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$4/gal gas by spring?

Discussion in 'Fred's House of Pancakes' started by klodhopper, Dec 27, 2007.

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  1. klodhopper

    klodhopper New Member

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    #1 klodhopper, Dec 27, 2007
  2. Godiva

    Godiva AmeriKan Citizen

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    Right on schedule.
     
    #2 Godiva, Dec 27, 2007
  3. malorn

    malorn Senior Member

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    If the economy continues to go south, we will have $2.50 gasoline by April.
     
    #3 malorn, Dec 27, 2007
  4. hycamguy07

    hycamguy07 New Member

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    I heard 3.75 by April.
     
    #4 hycamguy07, Dec 28, 2007
  5. daniel

    daniel Cat Lovers Against the Bomb

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    Is that the official line from General Motors? "Buy your gas guzzlers now because by spring the price will be down!" ??? Thanks Malorn. It's good to know what new propaganda GM is putting out.
     
    #5 daniel, Dec 28, 2007
  6. amped

    amped Senior Member

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    Weren't we supposed to have $5/gal. gas by October 2004?

    Nobody knows when supply is monopoly controlled. The experts like making the news to promote themselves and count on short attention spans.

    My forecast? My '09 Camry Hybrid arrives next month.
     
    #6 amped, Dec 31, 2007
  7. patsparks

    patsparks An Aussie perspective

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    I'm looking forward to the price dropping to $4.00 per gallon here. We pay about $5.00AU per US gallon and I believe that is cheap compared to Europe.
     
    #7 patsparks, Dec 31, 2007
  8. malorn

    malorn Senior Member

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    No, just supply and demand. If the economy continues to tailspin and demand falls, what do you think will happen? $4.00?
     
    #8 malorn, Dec 31, 2007
  9. patsparks

    patsparks An Aussie perspective

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    And as supply falters and dives? What then? $2.50?
     
    #9 patsparks, Dec 31, 2007
  10. TonyPSchaefer

    TonyPSchaefer Your Friendly Moderator
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    In order for demand to fall, fewer people would need to be driving. Would that mean fewer people would be going to work? Is that because all the companies have closed or because they are working from home or perhaps they are all carpooling? Is it because the government will begin issuing electric vehicles or because teleportation will be invented in January?

    Your reasoning follows the most elemental concept of supply/demand as laid forth on the first day of a high school Introduction to Economics class but you fail to cite any reasons to cause you to draw those conclusions and fail to paint the futurescope perspective of what that world would look like.

    Please indulge us.
     
    #10 TonyPSchaefer, Dec 31, 2007
  11. bat4255

    bat4255 2017 Prius v #2 and 2008 Gen II #2

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    Won't happen.

    You might see $3.50 for a short time, but typically, when the price goes up, and you start seeing talk about alternatives, then the price magically drops. :rolleyes:

    Amazing, isn't it, how the feds. subsidize the oil costs to keep the price low enough, so alternatives are priced out of the market.

    There is no competition for the oil companies if the price of gas is kept low.
     
    #11 bat4255, Dec 31, 2007
  12. malorn

    malorn Senior Member

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    The building industry is operating at less than half of capacity. That means 1/2 of all those pickups are parked. Bulldozers parked. People laid off who are not driving as much to the mall etc, not buying as much. Don;t buy as much, there is less trucking and commerce in general.
    Also manufacturing continues to slowdown as have orders for heavy trucks.
    Quotes form WSJ:
    Continued concerns regarding high oil prices, weak dollar and weak housing sector." (Chemical Products)
    "Erratic market causing more difficulty in forecasting customer demand." (Computer & Electronic Products)
    "Heavy truck market has not started recovering yet." (Fabricated Metal Products)
    "Business is off by almost 50 percent over last year in the building products industry." (Nonmetallic Mineral Products)
    "More inquiries from international customers than domestic." (Machinery)

    The only section of the economy that is really doing well is sectors relating to imports.
     
    #12 malorn, Dec 31, 2007
  13. TonyPSchaefer

    TonyPSchaefer Your Friendly Moderator
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    Links, please.
     
    #13 TonyPSchaefer, Dec 31, 2007
  14. malorn

    malorn Senior Member

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    #14 malorn, Dec 31, 2007
  15. TonyPSchaefer

    TonyPSchaefer Your Friendly Moderator
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    Cool. Thanks. It would have been easier if you had just provided it in the first place but that's neither here nor there anymore.

    First off, I take issue with the inclusion of the bullet-item quotes. I have worked many jobs and positions in my time, one of them being Marketing. I know as well as anyone that if I have 100 people tell me that my product is a piece of crap, I will quote that one person who says it's a good product. Movie execs do this on a regular basis. The only way I would believe those quotes represent the majority of respondents is if the paper indicated as such. Since it doesn't, I have my personal opinion that those are one-offs and might or might not represent the overall opinion.

    Secondly, the last line of your response: "The only section of the economy that is really doing well is sectors relating to imports." was thrown in as though part of the quote or part of the WSJ paper. It was neither; it was personal embellishment. In the future, to make things clear, I would suggest that you wrap the (quote)(/quote) tags around the actual quote to remove any doubt. Personal opinion near quotes blurs the line between the two and weakens them both.

    And about that personal opinion itself, the paper clearly says,
    I fail to see how this represents "really doing well" especially leading into the holiday season. It will be interesting to see what the report says in a month about December's imports numbers.

    Overall, having read the report, There are a few things that jumped out at me.
    As for PMI,
    While it is possible to make some speculative connections between the drop in employment and the drop in imports pointing to a drop in overall purchases (especially when it seems to me that a vast majority of the items purchased in general are imported: clothes, electronics, toys, etc), I simply can't foresee the oil companies having pity on those who are not working, driving, and buying. I can't imagine the Big Oil execs who told the American public to go pound salt when they posted billion-dollar profits is going to suddenly grow larger hearts. It might have worked out that way for the Grinch but I don't see it in this case. After all, those who are still working and driving will still need gasoline and the oil companies still like record-breaking profits.

    At the end of 2008, we will know which way the price of gasoline went. Right now, I don't claim to know the future any more than I believe you do. But personally, I believe we will see $4.00/gal gasoline in the United States before we see $2.50 again.
     
    #15 TonyPSchaefer, Dec 31, 2007
  16. malorn

    malorn Senior Member

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    I have watched these indicators very closely for about ten years(when I started seriously investing in the stock market), and I have found that they are usually 2-4 months behind what is going on locally. Much of the last period of economic growth was done on the back of the boom in the housing market and the double digit rate of growth in the value of homes.

    Many things were financed on that paper equity created by the housing bubble. At one point about 20% of all the cars we were selling were being financed through a home equity loan, which has subsequelty evaported. i think the next year will be a less than 16 million vehicle market which would put it among the worst auto markets in my professional years in the auto business.

    I think the US is in the first three-four months of a full-fledged recession which will be reflected in the coming economic data. I sincerely hope I am wrong, but there are too many factors pointing otherwise.

    Good article on the subject:
    http://www.marketwatch.com/news/story/story.aspx?guid={e18e95af-dbff-4ee4-acf7-530a3cd714d3}
     
    #16 malorn, Dec 31, 2007
  17. sulman

    sulman Introspectator

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    I agree the economy is headed South and demand will taper. However, I think the oil producers will manipulate supply to keep prices high.
     
    #17 sulman, Dec 31, 2007
  18. malorn

    malorn Senior Member

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    Maybe, but in the past they all get greedy and want to keep the revenue amount up so they keep production way up. Time will tell, but there is also the chance the bottom could fall out, there has been much more speculation in oil futures with this price spike than in past price spikes.

    Interesting article? http://www.bloggingstocks.com/2007/12/28/with-oil-its-cyclical-theory-vs-emerging-market-demand/

    Remember what happened in 1986 to the price of oil?
     
    #18 malorn, Dec 31, 2007
  19. bat4255

    bat4255 2017 Prius v #2 and 2008 Gen II #2

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    +1
    $2.97 and dropping
     
    #19 bat4255, Feb 7, 2008
  20. malorn

    malorn Senior Member

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    Does anyone want to have a friendly wager about the price of gas on say April 15th?
     
    #20 malorn, Feb 7, 2008
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