive another deflationary recession/depression this time around. We're not nearly productive enough anymore.

Ouch.....53 trillion dollars of total debt...

 

[Jeepers]

On this I could not agree more. I have been saying time and time again. The answer to nearly all our problems is first to balance the budget and then to begin paying down the debt. The Deficit is the root cause of he low dollar value, and high gas prices.

You advocating the imediate withdrawl from Iraq?

 

[jreeves]

You advocating the imediate withdrawl from Iraq?

I agree that the military budget could be cut. For one, you could cut out all of the waste that is there. Secondly, do we really need troops in just about every nation on the planet earth? With that being said, we should not leave Iraq, until our commanders on the ground have given the ok. To leave Iraq before it is completely stable would be incredibly stupid. Back to balancing the budget, look at this chart and you tell me where we have the best opportunity to make cuts due to the size of money spent?

 

[Chris]

I agree that the military budget could be cut. For one, you could cut out all of the waste that is there. Secondly, do we really need troops in just about every nation on the planet earth? With that being said, we should not leave Iraq, until our commanders on the ground have given the ok. To leave Iraq before it is completely stable would be incredibly stupid. Back to balancing the budget, look at this chart and you tell me where we have the best opportunity to make cuts due to the size of money spent?


View attachment 5685

Iraq stable? It ain't going to happen. Let the Shia and the Sunni kill each other and let Allah sort them out.

 

[editec]

Interesting chart.

Please further define " All social spending" so we have some idea of what on erth we're REALLY looking at.

 

[indago]

Charles_Main wrote:
----------------------------------------------------------------------------
I have been saying time and time again. The answer to nearly all our problems is first to balance the budget and then to begin paying down the debt. The Deficit is the root cause of he low dollar value, and high gas prices.
----------------------------------------------------------------------------

But this doesn't solve the problem of the rampant debt creation in the first place.


-

 

[Paulie]

View attachment 5684

Ouch.....53 trillion dollars of total debt...

Yeah dude, and how do you possibly expect the government to make good on that debt? The only way is raise taxes tremendously, or inflate their way out of it. But that's a lot of inflation.

In the 30's, the government basically declared bankruptcy when they moved away from the strict gold standard, because they ran out of gold to back the currency. So they started to jack with the exchange, and print extra paper that was not convertible to gold. We've been bankrupt before, and there's no reason to think we can't be again. This time around, they have nothing to fall back on. All they can do is inflate the debt away, and then deflate the currency back to worthwhile value again. Hence, the boom and bust business cycles we've seen many times before. Those business cycles are another way of transfering wealth from the poor to the rich.

This is why when you say we won't see a depression, I challenge you. How much more debt do you really think this country's economy can handle, with a fiat currency that is being treated the way it is? There's no way we can pay that debt down without massively inflating the currency. The only problem is, we've sent so much paper to other countries and placed the majority of the inflation burden on them, that it's starting to catch back up with us. Eventually, those countries are going to want to dump those Dollars as they are going to become more of a liability than anything else.

We can't just bury our heads in the sand and pretend that because we are America in a "global economy", that there aren't going to be repercussions for the way we have treated the rest of the international community economically. Sooner or later, we're going to have to assume that inflation, and it looks like we're starting to see it.

This is why I think so many investors are running to commodities the way they are, specifically oil and gold. Some see a bubble, but I see something different with this. I see a real fear in the US Dollar, and rightly so.

 

[jreeves]

Interesting chart.

Please further define " All social spending" so we have some idea of what on erth we're REALLY looking at.

AND, the BIG CULPRIT (rising red line) is rapidly rising Social spending, growing 14 times faster than the economy, more than eating up the decline in defense ratios (and has now reached a historic new high). (If it had been growing in dollar terms only at the rate of growth of the total economy, then that red line would have been flat on the chart. The fact the red line rises means said spending was growing much, much faster than the economy.)

Look closely at that red line on social spending. Note 3 points: (1)the acceleration starting mid-1960s, (2) this stopped rising (and declined) in the 1980s for the first time in 4 decades, (3)only to rise again thereafter to a record high in the 1990s.]

This chart almost looks as if increased spending on defense in the mid-1950's was a cover for the beginning of a socialization expansion never seen before in history. At the very least, social spending ratios were expanded 'under cover' of declining defense ratios. Social engineers certainly knew what they were doing - finding a way to camouflage their agenda. Since defense has declined to its post WW II ratios, the 'chickens are coming home to roost' - because defense reductions will no longer camouflage social spending, as occurred during the past 4-decades.

Interest (blue line) takes up an added 2% of the economy. But, it can only decline if the debt principal causing the interest is paid-down. However, debt principal is rising.

Since all war debt was satisfied by 1964, and defense spending % economy declined steadily since 1952, our nation's debt build-up must be considered non-defense - - predominately social spending growing much faster than the economy. Therefore, the interest curve (blue line) on our chart since the 1960s must be attributed also to social spending.

Anyone looking at this chart cannot escape the clear signal of the key trend that must be reversed - - its SOCIAL SPENDING! (the red line).

NOTE: For the period of the 1980s, as mentioned the 40-year up-trend in social spending was halted, and temporarily reversed. And, the rise in defense in the early 80s to complete the wrap-up of the Soviet Union (which was covered by an identical decrease in the social spending ratios). The defense ratio was then reversed to end 1980s about where it started. Today's debt totals must be laid squarely at the doorstep of long-term consumptive social spending, that still continues.

Social spending increases can no longer be camouflaged by defense reductions, and therefore must be planned to a downward slope. A political challenge considering the number of beneficiaries of such spending, but of vital necessity if we are to be equitable to our younger generation. After all, few would disagree that today's young families are paying a significantly higher % of their income for social & Medicare spending, and higher total taxes, than did their grandparents, AND they will never see even the same level of benefits.

Grandfather Federal Government Debt Report - page 1 - by MWHodges

It would include all social spending including Medicare, Medicaid and Social Security. I know you don't consider Social Security social spending but it is. If the Social Security Board of Trustees have stated that the program is unsustainable, then obivously some Social Security taxpayers will not benefit from the program. Thus taxes paid by are not correlated to benefits received that is social spending. Another popular argument is that Social Security funds are used for general tax programs. If we look at other general tax programs, social spending would be the great benefactor of these siphoned off taxes from Social Security. Due to its makeup of spending in the general tax programs excluding Social Security.

 

[jreeves]

Iraq stable? It ain't going to happen. Let the Shia and the Sunni kill each other and let Allah sort them out.

Violence being down by 80% in Iraq this year will tell you that it is achievable. Iraqis are assuming more and more responsibility in the running of their country.

 

[jreeves]

Yeah dude, and how do you possibly expect the government to make good on that debt? The only way is raise taxes tremendously, or inflate their way out of it. But that's a lot of inflation.

In the 30's, the government basically declared bankruptcy when they moved away from the strict gold standard, because they ran out of gold to back the currency. So they started to jack with the exchange, and print extra paper that was not convertible to gold. We've been bankrupt before, and there's no reason to think we can't be again. This time around, they have nothing to fall back on. All they can do is inflate the debt away, and then deflate the currency back to worthwhile value again. Hence, the boom and bust business cycles we've seen many times before. Those business cycles are another way of transfering wealth from the poor to the rich.

This is why when you say we won't see a depression, I challenge you. How much more debt do you really think this country's economy can handle, with a fiat currency that is being treated the way it is? There's no way we can pay that debt down without massively inflating the currency. The only problem is, we've sent so much paper to other countries and placed the majority of the inflation burden on them, that it's starting to catch back up with us. Eventually, those countries are going to want to dump those Dollars as they are going to become more of a liability than anything else.

We can't just bury our heads in the sand and pretend that because we are America in a "global economy", that there aren't going to be repercussions for the way we have treated the rest of the international community economically. Sooner or later, we're going to have to assume that inflation, and it looks like we're starting to see it.

This is why I think so many investors are running to commodities the way they are, specifically oil and gold. Some see a bubble, but I see something different with this. I see a real fear in the US Dollar, and rightly so.

We must at this point begin to pay down the debt. Drastically cut all programs, we haven't lost our credit rating globally. Therefore it isn't too late to reverse the spending trend. It's not too late but it is quickly approaching the time when we can't bring ourselves out of this huge debt.

It will take a prolonged period of fiscal displine, in order for our country to pay its way out. I will agree with you the prospects of debt recovery aren't to hopeful.

 

[Paulie]

We must at this point begin to pay down the debt. Drastically cut all programs, we haven't lost our credit rating globally. Therefore it isn't too late to reverse the spending trend. It's not too late but it is quickly approaching the time when we can't bring ourselves out of this huge debt.

It will take a prolonged period of fiscal displine, in order for our country to pay its way out. I will agree with you the prospects of debt recovery aren't to hopeful.

But you rely on McCain to somehow fix things because, theoretically, he won't spend QUITE as much as Obama.

The fact is, he'll no doubt still preside over more debt creation, because he serves the interests of bankers, not the people of the US. All the "friends" he mentions are people who've been in bed with Federal Reserve policies. He won't do anything to stop the over-spending. He'll collude with liberals like he always has, and spending will continue. The establishment wins with either Obama or McCain. You're fooling yourself if you think he'll be any different.

 

[jreeves]

But you rely on McCain to somehow fix things because, theoretically, he won't spend QUITE as much as Obama.

The fact is, he'll no doubt still preside over more debt creation, because he serves the interests of bankers, not the people of the US. All the "friends" he mentions are people who've been in bed with Federal Reserve policies. He won't do anything to stop the over-spending. He'll collude with liberals like he always has, and spending will continue. The establishment wins with either Obama or McCain. You're fooling yourself if you think he'll be any different.

What candidate then realistically with a chance of winning, do you suppose we should vote for?

 

[Charles_Main]

But you rely on McCain to somehow fix things because, theoretically, he won't spend QUITE as much as Obama.

Makes sense to me, if the Deficit and over all Debt are the root of our problems, then even a little less spending is better than more.

 

[Paulie]

Makes sense to me, if the Deficit and over all Debt are the root of our problems, then even a little less spending is better than more.

Says the guy who's been trying to persuade conservatives not to vote for McCain in the name of breaking the 2 party stranglehold.

 

[Charles_Main]

Says the guy who's been trying to persuade conservatives not to vote for McCain in the name of breaking the 2 party stranglehold.

All I said Is I can see his logic, I didn't say I was going to follow it. IMO libertarians would spend much less than Either major party.

 

[Paulie]

What candidate then realistically with a chance of winning, do you suppose we should vote for?

It's got nothing to do with "realistically" having a chance to win. You're not backing a winner in McCain, you're backing a fucking LOSER. Whether or not he can win doesn't help this country out of this mess.

If conservative America got off its collective ass like, say the Ron Paul Revolution, and canvassed their communities to try and drum up support for a 3rd party candidacy, such as Bob Barr, things might actually REALLY change. The problem is, most voters don't care quite enough to do any more than just show up and vote, like that's worked out in the country's favor anytime in recent memory .

Something needs to be done, we're getting stuck with big spending liberals no matter who we vote for anymore, because people are too scared to vote for SOMEONE ELSE.

You can either be a part of the solution, or part of the problem. Continuing to vote for the candidate that is just a bit less evil than the other is always going to give you evil...in this case, MORE DEBT. How can you feel comfortable voting for more debt, when you freely admit there's already too much?

 

[Paulie]

All I said Is I can see his logic, I didn't say I was going to follow it. IMO libertarians would spend much less than Either major party.

I know what you meant. But I'm not sure it's "logic". The fact is the debt is already too high, and perhaps the situation has already become unrecoverable. He says we need to stop spending NOW. So how is McCain a logical choice, when he'll still be spending too much?

McCain will never scale down the military empire. McCain will never get social spending cut back, and that's probably got a lot to do with his being in bed with the farthest left of liberals in congress, not to mention his lack of balls. The guy's been in Washington for decades. He's damaged goods. This country needs something NEW.