What will happen to oil?

Look'n at the news out of Egypt and think'n that I've been here, seen this before. Somewhere around 79 I think. I seem to recall some bad times at the gas pump, that seemed to coincide with all the riots. We could be look'n at some serious prices around here, it's already over $3 and I don't think I can stand $4+ again. I like my bike but it won't carry the load the F250 will.

Any of you old fa*ts remember what I'm talk'n bout?

2door said:

I see your point as a grower but it still doesn't justify a grocery chain raising the prices on fruit that was on the shelf days before the freeze. I've seen that happen time and time again. Yes, fruit that comes in after the damage will probably cost the grocer more but why increase the price on a product that has already been paid for at pre-freeze prices? That's price gouging, plain and simple.
Tom

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Having been in the business for better than a quarter century as well as running my own business for the last 12 years, I understand the theory behind the "on the shelf price increase". One must always base the retail price on the current replacement cost. That being said, market forces (competition) will often force a retailer to hold the price on pre-increase inventory, even though replacement cost have increased. When we leave the market alone, it usually operates at the lowest possible cost. It's when outside forces, usually political, get involved, things go crazy.

The turmoil in the Middle East will eventually drive oil prices to levels that will kill our economy. Because oil is the one commodity that effects the price of every other commodity on the market, I see inflation coming big time. Couple increasing oil prices and a devaluing dollar and there may not be much in the way of "good times" in our future.

As far as the Middle East is concerned, I have many questions and few answers. America is the bastion of freedom in the world, the "Shining city on the hill", so to speak. We certainly have based our existence on freedom but I fear me may be short on principle and long on hypocrisy. I understand the backing of Mubarak for reasons of regional stability, just like we've backed the Shah, Saddam, the Saudis. But these people, for the most part, have been tyrants that have brutalized their people and now those people hate America. They see us as the enabler of oppression and God help us, they may be right. I just wonder if casting aside ones most cherished principles for the expedience of short term goals, ever ends well.

Please forgive the early morning ramblings of an old fool.

leftywoody said:

I have an old classmate that has worked for Pepsi for 30 years . He told me that they have customers (Grocers) that will order product on a special sale from Pepsi and cover up Pepsi's sale price label with one of their own, marked up . The store makes the normal mark up + the additional increase they choose .

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Absolutely they will and that's perfectly alright. There is no wickedness in charging what the traffic will bear, so long as the market is operating in a free and open manner. Some guy down the street, will price his Pepsi at the sale price because when you come in for the soft drink, you may pickup milk, bread, eggs etc. Many times a retailer will price below the sale price as a "loss leader". You lose money on the Pepsi but make it up on other items.

Then there's WalMart, love'm or hate'm, they're the best at what they do and that's just a fact. They are the king of supply chain management.

oldtimer54 said:

I managed a gas station back then and the gas truck drivers would tell me they wouldn’t let him leave the gas depot until the gas lines got big so they could hike up the prices. And how did the gov respond? They let them do it heck they helped them do it. If this comes down today it will be the same thing. Put a hydrogen generator in your car or truck. The car companies use to say they didn’t work but they are now putting them in the newest cars out there. (If they will work in your model that is). I have gotten as high as 40 miles per gal in my 1981 F150 with my setup. Can wait to try one on a HT motor. Wonder if it will explode?

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The issue with the gas lines was, it was Government mishandling of Foreign Policy that created the situation in the first place. The funny thing is, both parties get to share the blame.

oldtimer54 said:

True but then they manipulated the crises to profit off of it at our expense and you know what they say if you don’t learn from the past your forced to repeat it until you do learn.

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What I've learned is to keep my eyes on our government and watch everything they do. All politicians seem to have a habit of doing what benefits the next election cycle, usually at the detriment to the country.

If left alone, the market does a pretty good job of controlling greed.

oldtimer54 said:

Seems to me from what Ive seen in my line of work the market IS GREED thats how it works and given the opportunity they will always manipulate the market to their gain and our detriment.

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Please expand on "the market IS GREED" and who is "they", not sure I understand.

When I speak of the "market", I'm not referring to Wall Street or pork belly's or the Mom & Pop down the street. The "market" refers to the entire Free Market Capitalist System that the US economy is based on. It really works, it may not be easy but it works. Sam Adams referred to it as "the animated contest of freedom".