Clerk, 5 Others Arrested in Cheap Gas Scheme

[Hoosier Daddy]

The way to defeat them both is to drill everywhere and build more refineries.

I'm OK with that. When do we start?

[cgarison]

It is about time someone gets screwed other than the customer

Absurd. No customer is getting screwed....this is simply the natural and automatic result of a bunch of Enviro-Nazis and the politicians who love them or they hold hostage stopping every attempt to increase supply.

Uh.... No.

Back to the story....

A modern-day oil primer:

Over the past few years, while America's economy has been booming, the economies of places like China, India, Russia, Brazil, and the United Arab Emirates have been utterly exploding. With all that growth and the money that comes with it, more and more people in those places (and others) are wanting and needing to move about (you know...work, go places, do things), and more and more people are driving and flying. China, all by itself, puts 14,000 additional cars on the road every single day! That's almost impossible to imagine, but it's the case....and it's just what China is adding. And, of course, all of those cars need gas to go...and, of course, the planes, too.

In addition, as these places are ramping businesses and infrastructure and building homes, plants, mines, and office space so strongly, all the heavy machinery that's doing the work is demanding more fuel, too.

Sooooo.....demand for oil is growing. A lot. Every day. And oil is still out there, but it's getting a bit harder to find and to get to.....it's still plenty easily doable, though.

Until those who want to and can go get it get to the politicians' "whoa!" line, that is. There, they get stopped by leftists and/or wimps being held hostage by Enviro-Nazis who are lying about the effects and risks (non-risks, really) associated with oil exploration and capture.

For example, the truth about getting oil out of ANWR -- go to your favorite map website and center over South Carolina; that's ANWR (roughly the same size). Then, zoom and zoom and zoom and zoom and zoom toward the northwest part of the state and find the Greenville-Spartanburg International Airport and the BMW plant next to it. That -- maybe even less -- would be the "giant, despoiling oil field." Then, zoom back out and get the perspective (tiny, close to the edge, etc). Oh....and realize that the "pristine beauty" is snow-covered and pitch dark the vast majority of the year and sees very, very few visitors ever.

Or oil exploration right out in the Gulf of Mexico....it's said to be "too risky" to the Gulf Coast. The truth, though, is that even Hurricane Katrina couldn't cause a drop of oil to leak from the platforms that are already out there! And, while our politicians have been holding us all hostage, Cuba has plopped a facility out in the area where some of our companies were going to go! Wonderful, huh?

Where we have and can get oil and put this additional supply onto the market, politicos are blocking bringing it up.

Now, why all this concentration on supply? Why is supply so critical? It's because of how oil gets priced. All of oil gets priced at the amount the market is willing to pay for the final barrel that's available on the open market, and "supply and demand" determine what that price will be.

What's going on now is that OPEC, Venezuela, Russia, and so forth (the countries and places that produce the largest amounts of oil) are putting on the market an amount that just ever so barely meets the growing-by-the-day demand. On top of that goes a "risk premium" that traders are willing to pay (in the form of a bidded-up price, not a stated fee or anything). Think of paying a "risk premium" like going to the grocery store a few days before a snowstorm....you're not 100% sure it's going to snow or how much it might, and the prices on bread and toilet paper and stuff aren't what you'd normally like to pay, but, just in case, you pay what you "have to" "just in case." The "risk premium" on oil, at this point, is there because there is no excess supply at this point and because of things like Iran possibly pulling some crap in the Strait of Hormuz, Hugo Chavez pulling some stunt, and so on.

So, again, why the focus on supply? Easy -- it's the only answer.

For one thing, adding supply to the market -- especially from us or some very close friends -- instantly removes almost all of the risk premium. Think about it -- if supply exceeds demand, then some part of the supply could be attacked in some way or removed from the market with little effect.

Once risk premium is out and supply still exceeds demand, then price really starts to tumble! The easy comparison is condos in Miami -- now that so many condos have been built and speculators are getting rid of their second or fifth or tenth, supply is exceeding demand, and sellers are now saying, "I'll take less! I'll take less!" whenever there's a buyer in the vicinity. $90 oil would be $72 overnight and be heading for $50 in a matter of a couple of months (the cost of claiming oil from tar sands might be the determining factor, though).

An interesting note: merely the credible threat of putting more supply on the market lowers the price! When faced by the threat of additional competition, oil producers lower their prices dramatically to try to take away the incentive potential additional producers have for getting into the business!

What about alternative fuels or conservation? Easy -- today, it is / they are all bullcrap. 14 gallons of ethanol need to be made for every 10 gallons of gas that would be replaced, and the energy needed to make and transport those 14 gallons approaches or exceeds the energy in the 10 gallons of gas. What could be more stupid??? And what does a tiny amount of conservation in the US mean when China, by itself, is putting 14,000 new cars on the road every single day?!? How does going-out-of-the-way carpooling or combining a trip to the grocery with a trip to the mall account for 5.11 million (and accelerating) additional cars driving all over the giant country of China every year??

Answers: nothing, nothing, and it doesn't and never will.

If you want to develop some other fuel for the long run, excellent! It's a great idea, and the marketplace will love and reward you for it. Today, though, we simply need to have more oil, and it would be best that it be our oil.

This is good. Lets stop the tape and discuss the difference in the price of $75.00/ barrel and the $100.00/barrel oil in December.

(sigh)

I would love to say that the last spike in Oil was due to a lack of supply and increase in demand, but it wasn't. The problem with oil is the fact that the barrel price of oil on international markets is priced in American dollars. So their is more to the price of oil than just simply supply & demand or environmental wacko-ism.

Now, as almost all of us have noticed this past Christmas season, the price of HD TVs did not go down like they have for the last 5 years. In fact, HD TVs went up in price to a level around Christmas 2005.

So what caused this spike in oil and HD TVs? It was not supply and demand of oil or HD TVs, but it was the fact that our Federal Reserve Bank and monetary policy makers have allowed the value of the American Greenback to collapse when compared to the Euro and other competing currencies. In fact, I never thought I would see a time when you can swap American dollar for Canadian dollars on a near even scale. I also thought that I would never see it take $1.50 to purchase a Euro.

So, supply and demand explain oil's journey to $75.00/barrel, but the lack of monetary policy by Ben Bernacke caused the $25.00 spike we saw in November/December.

Didn't anyone find it suspicious that oil went up to $100/barrel and gasoline did not go up beyond the price levels set by the price of oil in the summertime.

So are we "getting screwed?" Absolutely -- by politicians and Enviro-Nazis! Get their hands and lawyers out of the process, and the price drops by a third overnight (taxes go away), maybe half within six months (threat/promise of additional supply affects the marketplace), and by more than that within a couple of years (additional supply hits market and exceeds demand).

Piece of cake, really.....

Let's get the environmentalists out of this picture because they do not have a real impact on the price of rice in China as they do not have an impact on the the price of a gallon of gasoline in the US. If anything, the enviro-nazis have probably helped the US economy over the last 20 years by causing capital expenditures by corporations to produce more efficient cars and to clean up wastes prior to being dumped in the earth or in our waterways. The environmental movement has created jobs in recycling that did not exist in 1970. If anything, environmentalism has been positive although, Al Gore is a fvcking idiot by preaching things like Kyoto and greenhouse gas regulation when writing loopholes in the law to allow China and other immaturely industrialized nations around the world a free ride to pollute.

My 2 cents.

And on electric cars.... I want one so fricken bad that I can taste it. The thought of getting all the torque from a motor at 5 RPM that I can get at 1000 RPM make me and my lead foot so excited. Now where am I going to get a drive line to hold all of that insane power.

[Big Media]

Ok... so...

Free gas from a convenience store clerk --->

No one is getting screwed by big oil ---->

Kool Aid ---->

Liberals ----->

Corollary ----->

Record profits ----->

Hitler ---->

Fat asses walking ------>

The Doller vs. The Yen.


Got it.

[Arp2]

The problem with oil is the fact that the barrel price of oil on international markets is priced in American dollars....

...it was the fact that our Federal Reserve Bank and monetary policy makers have allowed the value of the American Greenback to collapse when compared to the Euro and other competing currencies.

You're absolutely right.

I'm sitting here and figuratively slapping myself in the forehead. I meant to include that but, having left the post on a tab before shutting down and finishing it another day, forgot all about it.

Didn't anyone find it suspicious that oil went up to $100/barrel...

Don't you find it amusing how the media are treating that trader who popped it to $100 for a whole second or two?

(cricket, cricket)

That's right.....they know he did it to get himself publicity, and they've largely ignored him!

The environmental movement has created jobs in recycling that did not exist in 1970.

If you're going to say that, then you should simultaneously note all the jobs in Michigan it has permanently killed.

[Arp2]

The Doller vs. The Yen.

It's more the dollar versus all the others....

You may have heard it said that America now has the second-highest business tax rate of all the big countries in the world, thus making it very hard for companies and their jobs to stay here.

The one that's even higher and in a much worse economic state -- Japan!

On a related note, I found out about an investment vehicle I wish I would have known about and understood....it involved Japan and the yen.

Japan is in such bad economic shape that interest rates there have been kept very close to zero. People (companies) here with the credit-worthiness, collateral, and relationships would go to Japan, borrow huge sums of money from a bank there, convert the yen to dollars, stick it in the money market back here (in other words, risk=zero), earn a return multiple-times greater than the interest rate they were being charged while waiting for the yen to weaken even more, convert the money back to yen at a rate even more favorable, pay back the loan, and keep the amount left over.

[Bob Campbell]

Arp, you can call the sun the moon, but that doesn't make it so. The people most hated by the Nazis were the communists. The Nazis used the word socialist as a marketing tool. It had nothing to do with their real agenda. Try hanging out with some modern day Nazis, call them leftists, and see what happens.

[cgarison]

Don't you find it amusing how the media are treating that trader who popped it to $100 for a whole second or two?

(cricket, cricket)

That's right.....they know he did it to get himself publicity, and they've largely ignored him!

He was ignored by national financial news outlets. In Detroit, the media named the poor guy in hopes of an angry mob would caravan to his house.

The environmental movement has created jobs in recycling that did not exist in 1970.

If you're going to say that, then you should simultaneously note all the jobs in Michigan it has permanently killed.[/quote]

Michigan has lots of problems, but I am not sure if they can be attributed to a root cause of "environmentalism." Yes, maintaining a good, clean, environmentally strong relationship with the comunity and country costs a lot of money, but that is not what hurt GM, Ford, and Chrysler. Poor build quality, bad engineering, and decontenting of product has more of an impact than anything else.

Plus, you have to consider that Detroit did not think they had to compete with the world. Now, Nissan and Toyota have full size trucks, market dominating mid-size sedans and luxury divisions that rival Cadillac and Lincoln. All of this happened while GM was sleeping thinking that refreshed sheet metal on a antique K platform would compete with the Lexus LS. Or Ford assuming that the 30 year old Panther platform would never have competition from Chrysler, Infiniti, Lexus, and now Hyundai.

Michigan's issues are more a problem with corporate leaders sticking their head in the sand and ignoring the cries of the automotive purchasing public than blaming the movement to maintain a healthy planet.

Plus, Gov. Jennifer Granholm of Michigan has to be the most politically inept person to ever run a state. She has done nothing to help Michigan except to kick its native companies in the side to eat sushi off the plate of Toyota.

[Big Media]

You may have heard it said that America now has the second-highest business tax rate of all the big countries in the world, thus making it very hard for companies and their jobs to stay here.

I am actually considering a move to Dubai. Those crazy arabs have indoor skiing. INDOOR SKIING. IN THE MIDDLE OF A DAMN DESERT.

If I can get a job a Al Jazera (sp?) or selling towels or something...

I am betting gas is damn cheep over there.

[cgarison]

I am betting gas is damn cheep over there.

Last I heard, it was 28 cents a gallon, but that was in August. It might have spiked to 32 cents in the last month.

[AmpedNow]

You may have heard it said that America now has the second-highest business tax rate of all the big countries in the world, thus making it very hard for companies and their jobs to stay here.

I am actually considering a move to Dubai. Those crazy arabs have indoor skiing. INDOOR SKIING. IN THE MIDDLE OF A DAMN DESERT.

If I can get a job a Al Jazera (sp?) or selling towels or something...

I am betting gas is damn cheep over there.

We need to build here like they're doing in Dubai. It's insane what they are doing over there... Artificial islands, half-mile tall skyscrapers, indoor everything.

Maybe that's a solution for WV. Just start building a massive city, airport, amusement parks, etc and they might come. Give Vegas a run for its money.

I propose that the center of this new city be Hallburn's house in Putnam county.

And one advantage WV has over Dubai: alcohol and strip clubs are legal.

[lastone]

You folks just don't get it, do ya?

China's prosperity and Dubai's and Saudi Arabia's is due to OUR money! This country is on a "capitalistic high" which will soon fail. As planned. America will be a third world country and the major corporations will move on. I hust hope I croak before it all goes down.


I am certain you young guys will pounce on that statement for you don't think about what has to happen when the factories go out and jobs go "off shore". It will take a depression to wake you people up.

I pray I'm wrong.

[fearpeddler]

You folks just don't get it, do ya?

China's prosperity and Dubai's and Saudi Arabia's is due to OUR money! This country is on a "capitalistic high" which will soon fail. As planned. America will be a third world country and the major corporations will move on. I hust hope I croak before it all goes down.


I am certain you young guys will pounce on that statement for you don't think about what has to happen when the factories go out and jobs go "off shore". It will take a depression to wake you people up.

I pray I'm wrong.

i'm nearly sure you're right...

[AmpedNow]

You folks just don't get it, do ya?

China's prosperity and Dubai's and Saudi Arabia's is due to OUR money! This country is on a "capitalistic high" which will soon fail. As planned. America will be a third world country and the major corporations will move on. I hust hope I croak before it all goes down.


I am certain you young guys will pounce on that statement for you don't think about what has to happen when the factories go out and jobs go "off shore". It will take a depression to wake you people up.

I pray I'm wrong.

I don't necessarily disagree with that, but that doesn't mean we couldn't do the same thing eventually.

In fact, if we ever do go into a depression, it may take a major renaissance of America to help get us out.

But I'm not convinced that we are anywhere near a depression, no matter how much the drive-by media wants us to be.

[cgarison]

You folks just don't get it, do ya?

China's prosperity and Dubai's and Saudi Arabia's is due to OUR money! This country is on a "capitalistic high" which will soon fail. As planned. America will be a third world country and the major corporations will move on. I hust hope I croak before it all goes down.

I remember the Buy American campaigns in the 1980s and the Made in America Campaigns at discount retail stores in the early 90s and our resilient population is still making a good living despite the off shoring of industry that has occured in the last 30 years.

I am certain you young guys will pounce on that statement for you don't think about what has to happen when the factories go out and jobs go "off shore". It will take a depression to wake you people up.

I pray I'm wrong.

The US is far from depression.

The part that is amazing is that everytime the scenario comes up where massive amounts of dollars are going off shore, those dollars come back and get invested in Americas capital infrastructure. In the 1980s it was the Japanese who got pwned by Americans through their investments in US real estate and in the 1990s the Germans got served as well. In fact, look at the billions of dollars Daimler lost on their acquisition and sell of Chrysler.

America is strong and free market capitalism is the way to go. The caveat is that we need more controls and more watch dog laws to prevent catastrophies like Enron, Worldcom, and soon to be (possibly) Countrywide.

[Bob Campbell]

What we really need is to invade some country we can easily defeat and take their.....uh......never mind.

[The People's DJ]

What we really need is to invade some country we can easily defeat and take their.....uh......never mind.