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Jaqhama
Adventurer
      
Date Joined Oct 2007
Total Posts : 303
| Posted 5/1/2008 2:41 AM (GMT -4) |   | Petrol in Sydney is $1.50 per litre.
That's expensive for us.
People who drive are complaining bitterly, but as Lin and I only have motorcycles, and 2 of them are 250cc, it's not something that really bothers us.
I now only use my 650cc BMW to ride to work and back.
Yearly registration for any bike over 250 is now $500. A 250 is only $254.
A car is $500 and the price goes up depending on if it's a Ute or a van or a small truck. And again if it's a commercial vehicle.
My State of NSW really gouges vehicle users.
Then you can add the private, fully comprehensive, vehicle insurance, which many now don't have, because that's getting more expensive also.
I haven't had my bikes insured for 20 years or more.
We're going to sell the Ducati because we're not using it enough to justify the extra $500 a year to keep it on the road.
Food apparently, has gone up because of trucking/transport costs...again we haven't really noticed. But we normally shop at night, when the stores have lots of stuff like bread and meat discounted.
When petrol gets to $2.00 a litre. (And it will) Then people who drive long distances to work in Sydney CBD are going to have problems. Interest rates have gone up quite a bit in the last few years, and again last month...so with the house payments and the petrol increase a great many people are beginning to feel the extra monetary expense.
Let's not forget that wages have NOT gone up to combat the added increase in living costs.
We rent a riverside apartment and the rent is very cheap between two of us, so again Lin and I have not been affected.
When (if) petrol ever reaches $4.00 a litre there will be anarchy. People outside of the Sydney metro area, thousands of whom have to drive from rural areas 100kms or more out...those people won't be able to afford to drive to work everyday.
Our public transport system could never handle thousands of extra people using the trains and buses, so that scenario is not good.
I see a lot more motorcycles and scooters on the roads everyday now (which is great) and I fully expect to see a hell of a lot more as the months go by.
If petrol continues to get more expensive at an ever more quickly increasing rate, and oil begins to become in short supply, as the peak oil experts claim it will...and electric vehicles aren't as practical as petrol powered vehicles; and at this point in time electric wheels are not. (Short distance and long re-charging times and no power outlets in thousands of public places) Then western countries that rely on the car as major transport and usage are going to have real problems.
First petrol will be rationed. Then only food and essential service vehicles will get the majority of petrol.
But if people can't afford to drive to work...then can't pay off their house or buy food...I leave the rest up to your imagination.
People in third world countries will be fine. They are used to having nothing.
Places like Nepal will suddenly look like a good place to live.
Happy days ahead.
Cheers: Jaq...the Doomsayer.
You can read some of my stories here:
Swamp Story. Down South. Florida Haze.Wild Justice...
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erazmus
Master
Date Joined Jul 2005
Total Posts : 4461
| Posted 5/1/2008 4:15 AM (GMT -4) | | | | |
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Rob Santa
Sage
Date Joined Apr 2004
Total Posts : 1329
| Posted 5/1/2008 9:16 AM (GMT -4) | | A political cartoon pointed it out nicely: a man on the phone holds a page labeled GAS CARD BILL and says, "I understand the irony of this, but I can't afford to drive to work today." Gas prices hurt those who are living paycheck to paycheck.
If you'd like to do some fun with math, try this. (And before anyone protests, I understand this math is thoroughly fuzzy and things don't actually work this way. Still, it's a fun exercise)...
A few weeks ago the CEOs of the five US oil companies went before Congress to justify the 128 billion dollars they made in 2007. Yes, Virginia, that's with a B. They gave some very good answers, ones I agree with. Primarily, they talked about how the profit was a reflection of sales, and when compared to other businesses, the oil companies profits were a smaller percentage than most. Fair enough. The US is a profit-driven economy (as are most), and I say businesses should make profit as long as consumers purchase the product. Still, 128 billion seems excessive in a day when people are strugglling to make ends meet. Another great answer was how many mutual funds are oil company-dependent. Lower profits for the oil companies affect all those people with retirement plans connected to oil stocks. I agree less with this statement as a substantial profit for the oil companies still drives up the value of the stock; excessive profit is unnecessary.
But what's excessive? The president of Argentina just imposed a 60% tax on all oil company profits deemed excessive. Sure, that's a great way to get money back in the government coffers to give to the people who paid too much for the oil to generate the profits that are getting taxed. What?
Anyway, let's go back and look at 128 billion dollars in profits. Is it excessive? For the sake of argument, yes. Let's pretend $28 billion is more than enough profit (and I assure you, it is). How did the oil companies generate another $100 billion in profit. Remember, we're not talking revenue here; we are talking about an extra $100 billion after all expenses have been paid (drilling, exploration, refinery, transport, etc.).
Once again, for expediency's sake, we will assume the $100 billion in profit came only from the sale of gasoline. We'll also assume that of the 300 million people living in the US, all of them drive (or get driven somewhere-in other words, used gas last year).
300 million people goes in to 100 billion dollars to make $330 of excessive profit per person. A family of four, to put a fine point on it, paid $1300 too much for gasoline in 2007. If they put 20 gallons of gas in their vehicles each week (10 per car, not unreasonable) then they put 1000 gallons of gas over the year. At an additional profit of $1300, that means each gallon of gas cost $1.30 more than it should in order to generate an additional $100 billion in profit.
Fun when you think about it this way, isn't it?
But here's the beauty part...if gasoline prices stayed exactly the same the US oil companies would stand to profit over $100 billion dollars again this year. But they didn't. "Analysts" predicted the price of gas would rise to $3.60 per gallon by July, and this was as good as tacit permission for the gas distributors to raise their prices immediately. It took my local stations eleven days to raise the price from $3.35 to $3.60 when the "study" came out at the beginning of April.
So here's my prediction: US oil companies will generate a profit in excess of 200 billion dollars for 2008.
Rob Santa
Hopelessly Addicted Writer of Speculative Fiction
and CEO of Ricasso Press | | Back to Top | | |
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Frank
Adept
Date Joined Aug 2005
Total Posts : 627
| Posted 5/1/2008 1:04 PM (GMT -4) | | I'm a small retail business owner operating in Florida, where the economy relies almost entirely on tourism and snowbirds, and I have a 33 mile commute each way, seven days a week. I've been feeling the crunch on several levels for almost two years now.
For one thing, more than 99% of my stock is merchandise that's manufactured overseas so as the U.S. dollar gets weaker my cost on everything increases. At the same time my cost of living is rising dramatically in large part due to my commute. When I started my business seven years ago gas was $1.60 (and I thought that was high...).
I seel beads for making beaded jewelry and I also carry gold & silver among my many items. That means in my little shop you can see the convergence of many factors in our economy:
Most of my glass beads are made in Europe, specifically the Czech Republic and Italy. My crystal beads come from Austria. My gold and silver beads and findings come from Indonesia and India. My jewelry making tools are made in Pakestan. Seed beads come from Japan. Ceramic beads and some items made from natural materials come from various South American countries. My bone and wood beads, along with some brass and copper stuff comes from Africa. Some of my wire and stringing products are made in Germany. Finally, all of the semi-precious stone beads go through China for cutting, polishing, and drilling, no matter where they're mined, even stones mined right here in America are sent to Asia for processing and then shipped back here for sale.
Of the thousands of products in my shop, only two things are made in America: the books and magazines are still printed here (though in some cases that is also changing) and one brand of wire (Soft Flex) is manufactured in the U.S. That's it. Everything else is imported and I've been experiencing quite a squeeze between increasing costs and trying to stay competative in my prices.
Plus, as the stock market plummets, prices on commodities like gold & silver jump frighteningly. When I started in this business silver was 6-7$ an ounce. By 2007 that had doubled to $14 an ounce. Then, in the last two months there was a rare spike in price up to $20 an ounce. It's come back down somewhat, hovering around 17-18$ an ounce but that's still a huge jump. My customers, many of whom use a lot of silver, are freaking out! I keep delaying my next silver and gold order, hoping the price comes down a bit further cuz I can't afford it. Meanwhile my stock is becoming noticeably depleted and I have nothing to refill the empty trays, making me look like my business is failing.
Add to all this the tourism factor in may state, which has been falling steadily for two and a half years, causing almost all business in Florida to lose money or fail entirely, which means locals lose their jobs so they don't have as much money to spend either. The whole thing spirals downward until we find ourselves in the current situation. My peak year in business was 2005 and I've been operating at a loss since then.
Then throw in the fact that Florida has been among the worst states in the national disaster that is the housing market and my bank, Wachovia, has been among the worst affected financial institutions.
I feel like a character in a greek tragedy. | | Back to Top | | |
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Anthony G Williams
Greybeard
Date Joined Apr 2007
Total Posts : 380
| Posted 5/2/2008 5:22 AM (GMT -4) | | It's biting here in the UK: the ruler Labour Party just came third with 24% of the vote in yesterday's local government elections, which indicates the general disillusionment.
Some of the reasons for this are self-inflicted (e.g. Labour messed up a tax change which was demonstrated to hit the poor harder than the rest), some to do with the international financial slow-down, as our banks got sucked into the US sub-prime mortgage debacle. As a result, our housing market is beginning to slide, with mortgages getting much harder to obtain, and much more expensive. Fuel prices now average £1:10 per litre, which is about US$8:20 per US gallon. Pension schemes have also been getting worse for some years, adding to the general gloom.
I can't complain as I'm one of the lucky ones so I haven't personally noticed any hardship, but a lot of people are suffering.
Tony Williams
Scales (2007), The Foresight War (2004)
Homepage: http://www.quarry.nildram.co.uk
SFF Blog: http://sciencefictionfantasy.blogspot.com/
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DAWaverly
Quirky Weirdness
Date Joined Jul 2006
Total Posts : 186
| Posted 5/2/2008 10:37 AM (GMT -4) | | IMHO we are on the brink of a world spanning depression. The home loan market and business loan markets are naught but a house of cards.
The problem?
Some banks, like the Bank of Japan (there are others) have for years and years floated loans at nearly 0% to other banking, holding, and financial-like institutions. These banking, holding, and financial-like institutions borrowed money to lend to other people, like home-owners and small business start-ups. These banking, holding, and financial-like institutions thought that the nearly 0% rates would stay, and overextended by BILLIONS of dollars. The Bank of Japan raised rates in February. Suddenly this nearly free money started costing money, and there were shortfalls. The first cards to fall lead to the sub-prime debacle.
The second batch of card are still falling. As a result of foreclosures and a downturn in sales, property values around the world (in general) are soft. Many investors and individuals are finding that they owe more money for their home or business than it is worth on the market. Equity has vanished.
Now major financial institutions are on the brink of folding. There will be some buyouts which will prop-up the house of cards a little longer. But it will fall down and it will be ugly when it does.
Our best hope is that the fall is slow enough that average Joe Citizen around the world will wake up and realize that they need to tighten their belts before the crash hits bottom.
As far as gas prices go, here in the USA I feel lucky that we do not pay the steep taxes on gas that citizens of other nations do. In the UK the gas tax is over 50% of the price, right?
- Deven
Blogtide Rising
published
"The Journey" at Every Day Fiction
forthcoming
"An Awakening of Shadows" in The Infinity Swords anthology from Carnivah House
"All That Glitters" at Every Day Fiction | | Back to Top | | |
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Rob Mancebo
Adept
Date Joined Jul 2005
Total Posts : 832
| Posted 5/2/2008 10:24 PM (GMT -4) | |
darkbow said...
With all the talk and concern about the economy, just wondering how it's affecting folks here.
- I drive a 42 year old beetle so gas & car parts aren't too much(We decided not to get into debt over a new car last year--seems to have been a good choice.) Folks are still slaughtering beeves, goats,chickens, and growing crops just up the road so, as food prices go up, I can still get food from the local sources. I'm expecting the economy to be down for a good year or more. I'm just busy paying off bills as fast as I can, which has been my plan for the last several years. They're low enough that, even if I have to work at McDonalds, I should still be able to keep up.
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Jaqhama
Adventurer
Date Joined Oct 2007
Total Posts : 303
| Posted 5/3/2008 1:53 AM (GMT -4) | | The main concern in many cities around Oz is that in the near future people won't be able to afford to drive to their jobs.
Thousands upon thousands of people live 60 to 100 kms from their place of work.
Petrol is going to hit $2.00 a litre before the end of the year. A household where the husband and wife both need a car each to get to work is going to be a problem.
Our buses and trains won't handle the extra strain of more commuters. A guy in Perth told me their train system is too small altogether.
Can't afford to drive to work=no money=no house repayments=no food=etc etc.
And electric vehicles are a joke at this time, they're all but useless for normal commuting/transport.
Biodiesel? Be ok if we can use the entire North American/South American continents to grow crops on. Bio-D will never replace petrol. Couldn't grow enough of it.
Sure you guys won't mind moving continents?
People here are begining to worry about their future in regards to petrol/transport/work.
Sure they can buy motorcycles and scoooters...but that's really a short term solution.
You can read some of my stories here: Swamp Story. Down South. Florida Haze.Wild Justice...
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southernweirdo
Stablehand
Date Joined Apr 2008
Total Posts : 49
| Posted 5/3/2008 1:19 PM (GMT -4) | |
xiaotien said...sorry to hear you guys are getting hit hard in britain, too. my hub is english and we got back every year to see his family. and boy do we get kicked in the rear with that dollar to pound exchange. it was $2.10 for each english # last go. made me cry. it did.
Yeah, the dollar is definitely shrinking.
My brother in law summed up the current state of our economy best:
"It's rough when working an hour at minimum wage isn't enough to buy a gallon of gas and a gallon of milk."
Southern Fried Weirdness
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