I thought it was the oil companies themselves raising the prices, seeing as how they've all been making record profits every damn year.
There's no way around it, if they're making record profits every year, regardless of increased costs/demand/etc., they are gouging us.
Look, you can't make me speak in a logical, coherent, intelligent bananna.Do you want to know a secret about the entire petroleum industry? Their profit margins are nearly nonexistent. By margin they barely outperform grocery stores. (Grocery stores on average make 2 cents on the dollar profit. Petroleum is like 4 cents. Potato chips makes like 40 cents on the dollar profit while soft drinks like Pepsi are even higher.)
Sheer volume on the world market is what makes their big numbers. The whole world runs on petroleum.
Unless it's inflation causing the "records" and people are just running with it to be news.
Fight smart, not fair.Inflation was pathetic in 2008. Never even passed 6%
Petroleum went from 90+ dollars a barrel in January to 147 in July while inflation was comparably pathetic.
Then you had the big ass crash in petroleum as the speculators abandoned ship prior to the election (because both sides candidates were talking about looking into petroleum trading and getting anti-speculation laws in place). By January 2009, inflation hadn't completely crashed but oil did to nearly 30 dollars per barrel.
^^ Profit margin is the entire reason for being in business. Make a poor margin and you could have the highest numbers in the world profit wise and still be run out of business.
Ignorance of that is a big headache in the world of economics. People don't understand or don't care about margins thinking raw numbers is all that matters. Economics does not run on raw numbers.
edited 18th Jan '11 3:28:19 PM by MajorTom
The only thing that bugs me about people complaining about companies making large profits is that these profits tend go to shareholders, especially in older well established industries like petroleum. These shareholders not only include the so-called "evil rich", but also many retirement accounts and pension funds. Thus, anything that takes away from these profits, will — by extension — take away from the retirement funds available to the elderly that depends on them. Other than that, complain away....
Switching hats here: In meatspace, I am a civil engineer who works in the American Transportation Sector. In my experience, there have been many proposals for various high-speed (regional) rail networks. However, none of these have made it pass the early planning stage, due to the ungodly construction costs that would be involved.
Anyway, all this is getting a bit far afield from the OP. On that, all I need to say is, wow, what a bad idea.
edited 18th Jan '11 3:51:44 PM by OscarWildecat
Please spay/neuter your pets. Also, defang your copperheads.@ Tom: How do you explain the price swings in commodities like onions and apples where speculation is banned then?
@ Oscar, but not all the profit does. If a retired person loses 1 cent in pension income, but gas is 10 cents cheaper, they're much better off.
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Depends upon the retiree (i.e. it's a literal case of YMMV). But, the source of the bug in this case is complaints being made without considering the potential for Unintended Consequences. I guess I've dealt with just enough people who complain about corporate profits in this fashion to make it a pet peeve of mine. (On the other hand, I don't have any particular issue with a carefully considered complaint.)
edited 18th Jan '11 4:09:12 PM by OscarWildecat
Please spay/neuter your pets. Also, defang your copperheads.^^ Secondary effects of trading in a linked market. Remember energy prices affect other goods. The price of petroleum goes up (whether by speculation or supply disruption) the price of apples goes up in relation as costs are applied.
Economics is a lot like a jigsaw puzzle. Just because two parts (apples and petroleum) are not connected directly or even on the same part of the board doesn't mean one cannot affect the other.
Let's look at some fairly neutral statistics, rather than just making stuff up.
Some of my favorite bits:
- ...their revenues increased on average by 7.1% in 2007. With output declining, it is likely that revenue growth was based on increasing prices
- Calculating return on revenues dilutes the effect of growing total profits of the oil industry due to higher prices and growing revenues...By this measure (return on equity), the integrated oil companies returned 22.7% in 2007, over twice the return on revenue. The industry leader, Exxon Mobil, earned 33.4%
They like to compare their profit margins to other industrial production
, but they don't even necessarily do well in this zone. Funniest yet is when they compare their margins to the banking industry, which was proven recently to be critically broken (and these profits stem from that broken-ness), or pharmaceuticals (also broken, plus their profits need to be reinvested in high cost R&D.) Add to that the inevitable spin on their statistics and the fact that profit for upper management (increased paychecks, bonuses, or even more hidden things like writing off private purchases as a business expenditure) is obviously not taken account of in the report on company profits, and their numbers start to seem a little flimsy.
edited 18th Jan '11 4:27:56 PM by deathjavu
Look, you can't make me speak in a logical, coherent, intelligent bananna.![]()
To be honest, I don't really see what more we can do with this thread other than say, "Yeah, that was an idiotic statement by Hannity." Do you think it'd be alright if we just turned this into a general "Bad ideas Sean Hannity has" topic?
The US spanned North America from coast to coast by 1850, and that was when the United States was thought of more as a federation of nations than the single state with 50 administrative divisions it is today. Nothing short of nuclear holocaust is going to Balkanize it. But I think our days as world hegemon are numbered. I predict some sort of European bloc, whether the EU of today, or a united European state, or something else, is going to come out of the 21st century energy crisis as the world's leading power (the energy crisis is going to be an utter catastrophe for China. I wouldn't bet on them if I were you).
Also, when the oil supply really starts to contract, everything else is going to get more expensive, not just gasoline. Food will be more expensive, everyday goods will be more expensive, plastics will be a lot more expensive.
edited 18th Jan '11 7:41:46 PM by WoolieWool
Out of Context Theater: Mike K "'Bloody Pussies' cracked me up"I can, atm only think of two historical examples of "Balkanization"
The Holy Roman Empire and...Yugoslavia.
The USSR doesn't count.
Yeah, it'll take a lot more then the end of the oil age to break up the union.
edited 18th Jan '11 11:23:09 PM by CommandoDude
Briefly, "Balkanization" is an actual term, not Buffy Speak, and it's named for the nations of the Balkan peninsula, which broke apart after the Ottoman Empire went down at the end of WWI.
Secondly, I don't see the US Balkanizing any time soon. It was attempted once, after all. Once.
Also, why don't you count the USSR?
edited 19th Jan '11 12:17:19 AM by BlackWolfe
But soft! What rock through yonder window breaks? It is a brick! And Juliet is out cold.

Hate to get away from the gas-wank, but I'd like to point out that what Mr. Hannity is proposing should sound oftly familiar to any students of American History.
Charlie Tunoku is a lover and a fighter.