Obama redistribution plan in action.

[9sublime]

I'm no economist by a million miles and I'm not going to pretend I am, so forgive me if I use the wrong terms but doesn't it all break down to the fact that -

Fuel prices are artifically inflated - the companies could afford to set them much lower. E.g. 6 billion was the profit for shell or someone similiar this year. They could cut that 6 billion profit lower and pass the savings onto the average person.

However, this artifically high price is market driven because people are still willing to pay the price as it is an absoloute neccessity for many people.

Therefore, it is simply greed on the behalf of the CEOs of these fuel companies?

 

[Mr. Shaman]

so we need to focus on the rich and getting what we can from them for us?

You mean, like....expecting some kind of compensation, from them, regarding the taxes they dodged....right-before The Idiot Son pulled-the-pin on the Iraq War....a War from-which they profitted SO WELL??!!!!

 

[The Scotsman]

.........Therefore, it is simply greed on the behalf of the CEOs of these fuel companies?

Not quite that simple unfortunately mate!

A lot of the price of fuel is fixed tax (especially the UK) only 20% of the consumer price is flexible the rest is fixed thus any "discounting" from the supplier would have little overall effect.

Secondly, of the "barrel" of crude extracted from the ground only a tiny fraction goes into petrol the rest is plastics, chemicals and god knows what else. Fuel in all honesty is a by-product of the rest of the barrel and (apparently) the most expensive part of the barrel of oil! I read somewhere that petrol is not a great money spinner for the refiners/producers.... anyone in the trade can correct me on that though! Also there is only certain grades of crude which are used to refine petrol ... light sweet I think they call it which is mostly from the mid-east?

Thirdly, delivery of oil is based on "futures" contracts so deliveries are based on prices contracted at an earlier point in time thus there is a time lag between the market price dropping and the consurers getting the benefit of it.

Fourthly...or...and finally!!?? OPEC.....Oil Price Extortion Cartel.... don't want you to have cheap fuel coz they are a bunch of cr4p hounds

 

[Andy]

I'm no economist by a million miles and I'm not going to pretend I am, so forgive me if I use the wrong terms but doesn't it all break down to the fact that -

Fuel prices are artificially inflated - the companies could afford to set them much lower. E.g. 6 billion was the profit for shell or someone similiar this year. They could cut that 6 billion profit lower and pass the savings onto the average person.

Here's how it works Sublime. Oil companies purchase oil off of an international commodities market.

A commodity traders bids on stocks of oil on the market, in direct competition with other commodity traders, all of whom purchase for various companies.

Now, PetrolCo produces a tanker filled with crude oil, then tells their commodities trader to sell the oil for them on the market. The tanker of oil is open for bidding.

Let's say three refining companies start submitting bids. $75/barrel $80/bar $85/bar. Who gets oil? Obviously the commodity trader is going to sell to the highest bidder of $85, since he's paid a commission on the sale.

Now, after the refining company receives the oil from the commodities market, they refine it into various chemicals, and gasoline. Normally the chemicals are sold flat rate since generally it is more of a limited market.

Gasoline however, the cycle repeats. RefinerCo produces a stock of regular 87 gasoline, and tells their commodity trader to sell it on the market. Other traders then bid on the gasoline.

Again, oil companies do not set the price. It's market driven.

But why can't they just sell the oil for $25/barrel flat?

Ok, another mythical situation. Let say you and I have a can of soda each. I'm selling mine for $1.25, but you choose in your benevolence to sell yours for 25¢. What am I going to do? I'm going to buy your can for 25¢, and sell both of mine for $1.25.

Similarly, if the world oil market is at $65/barrel, and someone shows up with a tanker of oil to sell at a flat rate of $25/barrel, what are the other traders going to do? They are going to buy it up quick, and turn right around and sell it for as much as they can get, likely at going market rate.

Well, why can't they sell the gasoline at a loss to offset the profit of the oil sales?

Same thing there. If the going rate for gasoline is $2/gallon, and Exxon shows up with a truck of gasoline for $1, someone is going to buy it up real quick, spin around and sell it back on the market for the going rate, making an easy profit.

I was lucky enough to work at a Marathon Co, gas station. The station manager was on the phone once or twice a week with his commodities whole seller, getting an update on where the next shipment of gasoline was coming from.

There's a myth that if the sign says BP, or Shell, or Marathon, then it's gasoline all comes from that company. Not so. Most gas stations have their own commodities buyer that buys off the open market. Now most of the time the gas does comes from the sponsoring company because the company normally gives discounts on buying gas from them, but not always. The gas station I worked at, got gas from dozens of refining companies. Just depended on who their whole sell buyer could find with the lowest price.

 

[Andy]

A lot of the price of fuel is fixed tax (especially the UK) only 20% of the consumer price is flexible the rest is fixed thus any "discounting" from the supplier would have little overall effect.

True. When gasoline was selling for a dollar, when you exclude excise taxes, it was actually selling for only 25¢, which given inflation, is less than what it sold for during the 30s 40s 50s 60s. Currently almost a one full dollar per gallon is just tax.

Secondly, of the "barrel" of crude extracted from the ground only a tiny fraction goes into petrol the rest is plastics, chemicals and god knows what else. Fuel in all honesty is a by-product of the rest of the barrel and (apparently) the most expensive part of the barrel of oil! I read somewhere that petrol is not a great money spinner for the refiners/producers.... anyone in the trade can correct me on that though! Also there is only certain grades of crude which are used to refine petrol ... light sweet I think they call it which is mostly from the mid-east?

Sort of. Light sweet is the cheapest type of oil to refine. Others can be refined just as well, just at a slightly higher cost.

It's more like half the oil goes to plastics and chemicals. The other half is used for heating oil and transportation. But even then, that includes aircraft and diesel, and also some forms of water craft fuel only used by barges and military craft.

Thirdly, delivery of oil is based on "futures" contracts so deliveries are based on prices contracted at an earlier point in time thus there is a time lag between the market price dropping and the consurers getting the benefit of it.

Very true. That barge in Russia or the Middle East, takes a lot of time to get to the US. Sometimes a rise or drop in price is due to situations that happened a month or more prior. Which really drives people like me crazy since I have to explain this to all the short-term memory people who have forgotten what happened the month prior.

Fourthly...or...and finally!!?? OPEC.....Oil Price Extortion Cartel.... don't want you to have cheap fuel coz they are a bunch of cr4p hounds

Actually... I'm of the opinion OPEC is a joke. The only real purpose they serve now is as a scapegoat for politicians who don't want to explain that their anti-oil policies lead to high oil prices.

In the 70s, OPEC tried to rally for an Embargo that did absolutely nothing, and a good number of it's members refused to abide by.

In the 80s, OPEC tried to rally production to keep oil prices from going up to high, and failed horribly.

In the 90s, OPEC tried to cut production to prevent oil prices from bottoming out, and failed pathetically.

Even during the last 10 years, OPEC tried to boost production to prevent oil for reaching to high of a prices, and obviously it failed horribly.

OPEC really hasn't been successful at much accept being a target for blame by politicians wanting to escape responsibility for bad policy.

 

[laughinatreps]

LMAO!!! I think I will try this with my hair stylist!! She is such an obama supporter. I'll give the $50 tip I usually give her to the first homeless person I see and tell him/her the same thing.

ROFLMAO!!!!!!!!! No wonder you support McMaverick if you can afford a $50 tip for a haircut. at 20% that means you are paying $250 for a hairdo?

I need some high boots cause its gettin deep in here.....

I always laugh at how the right uses "homeless" people as their demographic for the people getting help, it's the only way their argument carries even the slightest bit of credibility.

Bwana, you are are one of the reasons why this great nation
of ours is going down the toilet.

As you are one of the reasons why this great nation is already in the toilet......

 

[Pandora]

ROFLMAO!!!!!!!!! No wonder you support McMaverick if you can afford a $50 tip for a haircut. at 20% that means you are paying $250 for a hairdo?

I need some high boots cause its gettin deep in here.....

I always laugh at how the right uses "homeless" people as their demographic for the people getting help, its the only way their argument carries even the slightest bit of credibility.

I used to get perms and it cost over $150.00 and had to be re done 2 or three times in a year. I dont do it anymore but I did notice normal woman just like me there getting it done also. None of them were rich, though not all of them had long hair so the perm was cheaper for some of them. I doubt one rich person goes to the places I go and it still expensive

 

[Pandora]

Oh PS

I am voting for McCain too

 

[Dr.Who]

I'm no economist by a million miles and I'm not going to pretend I am, so forgive me if I use the wrong terms but doesn't it all break down to the fact that -

I won't criticize the terms, I promise.

Fuel prices are artifically inflated -

For the moment this is an unsupported statement. But the evidence indicates that the prices that are set by US companies are both competitive and based on market forces not greed. After all, if when they go up it is greed then when they go down it must be an outpouring of altruism?

the companies could afford to set them much lower. E.g. 6 billion was the profit for shell or someone similiar this year. They could cut that 6 billion profit lower and pass the savings onto the average person.

Could they? I did not do a fact check but the last time I looked the oil companies made about 9% profit. That is certainly no higher than most industries. In fact it is about average for what most companies make in profit. As a large corporation they have the choice to roll any profit they make back into the operating expenses of the company (for development or exploration or buying new infrastructure or whatever) thus reducing the profit. They don't need to pay any tax at all if they don't want to. In fact, if the government burden gets too high they can stop paying taxes and leave uncle Sam holding an empty bag.

But they do claim a profit and for a very good reason. All the money they used to start their business was loaned to them when you bought their stock in your 401K. They owe you a return on your investment. If they stop paying out returns to stock holders then people will stop buying their stock. What would that do to the stock market and the value of your 401k?

But suppose they did it anyway. Now instead of earning whatever rate of return you get on your investment in stock your return is reduced. Maybe you were getting 6% before then it was taxed (if you did not shelter it in an IRA etc.) leaving you with 4%. Which is of course not a very good retirement plan either way. But if the oil company reduces the profit from 9B to 6B then your 6% is reduced to 4% and then taxes are taken out further reducing it to 3%. Now you have a horrible investment plan for your retirement. You might as well not buy stocks at all and just buy CD's which don't have as much risk.

However, this artifically high price is market driven because people are still willing to pay the price as it is an absoloute neccessity for many people.

AS far as I can tell there are only three sources of artificially high prices: OPEC which we have no control over, monopolies which we don't have but if we did it is government's job to break them up and not create them in the first place, and government "donations" to oil companies which shouldn't be happening anyway - all three of these sources are government sources.

 

[Unite Our Nation]

What is so funny about me having money? It is a simple fact...neither funny or unfunny. I pay the going rate to have my hair done (hilights) $200...more with a haircut included. I always give my stylist $50 or more...usually at the Holidays. Christmas I give her $100-$200. So what. What is wrong with that? She deserves it.



I am supporting McCain because of the following reasons:

1) he believes in the Contstitution and doesn't have plans to try and change it.
2) he DOESN'T believe he is God or the Messiah, or the Savior
3) he has morals and character (and no terrorists who launched and paid for his political carerr)
4) he stands for EVERYONE
5) he won't bring back partial birth abortions, which is nothing more than the killing of innocent CHILDREN. They ARE CHILDREN at the late time of 8 months old and HAVE THE RIGHT TO LIVE!!!

 

[Unite Our Nation]

Don't you love it when you read one of your own posts and see typos!!! Uggghhhh!

What is wrong with wanting to help the homeless??

Not only do I give my money, but my time towards the efforts of helping follks rediscover that they too can contribute to society. Or help those with such severe mental illness get medication and help so they aren't in harms way or harming others.

Lag, you make it sound like helping those of us with the least amount of resources is not the thing to do. Can you explain that to us?