Inflation.Originally Posted by ShaneEnochs
Inflation.
well paul or nothing , the only thing you are correct about is that i did get paid when i was in the military , i received 3 hots( sometime ) and a cot , $85/mo when i enlisted , when i got out i was making a little over $200/mo , i was really cleaning up. thanks for paying my wages
as far as goverment intervention goes , i guess its not goverment intervention when OPEC controls the oil market as much as they do and you think thats great and not intervention.
i hope someday you will learn what is really going on in this crude oil market and please stay out of the kool-aid line.
for those that like to qoute the price of crude oil in relation to gold , turn it around and price gold in relation to crude oil.
crude oil is the dog , gold is the tail.
Last edited by ILUVRP; 04-08-2012 at 08:09 AM.
Well multiple reasons... The first is inflation. The monetary base has grown by 250% in 4 years so that is part of the equation. Oil is a finite resource so obviously this is much more subject to inflation than other industries. Even more so as many international oil transactions are priced in dollars.
The other reason is partly because of peak oil...we're running out of oil. This means there is less oil on the market and that oil companies can charge more for it.
Third reason is that the oil industry is not your normal supply and demand industry. If the price of haircuts goes up...another barber moves into town. Starting a new oil company is very difficult. For starters there are many patents to deal with in the oil industry that are owned by the big dogs and make it very difficult for the startups to have a chance. Standard oil used patents very effectively back in the day to consolidate it's control over the oil industry. The access to oil is also very political...if you don't have the political clout to get contracts signed with dictator X or to get sweet-heart lease deals in the Gulf of Mexico from corrupt congressman...you're out of the loop. The other problem is distribution. Oil companies again rely on eminent domain to get the pipelines and roads they need to service their oil wells. Problem is this really favors insiders and creates an uncompetitive situation. The rail industry is largely created on the efforts of huge eminent domain purchases...and the lack of competition in the rail industry causes problems for startups trying to get into the oil industry as well. You're not going to be paying the same shipping freights that Chevron does...but the rail industry can get away with this because it would take more eminent domain to create competing railroads and this won't happen. Environmental regulations are a whipping boy from republicans when it comes to high gas prices...but this isn't accurate...and we need environmental regulations to prevent market externalities (lawsuits won't cut it). To a certain extent environmental regulations applied unfairly (that favor the status quo) do hurt competition. For example...Chevron gets to operate their oil refinery with no problems...but you wouldn't be able to create a similar refinery because of environmental regulations. That's not quite fair...but I think we have to be careful about what we de-regulate. If we let startup X create a refinery...a seven sister will buy them up and shut the refinery right back down (like they've doing all over the place) to keep prices down.
A lot of cool oil alternatives are out there...so I actually like the idea of the oil companies consolidating their control over the oil market to reduce supply and raise prices. This will encourage the market to develop alternatives which we so dearly need. Cool video on this subject I would recommend is called 'Gashole'.
Energy Companies searching hockey leagues for potential employees. Chamber of Commerce worries about lack of workers causing poaching by energy, mining and forestry companies. Where are the jerbs? Here are lots of them.
http://www.vancouversun.com/business...712/story.html
You'd have to move to Canada, but the folk seem pretty friendly up there.
"Your mother's dead, before long I'll be dead, and you...and your brother and your sister and all of her children, all of us dead, all of us..rotting in the ground. It's the family name that lives on. It's all that lives on. Not your personal glory, not your honor, but family." - Tywin Lannister
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