Comments on: Real Impact of Gas Prices on Economy?

By: Justin Trescott

Justin Trescott — Wed, 25 Jun 2008 20:53:42 +0000

I’ve been toiling over quite sometime about what to do with these ridiculous fuel price spikes which seem to take place every week or even daily now. I can’t sell my car, since it’s how I make my living, so I took a chance and purchased a water kit for my car online from Water4Fuel.info

My mpg’s have gone from 26mpg up to 39mpg and it took me about 45 minutes to install it in my car. So far, so good…I’m only visiting the gas station two times per month now!

By: John Pring

John Pring — Mon, 23 Jun 2008 16:58:24 +0000

Your math is accurate for the given situation, but I doubt if your example is truly representative. From my personal experience, which represents two adult drivers and a teenage driver in the family, my monthy gasoline budget has been severely busted. My wife drives approximately 500 miles per week, I do approximately 350 miles and the teenager does 50 miles. These are work related miles … not pleasure driving. The only positive is that my car averages 28 mpg, the wife’s averages 24 mpg and the teen’s is well over 30 mpg.

All in all, the current price of fuel has hammered my discretionary budget. Considerably less “going out” for meals, etc. When I do go, I see the establishments are noteably less crowed.

By: Eddie Strickland

Eddie Strickland — Mon, 23 Jun 2008 15:19:23 +0000

Not only is your math way off, your leaving out the domino effect that anything negative on the economy has. Most people are driving in the city which means even the small economy size car that we all wish we had now will still only get roughly 20 miles to the gallon. If you multiply that by not 12,000 a year but by a more realistic average of 15,000 a year you will see that we are spending around 210.00 more a month {per vehicle}. Now you figure in all the other rising costs in our economy and you will quickly come to the same conclusion that millions of Americans have come to. NO MORE EXTRA MONEY FOR DINING, OR ENTERTAINMENT. And it is here where we really take the biggest blow, now we see businesses closing and more and more jobs are lost and thus contributing even more to our weakening economy.

By: mark zly

mark zly — Mon, 23 Jun 2008 13:34:08 +0000

Sir

Your numbers are “WAY OFF”. That’s what the media doesnt understand. Your numbers?
Double that….Most families use 2 cars because there is 2 incomes so double that.
Now ur getting a more accurater picture. 75% of the country cant used public
transportation. Where have you people been?

By: frederick gorayeb

frederick gorayeb — Fri, 20 Jun 2008 23:51:16 +0000

The problem I see with your “math” is assuming 25 mpg. More than half the population are driving large suv’s and pickups. These vehicles get around 12 mpg city, wich where I live is the only type of driving possible because of heavy traffic. A person driving 16000 miles per year getting 12 mpg would spend an additional $233.00 per month at $4.20 per gallon compared to $2.10.

By: Chiefos McStacy

Chiefos McStacy — Fri, 20 Jun 2008 21:51:21 +0000

Mr Sullivan,
Your most obvious point is simply that the differential in what we are spending in gas now versus what we were spending last year is marginal. It is not the actual dollars spent that is the real problem, it is the psychological effect created by seeing $4 a gallon on every street corner and at every exit. Constant reminders of this situation make the average person tense up and spend less. If we were not in a consumer based economy this would not be that big of a deal, however we are and everyone needs to understand that this is just how it is going to be. Budget yourselves wisely and also use a little common sense conservation and we all will adjust.

Great Blog by the way, I’m a big fan!
Chiefos McStacy

By: Mark

Mark — Fri, 20 Jun 2008 18:22:33 +0000

My wife and I have had this conversation for over a year now about how high will gas prices need to get before the american consumer gets fed up with the environmentalists and tells them to take a hike and we begin drilling everywhere we can find oil, we begin building more refineries, and nuclear power plants. The common answer was probably over $4.00 per gallon. I am still amazed at how many people still believe that drilling is NOT a good idea and that we need to continue paying people who don’t like us for a product we so desparately need. I also wonder how long it will be before we begin giving insentives to develop hydrogen fuel-cell cars. My theory is that when not if we develop a vehicle that will run on hydrogen and get off the oil, what will the arabs do with all of that oil because you can’t eat it and if there is no need for it, what are they going to do. They can’t grow anything over there either. Just a thought.

By: paul

paul — Fri, 20 Jun 2008 17:32:20 +0000

Drill for more oil? We export most of the oil we produce now. Do the jokers in washington have a deal with the oil companys to make even more money? Why dont they stop the export of oil in this country.If we take the free food,transpotation,haircuts,healthcare,ect away from are so called friends in washington,they can see 1st hand what it is like to live on a budget!!

By: Marsh

Marsh — Fri, 20 Jun 2008 17:24:21 +0000

I read this as an elitist commentary.
There are obviously some missing details.

All demand does not come from the USA! Gasp!! Workers in India and China are experiencing a middle class life and want the things we associate with the change in lifestyle. Look at pictures and films of large cities today and compare them with pictures from a decade ago. A significant increase in cars.

We are dependent on a group of not very friendly foreign governments for our supplies.
Why is it acceptable to blame the oil companies who do not produce all of the oil consumed for their 8.7% profit margins and not blame the hedge funds and their 82% profit margins made partially by purchasing gas futures? Oh I forgot Al Gore owns one.

Why do we not want to be independent of foreign control and keep our dollars in this country? We could significantly increase charitable activities without an increase in taxes.

We experienced the effects of higher taxes and rationing in the era of President Carter. We need a comprehensive energy policy. One where everyone’s ox is gored a little. We have been NIMBY’s for far too long. It seems that the risk of poisoning people, birds and animals in other countries is perfectly acceptable as long as we don’t have to see or experience it. Talk about the ugly American.

And finally we have our politicians pandering to as many groups as possible to maintain their elite position with absolutely no understanding of the interaction between energy, food, manufacturing and the movement of goods to market.

It is evident that a failure to learn from past mistakes dooms us to repeat them on a much larger scale.

Freedom, self reliance and personal responsibility should be the watchwords for the American public!!

By: Edwin

Edwin — Thu, 19 Jun 2008 22:29:48 +0000

“I know somewhere Fox Business’ Dave Ramsey is squirming, as he smartly advocates having no credit cards and thus paying zero per month in interest.”

Good old Dave neglects to take into account the 1% to 6% or more that I’m saving by using a credit card. My expenses would be higher without them. Also, with no credit cards, it’s pretty difficult to get a good rate on a mortgage, so your mortgage payment will be higher, if you can even get a house, and if you have any unforeseen difficulties, credit cards can be a life saver.