My dad always says that prices haven't gone up at all, what are you talking about? Anytime someone brings up the price of gas or something else going up. Then he says the value of our dollar has gone down, not the price of goods going up.
My dad always says that prices haven't gone up at all, what are you talking about? Anytime someone brings up the price of gas or something else going up. Then he says the value of our dollar has gone down, not the price of goods going up.
refering to my post on page 1 , i agree that the value of the dollar has a effect on all goods , that being said --the price of crude would be about $30-$40/ba if the dollar was at the level it was 10 yrs ago. thats why i said crude oil should be $50-$60/ba now.
the price of gas ( only gasoline ) is about the same everywhere , just because countries put a $3-$4 tax per gallon on the cost doesn't change the price of the gasoline its self.
if the price of crude were $50-$60/ba every family (and truckers having much more ) that use gas/heating oil/diesel fuel would have $200-$400 extra every month to spend on other goods they need.
this should be one of Ron Paul's big items to talk about.
Although this is somewhat accurate, prices ARE going up because wages are not going up as fast - therefore the real cost is going up for about 95% of people.
Originally Posted by Ronulus
So would you require that everything sold has to be physically delivered? Bicycles? Refrigerators? Just oil? Does it have to be actually physically delivered to your property? Would we have to "speculator police" monitoring all our transactions to make sure we're really receiving the goods? Sounds more like totalitarianism than a free market to me.
http://www.lewrockwell.com/williams-...liams80.1.html
Hey, doncha know it's those evil greedy Arab oil-cartels, that's what driving the prices up or it could be those slimy speculators!
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Oh yeah, those cartels & those speculators!
People who blame the "speculators" don't understand how the markets ACTUALLY work, the contracts bought are always equal to contracts sold because nobody can buy unless someone is willing to sell so raising margins doesn't do much, all it does is reduces the number of players & volumes go down & bid-ask spread increases & volutility is increased even further because the flow of information that directs prices is tempered
And why an arbitrary number like 75%, let's have 100%, I mean it's not like we see stock-bubbles since they have to bring in 100%..............hmm, ok, wait a minute..........
These speculative-markets aren't just there for people to gamble, they're there to allow markets to continually assess prices of things, especially those which have longer production-cycle. Before the advent of exchange-trading, prices would fluctuate MASSIVELY from one end of the spectrum to another, sometimes there used to be glut & prices used to go dirt-cheap & producers would get wiped out by losses & since it's dirt-cheap, producers would produce less & by the time, products hit the markets, there would extreme shortage & prices rising sky-high & that again, would cause producers to produce a lot more to exploit high-price & then so on & so forth
So the exchange-trading & "speculators" play a role of "middlemen" between producers & consumers, they are constantly trying to anticipate supply & demand & keeping the markets "liquid" allowing for a continuous assessment of prices by the market, after all, "prices" there are merely people's perception & expectations of supply & demand so when the move over a period of time, it's ONLY because of information relating to supply & demand
People don't speculate to lose money, they do it to make money but when prices move in a particular direction, it starts wiping out those in the "wrong-direction" & rewards those in the "right-direction" during a given period of time but in the longer term, it's the information that moves prices & the markets reward those who are anticipating supply & demand correctly & they make money while those who don't lose it, again, that's the function of the "speculators"
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You know, that's how it works, prices rise due to inflation caused by central-banks/governments (in conjuction with supply & demand of course) but they're always looking to blame someone else, they tell workers that the reason they can't keep up their living-standards is because of "greedy evil corporations raising prices", businesses think it's the "greedy workers & unions" that keep asking for more, bubbles are blamed on the "greedy speculators", crises are blamed on "evil greedy bankers" but what about the REAL CULPRITS? - central-banks/governments/politicians/regulators
Here's another nice explanation on basics & necessity of futures-markets - http://www.investopedia.com/universi...#axzz1muWl5aaw
Last edited by Paul Or Nothing II; 02-20-2012 at 01:59 AM.
There is enormous inertia — a tyranny of the status quo — in private and especially governmental arrangements. Only a crisis — actual or perceived — produces real change. When that crisis occurs, the actions that are taken depend on the ideas that are lying around. That, I believe, is our basic function: to develop alternatives to existing policies, to keep them alive and available until the politically impossible becomes politically inevitable
- Milton Friedman
In 1998 or 1999 oil briefly touched $8. For about a week, gasoline was $0.96 per gallon in Connecticut and this state is always higher than the national average.
OPEC existed in 1999.
Problem is, the OPEC countries don't really get along and they have conflicting goals. Some countries want to keep oil prices low enough so that there is no incentive to create alternative technologies. Other countries want increased prices because they need more revenue. When the countries that want increased prices have control and they vote to reduce output, each individual country wants someone else to reduce output so that they can take advantage of the high prices and produce at full capacity. They all try to cheat on each other. There is no enforcement mechanism. The OPEC production quotas are rarely meaningful. OPEC's reputation exceeds its influence.
If the price of oil rises to high for to long, you will see a large increase in investment into alternative energy technologies. It may already be happening, who knows. In any case, that is how the free market keeps a check on abusive monopolies. It's far more effective than government controls, which, depending on which way things went, could either end up in shortages or with subsidies and extending the lifespan of old technology.
"Government is not the solution to our problem; government is the problem."
Ronald Reagan, 1981
Gas and home heating oil are absolutely killing me.
I just paid close to $4/gallon for home heating oil and gas was $3.57. Considering my house is older and has poor insulation and I drive 30 miles to work each way, it's getting very expensive.
High energy costs and high unemployment are a recipe for disaster.
really? it's as simple as inflation?
Why haven't housing prices continued to rise if that's the case?
let's check that claim first. What are things that gone down in price?
Labor? Electronics? Obsolete technology such as paper printed media? Are you counting post-bubble houses too?
What about loans, are they cheaper or more expensive?
In 1950 you could buy a gallon of gasoline for one silver quarter.
Today you can buy a gallon of gasoline for one silver quarter and get change back!
NOBP
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