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Automotive News & Views How does gas at $4 and higher impact you?
2183 messages, Last post on Nov 21, 2009 at 5:13 PM
You are in the Automotive News & Views Forum. Your Hosts are steve_ & claires
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Replying to: oldfarmer50 (Jan 07, 2009 12:58 pm) Well fed tax on diesel is something like 6 cents a gallon more than gas. Add to that that semis get relatively poor mileage (like 6-8 MPG) they tend to pay more in taxes. In reality on a per mile basis a semi will pay at least 6 times what a car pays. Businesses don't PAY taxes they simply PASS THEM ALONG. If you tax truckers more for road use they either charge you, the consumer, more for shipping or they go broke. This raises the price for everything delivered by truck. So you end up paying the tax. Not true. Without going into a long economics lecture complete with graphs and formulas I will say that business's pass along part of the tax, but not all of it. It all depends on the economies involved with the particular good. But in almost all cases business's do pay part of the tax. There have been instances where business's have paid all the tax. |
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Replying to: oldfarmer50 (Jan 07, 2009 2:24 pm) So you don't think that speculators can make money when prices are falling? Believe me - they can. It matters not whether prices are going up or down, so long as they are moving. Speculation is nothing more than an informed bet on price movements. The key word here is "movement". The actual direction is irrelevant. What a speculator hates above all else are stagnant prices. If, for example, oil prices stabilized at, say, $60/barrel & stayed there for 6 months, you'd hear real screams of pain. Something like that happened to currency markets in the mid 90s. For a couple of years, there was no discernible trend in prices. Imagine the plight of a sailor on a hot, windless day. That's how it was for currency traders. Some of them left the business. If oil drops to $10/barrel next week, at least some speculators will get very, very rich. |
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Replying to: snakeweasel (Jan 07, 2009 3:36 pm) Very true, except for shipping and transportation. Trucking will charge based on fuel charges as a prime concern. Raise fuel taxes and that price becomes a direct cost to the vendor or the customer. If the manufacturer or the end customer wants to cover part of the price based on gross sales they can but it takes only a few weeks for grocery products to go up because of increased fuel prices. But just like gas stations it seems to take longer for the prices to come down. But that could be because the manufacturer or end vendor decide to cover the increased cost for a short time and re-coop after the adjustment. |
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Replying to: snakeweasel (Jan 07, 2009 3:36 pm) My point would be car weighs 4000 lbs, truck weighs 80,000 which is 20 times the load. With that argument, trucks would be paying around 1/3 per weight unit. On the other hand...18 wheels vs 4 (not considering the weight per tire) would equate to a ratio of 4.5, so 6 time would be overpaying. My opinion is that trucks cause more damage than they pay in relative tax, but I have no data to prove it. 
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Replying to: wlbrown9 (Jan 08, 2009 10:34 am) They never seem to have an explanation when I ask how the rain manages to fall in parallel ruts on the roads. 
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Replying to: steve_ (Jan 08, 2009 11:12 am)
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Replying to: gagrice (Jan 08, 2009 1:04 pm) What I have seen in East Arkansas (no studs allowed on tires) seems to be based somewhat on the local ground. This area is all silt from the Mississippi river...1/4 - 1/2 mile deep before you hit bedrock. Mississippi embayment runs from Little Rock to Jackson, TN. When they built these interstates the roadbed was not prepared deep enough. Original concrete I-40 started breaking up after a number of years plus weight limit was raised from 72,000 to 80,000 to match the rest of the country. Eventually asphalt was laid over the repaired concrete. The asphalt eventually developed ruts due to the heavy weight traffic. A major factor in this was lack of support from the silt under the foundation of the roadbed as well as the increase in load limits. |
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Replying to: snakeweasel (Jan 07, 2009 3:36 pm) Oh come on, I LOVE graphs and formulas!  I guess my point is that there is no free lunch. The choices we make will have many concequences, some intended, some not. A business can only absorb so much additional cost. Competition can hold off prices increases for awhile but in the end prices rise or the business goes bust.
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Replying to: oldfarmer50 (Jan 09, 2009 4:30 pm) the guy that used to do them quit so they asked me to do them. of course i said yes. the next week he came back, but i am still doing them.  btw, i have almost a 1/2 a tank of gas left and i filled up on 12-29, so $4 gas wouldn't hurt me too much. |
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We have a fundamentally very different market than we did when gas was $4 a gallon, say the experts. The oil market was pushed up to such extraordinary records by a flood of investors looking to move their cash into commodities as a safe haven from stock market volatility. Furthermore, the U.S. dollar was very weak in the summer months, and that also worked to support the price of oil, and by extension, gasoline prices. But now we have: 12.5% underemployment 2.6 million good jobs lost in 2008 retail purchases are shrinking back to necessities as people live in economic fear. If you are not going to buy, the car just sits did overextended home mortgage people buy all the V8 suvs, and now their gas money goes to the house? |
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