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Automotive News & Views Are gas prices fueling your pain? 
10042 messages, Last post on Jul 12, 2008 at 3:07 PM
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$4.00.Gal in HI for REGULAR GAS! link title Regards, OW
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Replying to: circlew (Mar 14, 2008 3:21 am) A lot of the locals in Hawaii drive full size trucks. That has to be tough at $4 per gollon. Last April in Hilo the price was lower than CA at $2.16 per gallon. That was a first for me. Not sure what to expect this April. The islands do have a good biodiesel producer. I wonder what he is getting for the his product. He was making money under $3 per gallon. |
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I'm not doing anything different if gas goes above $4/gal. Why? Because I was already trying to conserve gas. I have a 2yr old Honda Fit that can get 40mpg and a Ford Freestyle that can get nearly 30mpg, both highway MPG if I keep my speed at 65mph. I probably average 25mpg in the Freeestyle and 35mpg in the Fit, or lets say 30mpg combined. And driving 30,000 miles/year combined for both cars equals 1000 gal per year, so for every $1 gas goes up costs me $1000/year, or about $20/week. Not peanuts, but not a huge amount that our budget can't absorb. And if you consider fuel cost as part of an overall transportation cost, then in addition to fuel cost, there's the cost of the vehicle, insurance, maintenance, and repairs. So people may want to look at their overall transportation cost, of which gas is one component. The Fit only cost $15K new and the Freestyle $23K new, so I've saved on overall transportation costs as compared to someone buying a $35K big vehicle and a $25K sedan. Both my cars combined are less than what a lot of folks spend on their high-end minivan, CUV or SUV. Another component is vehicle use. Even though I could probably get better MPG with a Civic or Corolla then a Fit, since the Fit has more cargo space I can use the Fit for trips instead of the Freestyle. If I would have bought a Civic/Corolla then the bigger car would have been used more, thus eliminating the slight MPG advantage of the Civic/Corolla over the Fit. Anyway, if you think about these things all the time and not just reacting when gas prices shoot up, then there is no need to do anything different when they do shoot up because you're already managing your transportations costs effectively. It's sort of like living in a healthy manner, eating right and keeping in shape versus waiting until you're 50lbs overweight and then suddenly deciding to crash diet and spend a bunch of money on exercise equipment. |
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Replying to: lemko (Mar 13, 2008 10:50 am) It only has to do with the fact that almost all of us are spending our future earnings today. The access to easy credit is what increases the money supply. It doesn't matter whether you give it to GM or to Wal-Mart or to Toyota or to the local plumber. As long as everyone only spends what they actually make in a year and nothing extra then the money supply can't get out of balance. It's only when the Fed and the banking system give us easy money to spend on whatever do-dads and junk we need that extra money is printed. This increases the money supply and decreases the value of each dollar. Reign in credit and you'll see the US$ start to climb again...but we'll also go into a crashing recession/depression. but we'll all be better for it.
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Replying to: kdhspyder (Mar 14, 2008 5:09 am)
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Replying to: lemko (Mar 14, 2008 5:13 am) That's a double whammy. Then strike three on the money supply. Consider all the people that became real and paper millionaires on their investments in the 90s. Were these profits real? To an extent yes but it also created sudden wealth which was spendable. Take the 'Redmond Millionaires' who suddenly were able buy like they've never bought in their lives. Picture a $25000 a year maintenance worker suddenly having a million bucks in the bank generating $50000 in interest annually? Helloooo. |
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Replying to: lemko (Mar 14, 2008 5:13 am) And these same people are probably also crying because they have a giant SUV in their driveway with terrible MPG that's also worth less than their loan balance. Not saying that we shouldn't help these folks, but any financial help they get should have a future payback requirement and not just a free ride until the next time they do something stupid. |
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Replying to: kdhspyder (Mar 14, 2008 5:09 am) It has to happen sooner or later. Lowering the interest just adds to the problem. I have friends that may lose their homes because of shady lending. And poor planning on their part. Too bad our schools do not teach common sense economics. Kid turns 18 and here comes a credit card application in the mail.
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Replying to: gagrice (Mar 14, 2008 5:42 am) Do not spend what you don't have. Spend a little less than you make. Regards, OW |
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Replying to: gagrice (Mar 14, 2008 5:42 am) But for the majority who saw interest only/ARMs as a way to get the house of their dreams, then sorry, let them foreclose the house. Last I checked the constitution doesn't state all citizens have a right to own their home. Gagrice, your right on the money. It's sad that many people don't understand how compounding interest/amortization works. They just see a monthly payment that they can afford completely disregarding the actual total cost those payments. Ironically vehicles are the source of money troubles for many. Many are screaming about the cost of gas, but give very little importance on what really costs them. Paying interest, taxes, insurance, etc, on a depreciating asset. Considering all of that, the fuel cost in my Suburban is small. We are going to my in-laws this weekend. It's about a 300mile round trip. We can take my wifes GrandPrix (which we hate) getting 25mpg or my Suburban (much more room and less fighting between the kids) and get 16mpg on the same trip. Hmm, it will cost about $41 to drive the GP and be uncomfortable vs. $64 in the Suburban riding comfort not to mention less fighting of the kids. I'll gladly pay the extra $23.
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