[PRCo] Re: Inflation

[John Swindler]

>From various sources, I get the impression that there was a higher mark-up 50 years ago.  There was a recent article noting that profit margins are very thin - gas stations are making their profit on the sodas and subs that you buy, so the real trick is to get you into the store.  Paying at the pump helps with costs, but hurts potential revenue.
 
I thought I read somewhere recently that some countries are starting to change their pricing of crude to other currencies???????  Having senior moment trying to recall source.
 
There was also a surprising comment recently that oil from Alaska has been cut in half over the last decade, and that they now have to heat the ground to get it to flow.  Guess that means that Alaska is pass it's peak.  Also going further out into the ocean to drill, and this could cause problems with some 'rule of the sea' being pushed by world government types.  Again, a senior moment trying to recall details.
 
John
 
 
 
> To: trams2 at comcast.net; bbente at bellsouth.net; pittsburgh-railways at dementia.org; alschneider2 at juno.com; philgcraig204 at yahoo.com; jdeshlemanmd at aol.com> From: fwschneider at comcast.net> Subject: [PRCo] Inflation> Date: Sat, 5 Apr 2008 15:56:05 -0400> > In the Shuman slides I came across a color slide of a Pittsburgh > Railways route 60 trolley car passing a gasoline station in Homestead > in 1958, almost 50 years ago. The price at the pump for regular was > 29.9. If we work with the idea that inflation normally moves the > decimal one place in fifty years, that would jack it up to $2.99 > 9/10s today. Add a little more for the added costs of unleaded and > perhaps $3.10 or $3.20 is reasonable ... we're right in the ball > park, aren't we? (Understand that I'm not even considering using > the consumer price index in my thought process because it is adjusted > to consumption and doesn't reflect raw inflation.)> > But very little of the liquid fossil fuels we burn are pumped out of > the ground in the U. S. What stuns me is that we are buying foreign > oil in dollars and the U. S. dollar has gone to hell in a hand basket > thanks to our borrowing to run our government, borrowing to give tax > refunds, the collapse of our mortgage market, etc. It is worth > about 59% of what it was against the Euro just ten years ago. We've > lost about 20% against the Canadian dollar in the last year and they > are the largest source of oil in North America.> > The independent truckers want to strike because the price of fuel is > up but all I can see is something far less than normal inflation. > If we adjust that inflation to the loss in the value of the dollar, > then our gallon of gasoline should be somewhere between $3.84 and > $5.12 a gallon depending on where we buy the crude oil and No. 2 > diesel, which is taxed to a greater degree, should be about 25 cents > a gallon more.> > Somebody want to tell me what I'm not seeing? Was there a lot of > markup in the price of fuel 50 years ago that isn't there today? > Have the oil company's sacrificed investment to keep the price at the > pump low?> > fws> 
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