Holy shit, why don't they just stop SUBSIDIZING the oil companies when they're making ridiculous profits?

i know better then to think government cares for anything other then more money and power!

General

While I'm certainly not happy with the outcome (and completely unsurprised) I'm not so sure this is for the worst in the long run.  Didn't the gov't try something like this in the 70's and it backfired? 

4 bucks a gallon wipes out an hours worth of work for someone on minimum wage.

I don't care why the cost is going up, the price of everything is rediculous. If you are asking me to have sympathy for companies and CEOs who wipe there asses with 1,000 bills, cry me a river.

I am all for the free market, but once you get past a certian ratio it becomes counter productive to all the classes. The average CEO in America's megga corps make 400% more than the minimum wage worker. The next highest country to the US is only 40%.

You are not going to get any sympathy from me when ONE EXXON executive makes $500,000,000 per year.

Tell me where on the face of the planet ANYONE needs that kind of money? Capitalism is fine, greed helps us compete, but there is an absurdity to it all after a certain point.

AND BESIDES, we know oil products, from gas to plastic are poluting our planet, even if one wants to argue that it is not contributing to global warming, pollution does pile up. All the drilling, spills, strip mining, smog has an affect on the environment and our health.

We need to get off oil all together. And being the richest nation in the world, it is absurd that we would rather depend on others as a nation for our energy sources rather than put our heads together to come up with something that doesn't cost an arm and a leg.

Blame the cost on whomever you want, we still need to get off oil and there is no reason at all gas has to cost as much as it does.

Inflation is worldwide.  Most gov'ts cook the books on their own inflation figures.  Here's a chart to show that global inflation is at double digits in a lot of countries:

Source

Take a look at another chart:

If you had $1000 in the bank with no interest, your purchasing power would be reduced minus the inflation percentage.  Whatever you invest in your returns need to beat the inflation figures.

The US cooked its inflation figures.  The core inflation conviently excludes energy and food.  GDP is overstated which understates inflation.  Crude oil has doubled in price since last year.  Food has gone up 10-20% since last year.  And the gov't says inflation is at 6%??  Lie.

Now the issue is what is the government going to do with all this inflation.  It's not the government (White House) but the Federal Reserve.  Interest rates are at 2% now.  In the late 70s Paul Volker raised rates to 20% to control inflation.  The question is what is Ben Bernanke going to do?  I believe he's going to keep the rates down and after the election he's gonna raise them.  If rates aren't going to be raised then the dollar will collapse and we'll have hyperinflation.

Argentina was my 2nd choice to emigrate to because it resembles Old Europe, and has the US standard of living of nice restaurants, nightlife, and shopping.  Now with the female president inflation has gotten worse, so I'm scratching it out.

It's the Fed chiefs:  Alan Greenspan and Ben Bernanke

Politicians play a game of charade to show that they are 'doing something'.  So under the Bush admin we gave oil companies lots of tax breaks and subsidies...now that they made some much money they are proposing a windfalls profits tax.  Clinton was the only politician I know proposing this.  Obama will probably do the same.

The one oil company I made a good return was a canadian company: ARC Energy Trust (It's up 40% since last year).  I took US dollars bought shares of stock and it pays quarterly dividends of 12%.  All of stock is in the canadian dollar which has appreciated relative to the USD.  A lot of candian companies are paying 12-20% dividend which beats the most you get here 6-7%

Compare that with any other oil company like Exxon Mobil.  I checked their stock and it's been down and up within the last year depending when you bought it investors could have lost or gained money.  Let's say you made money in the stock.  Now Congress imposes a windfalls profit tax - that punishes the investor but not as much as the company itself (reaping the gov't handouts)

Gasoline still dirt cheap in the USA

• France: $8.80
• Germany: $8.93
• Italy: $8.93
• Netherlands: $9.89
• United Kingdom: $8.74

How do they do it?

1. They own one not two cars per household
2. Their cars are smaller
3. They don't drive as far or as often
4. They use public transportation
5. They walk and ride bikes

It's not rocket science.

We need riots like the ones happening out in Europe.  The only protests we seem to have so far are truckers holding up roads and honking

European protests against high fuel prices turn violent

The Republicans?  How about only one:  Ron Paul

He's the only republican that railed against the falling value of the dollar and rising commodity prices.  He's the only one that directly challenged Ben Bernanke in the hearings on those issues.

-RR

Just wanted to pass this along since mainstream news here isn't reporting on this.  These scenarios can easily happen here.  My guess is that government here will interfere with the market and put price ceilings and subsidize to quell riots.  In the long run it will make it worse.

***

Crossposted from: http://peaknix.com/2008/06/14/spain-shock/

It is hard to miss what is happening in Spain these days.

With $10.00/gallon gas the following is happening right now:

• More than 90,000 truckers have been striking and blockading Spanish routes for some three days now - gas pumps have gone dry and grocery store shelves are empty
• On the streets of Madrid, people raided supermarkets in bouts of panic buying. Eva Villafafila, a 34-year-old workplace safety inspector, said she stocked up Monday. “There were unbelievably long lines, and the supermarket staff said that if the strike continued, they would run out of chicken and eggs right away.” SOURCE
• Riots have been erupting
• Police are suppressing riots
• People are being beaten by those police
• At least 2 protestors have died at the picket line in Spain and Portugal

Long lines of traffic formed at Spanish-French border crossings and television stations showed pictures of abandoned lorries with broken windscreens, lights ripped out and tyres punctured after they were attacked for attempting to defy the strike. SOURCE

By Thursday June 13, 2008:

Spain promised “zero tolerance” for violence by striking truckers after a string of incidents including an arson attack on a strike-breaking truck that left the driver with burns to 25 percent of his body.
…
The government said it had arrested 71 picketers for offences including intimidating non-striking drivers since the stoppage by 75,000 truckers began on Sunday night to call for government help to cope with high fuel prices. SOURCE

Is even harder to stem the small thread of panic that you might feel if you see their troubles as an early harbinger of what collapse looks like in the western world. It really mirrors the doomer projections in so many peak oil collapse scenarios.

Humans are so predictable aren’t we?

Some people will wonder if it will remain in the Spanish context, there are signs that this contagion is spreading with similar strikes across the globe:

• UK Shell truckers (members of Unite, the union representing 641 tanker drivers) have threatened a 4 day walk-out – lines are forming at gas stations as people panic
• These same drivers are in a panicky mood because Gazprom (Giant Russion Oil Company) made public statements that oil prices could hit $250/barrel in some “near” future
• 50,000 Polish lorry drivers held one-hour protests across the country although without blocking roads
• Dutch truckers announced plans to block roads at 18 points across the country for 30 minutes
• In Thailand truck drivers voted to begin strikes next week and block roads to the capital with 400,000 lorries unless the government helps them pay for soaring fuel costs
• While in Hong Kong about 500 minibuses, lorries, garbage trucks and coaches staged a go-slow protest, crippling traffic in a demonstration calling for fuel taxes to be scrapped
• Communists burned tyres and blocked roads in parts of eastern India angered by fuel price rises but elsewhere in the country calls for strikes were largely ignored.
• In South Korea truckers voted to strike on Monday, ignoring a $10.2 billion (£5 billion) government aid package designed to cushion the impact of soaring fuel prices.
• American Truckers struck in small numbers several weeks ago with a convoy of some 500 truckers that ended up in DC where they blew their horns all at once and shook everyone for miles
• SOURCE

-RR

These truck drivers have families too.  I'm thinking they aren't going to do anything that would hurt their own family.

Marc Faber tells it like it is:

"I think there's a good chance that the Fed itself will fail one day if they say 'We're not going to let you fail,' and the government will have to bail out the entire system," Faber said.

"If I'm a bad businessman and I go out of business, who's gong to help me?" he said. "But Bear Stearns and the Wall Street elite, because they are tied into the Treasury and the Federal Reserve and they have lunch together, it's a club and so forth, they're bailed out. It's a joke!"

[edit: fixed embed tag]

Got a new food chart price increase:

-RR