gas prices

[Eze]

well how high this time. will it bring the the country into a recession again?

[Okotokian]

well how high this time. will it bring the the country into a recession again?

Again? They didn't bring the country into recession last time. Bad mortgages and government spending did. Last time prices were really high Alberta was rockin' and we were buying RVs to beat the band!

[eastcoast]

well how high this time. will it bring the the country into a recession again?

with the instability in the middle east right now I would fill up as soon as possible,the price of oil went up over $5 today alone, in a few days gas will go up and probably by more than a little bit.

[BallCoeff.435]

well how high this time. will it bring the the country into a recession again?

Country's never been out of recession; since the dot-com crash. Artificially low interest rates and the government pumping your future tax dollars into the banks have caused a house price explosion and way too much living off credit.

Most people have been living off debt since the dot-com crash. HELOC's, charge cards, car loans, mortgages, student loans. Now we're all set up for helluva crash because of all the debt, and because house prices are finally falling down to normal, and speculators are inflating food and energy prices. But it's tough to find any job outside of north east Alberta, and those who are working don't get anywhere near the salary increase that would have to justify all that debt.

Higher gasoline/diesel prices are just an irritating sideshow, or another straw on the camel's back.

[SonnyJ]

Higher gasoline/diesel prices are just an irritating sideshow, or another straw on the camel's back.


And for those who have shares in oil companies this is good news.

[blackpheasant]

Better get used to it, the days of cheap oil are long gone....:)

[eastcoast]

I filled up last night, with $5 spikes in the price of oil in 1 day it won't be more than a few days before gas and diesel go up.

[great white whaler]

By this summers end , there well be no problem to fine a good deal on big trucks ' RVs and any other toy'''hard to under stand why we pay so much for gas ,with all the oil and gas in alberta ' why do we even need to go abroad ? What happened in Egypt ' could very well happen in canada .

[Beerfish]

We should be just cackling with glee as a province every time the price of barrel for oil jumps and gas prices rise because in 'theory' the huge increase in revenue to the province would easily off set the inconvenience of higher gas prices. Too bad that isn't the case.

[spinerfisher]

Already started. Some stations in calgary now 109.9

[SonnyJ]

And at what price will you STOP buying gas?

Yeah that's what I thought..

[madatter]

We should be just cackling with glee as a province every time the price of barrel for oil jumps and gas prices rise because in 'theory' the huge increase in revenue to the province would easily off set the inconvenience of higher gas prices. Too bad that isn't the case.

Too bad that our leaders will find some way for that extra revenue to be wasted...disappear:thinking-006:
Maybe they will give themselves a raise.....cause it was part of their plan....right?:sHa_sarcasticlol:

[AxeMan]

And for those who have shares in oil companies this is good news.

Wooo Hooo.....:sHa_shakeshout:

Bought in heavy about a month ago.

[hunter10]

She's a buck twenty two here in toronto this week

[HunterDave]

And for those who have shares in oil companies this is good news.

100% invested in oil. It's been a good week $$$ on paperwise. :47b20s0: I have to fill up my truck this afternoon though. :2mo5pow:

Middle East unrest = Higher oil = Bad for a struggling economy trying to come out of a recession. Maybe the analysts were right when they predicted a double dip recession! Batten down the hatches we might be in for a stormy ride! :scared:

[rugatika]

you think gas has gone up. Look at cotton prices, sugar, coffee, everything is going up, up, up. I'm going to buy a whellbarrow to haul the money to buy a loaf of bread. Hello inflation/stagflation.

[Sledhead71]

you think gas has gone up. Look at cotton prices, sugar, coffee, everything is going up, up, up. I'm going to buy a whellbarrow to haul the money to buy a loaf of bread. Hello inflation/stagflation.

More like Hyper Inflation, something we should all be worried about......

[Okotokian]

More like Hyper Inflation, something we should all be worried about......

You should worry more about a comet hitting Calgary.

[Lonnie]

By this summers end , there well be no problem to fine a good deal on big trucks ' RVs and any other toy'''hard to under stand why we pay so much for gas ,with all the oil and gas in alberta ' why do we even need to go abroad ? What happened in Egypt ' could very well happen in canada .

gas& oil is still cheap if you take off all the taxes as for the Egypt thing never happen in Canada we are to passive.

[rugatika]

You should worry more about a comet hitting Calgary.

Why do you say that?

[Okotokian]

Why do you say that?

Well, what conditions are usually in place which have caused hyper-inflation in history? Which of them are currently in place in Canada now?

When was the last bout of hyper-inflation in Canada (like 30% a year or more)?

Seems to me the Bank of Canada has been pretty vigilant about monitoring for inflation and adjusting the bank rate accordingly.

I just don't see it happening.

[rugatika]

who is Canada's biggest trading partner???

I could envision a scenario where the american dollar loses all credibility and as a result spins off to a loss of faith in a country whose whole economy is to a large extent dependent on the American one.

Not sure how likely it is...but I would prepare for hyper inflation before i worried about a comet.

The bank of canada can pull elephants out of their butt, but in the grand scheme of things they are irrelevant if we lose 85% of our economy.

Not really something I'm really worried about...but I'd say it's in my peripheral vision

[great white whaler]

? .Why is it 'the americans pay about half as much as canadians for gasoline 'and every other god dam thing we buy.:mad3:

[Okotokian]

who is Canada's biggest trading partner???



Then I guess I'd restate my same questions with regard to the U.S. I think we both agree though, we just look at it from different perspectives.... COULD it happen? Concievably. Anything COULD happen. Is it likely or is there even a relatively small chance of it happening? No.

Ruga, you are just a glass half empty guy and I'm a half full guy ;) LOL :)

[Nomad]

Wooo Hooo.....:sHa_shakeshout:

Bought in heavy about a month ago.

Man that was good timing. I usually do the opposite.:mad0030: I boil oil for a living and I know we could be making more gas right now but we aren't. We get our orders from a secretive group tucked away in a far off bunker so not much we can do about it. It's going to get worse.

[Nomad]

? .Why is it 'the americans pay about half as much as canadians for gasoline 'and every other god dam thing we buy.:mad3:

Taxes for socialism.

[BlackHeart]

Again? They didn't bring the country into recession last time. Bad mortgages and government spending did. Last time prices were really high Alberta was rockin' and we were buying RVs to beat the band!

This is going to be another cause/effect discussion......

Your look and take of the sub-prime mortgages being the cause is taking one (the biggest) piece in the line of cause and effect and labelling it the main cause to the end result......misses the subtle interplay of what the whole chain of reactions were.

So here goes an abreviated view......energy is needed for everything in life even making love.....that energy must come from food which comes from the burning of oil for the tractor.....go back further and all earths energy originates from the sun.....either its rays or its gravitation effect........our most available source of concentrated energy is hydocarbons.........the increase demand/price of those ripples through every single aspect of our lives.......therefore and increase in the price of that energy creates the same ripples.........the burp at the end is a recession and decrease of demand for that energy........sub prime is in the middle of that process.


An abreviated version.
1) oil hit $140
2) trucks, RV, boats, demand drops
2b) airline tickets, food prices, everything price increases
2c) cost of living-heating house, getting to work, etc increases=less disposable income
3) demand for items starts dropping off resulting in loss of jobs
4) loss of your neighbors job scares people and they start tightening the belt
5) demand further drops off resulting in more job losses
6) home prices start falling
7) enter the sub-prime problem -no job and no home price gain
resulting in banks tightening up due to losses, insurance companies forcing everyone to tighten up, inventories shrinking which causes retailers to loose opportunities and tighten up.
8) further job losses and companies no longer being able to finance operations

and thing just keep getting worse until the bottom hits and bargin hunters start buying up assets.

So while high oil prices are good for Alberta it can be dangerous globally and financially.......one of the factors that has kept this from dampening the markets is that the alternative to oil, gas has been at historic lows......plus even though the speculation on oil always happens during middle east tensions, most expect some lessening of prices once the tumoil is past, so the markets have not tucked their tail yet.......but if the situation of price with no alternative was driven by demand the jitters in the market might start to show up.

[BlackHeart]

who is Canada's biggest trading partner???

I could envision a scenario where the american dollar loses all credibility and as a result spins off to a loss of faith in a country whose whole economy is to a large extent dependent on the American one.

Not sure how likely it is...but I would prepare for hyper inflation before i worried about a comet.

The bank of canada can pull elephants out of their butt, but in the grand scheme of things they are irrelevant if we lose 85% of our economy.

Not really something I'm really worried about...but I'd say it's in my peripheral vision


Hyper inflation happens when two things occur....the printing presses print money like toilet paper and no trading partner wants to take your currency.

Most worry about hyperinfation due to the US assuming and increasing its huge debt, but debt has not been any indication of a countries direction in regards to the value of its currency.......add to this the fact that the US dollar is considered the world's reserve currency.....add to this the massive amout of US dollars China holds in reserve.......and the amount of investments it has made in US companies.....and the amount of US debt that it owns in US nominations (China does not want to be paid back in zimbabwae like dollars).....and the cost of borrowing that would suddenly cripple the US and most economies and households..........and the conclusion is that hyperinflation is highly unlikely.....almost couldn't be conceived of without sending the world into a situation that would make the 30's depression look like a nice sunday picnic.

Now why do I keep mentioning China.....because of any nation right now it probably has the most ability to impact the US dollar......can any European country....no they have their own troubles with debt and socialism....and as a example the euro is still strong....but there is pressure to devalue it to improve exports and economic activity.

Also keep in mind that causing hyperinflation by devaluing your currency also jacks up your debt maintenance costs and once your on that downward spiral its very difficult to get out of making your currency and economy worthless......why would the US want to increase their interest costs?

[Fixall7]

I'm from Montreal and fuel is going up to 133.4/L tonight ,I think its time to pull out those Bennett Buggies .

[Okotokian]

An abreviated version.
1) oil hit $140
2) trucks, RV, boats, demand drops
2b) airline tickets, food prices, everything price increases
2c) cost of living-heating house, getting to work, etc increases=less disposable income
3) demand for items starts dropping off resulting in loss of jobs
4) loss of your neighbors job scares people and they start tightening the belt
5) demand further drops off resulting in more job losses
6) home prices start falling
7) enter the sub-prime problem -no job and no home price gain
resulting in banks tightening up due to losses, insurance companies forcing everyone to tighten up, inventories shrinking which causes retailers to loose opportunities and tighten up.
8) further job losses and companies no longer being able to finance operations



Ah, but you CHOSE to put oil prices first in the chain of events. But it's all where you choose to slice the cycle. What caused high prices? It wasn't that oil executives said "Hey, let's raise prices!". Look at the causes. Increased speculation. Why? Increased and emerging demand. Why?

Also, you claim high oil prices led to high overall prices, inflation, which led to less disposible income, which led to less demand, which led to an economic slow-down. Problem is though, none of that happened. Inflation in the U.S. for 2008 was 3.85%. 2007: 2.85% 2006: 3.24% 2005:3.39%. There was no large upswing in inflation. That wasn't at all the cause of the recession. Banking practices were so poor that there was no cushion for even the smallest numbers of defaults that normally occur in a business cycle. It was because the US bankig system was allowed to become a house of cards, not because oil prices were high.

And remember, we are Canadians. We are net exporters... and we did very well when the prices were last high.

[BlackHeart]

Ah, but you CHOSE to put oil prices first in the chain of events. But it's all where you choose to slice the cycle. What caused high prices? It wasn't that oil executives said "Hey, let's raise prices!". Look at the causes. Increased speculation. Why? Increased and emerging demand. Why?

Also, you claim high oil prices led to high overall prices, inflation, which led to less disposible income, which led to less demand, which led to an economic slow-down. Problem is though, none of that happened. Inflation in the U.S. for 2008 was 3.85%. 2007: 2.85% 2006: 3.24% 2005:3.39%. There was no large upswing in inflation. That wasn't at all the cause of the recession. Banking practices were so poor that there was no cushion for even the smallest numbers of defaults that normally occur in a business cycle. It was because the US bankig system was allowed to become a house of cards, not because oil prices were high.

And remember, we are Canadians. We are net exporters... and we did very well when the prices were last high.

Your right, I did slice it off at the higher oil prices.....but that was the bottle neck / consolidation of numerous factors at work such as increased demand due to an overheated economy that had people buyin like no tommorrow, increasing their debts, china's growing demand internally and for the export related production, speculation, etc, etc,......many things contributed to the increase in oil prices and each one pushed it a little further up........but it was the price of oil that could be seen as the trigger to the next series of events......the first words of the impact that we heard in canada was of the truck plants in ontario shuting down due to demand plummeting....that was the sign we all should have paid attention to.

Which comes first speculation or forecasted demand.....I can't tell. As for the emerging demand....well I would say that is a result of China and India trying to move from third world living standards towards our living standards.

The effect of a high oil price never really got to see the light of day as things didn't fall like dominos but more like a house of cards......and your right one of the pilliar of this shaky house was the sub-prime mortgages......but they did not burst on their own and without something causing them to.....otherwise all of these low income realestate speculators would have flipped or kept meeting their payments and the banks would have been fine.

Don't get me wrong, the sub-prime issue amplified the situation greatly and turned the situation from a down turn/ adjustment to a major headache.....but it did not precipitate the issue.....just a bunch of common workers getting caught up in trying to live the dream. You have to remember that mortgage defaults are usually caused not by themselves but by the economic factors' impacts to the home owners.....and now you have to ask what were the economic factors that did the owners in.

As to inflation.....yes it was just starting to creep in and would have been much higher...remember the mexican corn price issue-ethanol right-no-enviro policy-not quite-energy demand and cost-yes (skip this one its too distracting).....then again the measure of inflation is not that great a measurement as it use the basket of goods concept that can't truly capture what is going on and it has other faults ......best way to explain my thought is......does it measure the cost of gas, yes...does it measure the cost of a vehicle, yes.....does it measure that as prices go up consumer demands switch from the truck to the car, NO, does it measure the switch from the car buying to keeping the used one, NO, does it measure the switch from a resort to local vacation,NO.......does it measure any change in demand, NO.

So while inflation is a item to keep an eye on, it is more a measure of an economy as it steams on......not on the change in demand patten that are happening.......and that is what happened with oil price impacts.

Look at airlines, oil goes up, less people can afford a vacation after putting gas in the car, prices try to creep up but this just further suppresses demand, therefore price stay the same but fuel cost have gone up....somethings gotta give and that means cost cutting by reducing staffing level... so no inflation directly.

Alberta due to its oil exports did not feel much pain at all in compare to anywhere else in the world, never mind the US or Canada. I don't disagree that we do well when oil is high....but we did see the housing inflation due to it.....what was the inflation index saying for alberta at the time???....funny thing that index....govt controlled and collected by a bunch of govt staff from their govt reports and forms.

Now as to the shaky banking practices in the US....YES.....one of the bigger cards as well.......but it doesn't fall without something blowing.....but it sure helped make thing a whole lot worse....and spread the impact onward.

[Okotokian]

LOL Well, I guess part of the issue is also that I'm biased. I live in Alberta, work in the energy industry, and have a son who is just graduating university and looking for a job as a geologist. We could use a little boom. More cash in the provincial coffers doesn't hurt my wife the teacher either. ;)

[rugatika]

Hyper inflation happens when two things occur....the printing presses print money like toilet paper and no trading partner wants to take your currency.

Most worry about hyperinfation due to the US assuming and increasing its huge debt, but debt has not been any indication of a countries direction in regards to the value of its currency.......add to this the fact that the US dollar is considered the world's reserve currency.....add to this the massive amout of US dollars China holds in reserve.......and the amount of investments it has made in US companies.....and the amount of US debt that it owns in US nominations (China does not want to be paid back in zimbabwae like dollars).....and the cost of borrowing that would suddenly cripple the US and most economies and households..........and the conclusion is that hyperinflation is highly unlikely.....almost couldn't be conceived of without sending the world into a situation that would make the 30's depression look like a nice sunday picnic.

Now why do I keep mentioning China.....because of any nation right now it probably has the most ability to impact the US dollar......can any European country....no they have their own troubles with debt and socialism....and as a example the euro is still strong....but there is pressure to devalue it to improve exports and economic activity.

Also keep in mind that causing hyperinflation by devaluing your currency also jacks up your debt maintenance costs and once your on that downward spiral its very difficult to get out of making your currency and economy worthless......why would the US want to increase their interest costs?

I agree with you, but what gives me some small measure of concern is China's recent suggestion of moving away from the American dollar as the international currency of trade. I realize they still hold a huge amount of American debt, and there is an interest worldwide to keep the USD from tanking. But, man it sure seems like Obama is intent on doing what he can to collapse the dollar. Like I said, I'm not too concerned about hyperinflation, and I wouldn't bet any significant amount of money that it was going to for sure happen, BUT, I don't think it is as far-fetched as some make it out to be.

http://www.digitaljournal.com/article/277904

http://mises.org/daily/4016

http://mises.org/daily/5061/Inflation-Is-Here-and-It-Is-Going-to-Get-Worse

http://www.youtube.com/watch?v=wbkoy2w3wm4&feature=related

http://www.youtube.com/watch?v=loa92ZG1KV8&feature=related


http://www.youtube.com/watch?v=dXBpIh_8_Bk&feature=related

And for all the Glenn Beck Fans I know are on here I dug these up:
http://www.youtube.com/watch?v=dlHBYQrCnIk
http://www.youtube.com/watch?v=xgrOZbOWjUU&feature=related



Take Schiff et al with a grain of salt, I don't think he has a crystal ball, but just to say there are some people with experience in the markets and economics that feel it is more likely to happen than getting hit by a comet.

[BlackHeart]

Rugatika....thanks for all the light reading links :):)

I am taking a break and will get back to this issue ( and the links) after supper.

My preliminary thought/comment on the Chinese devaluing the dollar or such....

I am sure China is shifting some of their reserves to the Euro.....but thats a tough one for them to accept as there is very strong pressure to devalue the euro to get their economies working and their debts down so they can afford the socialism they love....they don't get it....oh well...but maybe they will learn the hard way....more for diversification of risk.

The other thing they can do is buy gold.....is that why the price is still so high in light of a crash and recovery.......I'll dig in to this thought a bit more as well......but do the Chinese want to buy gold at 1300 and sell at 600....so thats not a safe storage of the wealth they have earned.

Take out the US economy and you take out the Chinese economy as well.....unless their internal demand can replace US demand.........and they have bought enought resource companies out there to ensure they get the raw goods they need.......doesn't seem even remotely likely with 2billion people.

As to Obamas plans.....first black president destroys US economy and dollar.....not likely. Is it the final decaying momments of a great empire like the collapse of the roman empire......fantasy and wishful thinking.......besides the deline of the roman empire took more than a few centuries.....and the last time I heard this idea from an economic professor about the rise of Japan, I could not beleive that a little island with no resourse or creativity was going to oust the US as the global economic power house.......rule of thumb is.....don't bet against the current champ, hes still there for a reason.

[rugatika]

Rugatika....thanks for all the light reading links :):)

I am taking a break and will get back to this issue ( and the links) after supper.

My preliminary thought/comment on the Chinese devaluing the dollar or such....

I am sure China is shifting some of their reserves to the Euro.....but thats a tough one for them to accept as there is very strong pressure to devalue the euro to get their economies working and their debts down so they can afford the socialism they love....they don't get it....oh well...but maybe they will learn the hard way....more for diversification of risk.

The other thing they can do is buy gold.....is that why the price is still so high in light of a crash and recovery.......I'll dig in to this thought a bit more as well......but do the Chinese want to buy gold at 1300 and sell at 600....so thats not a safe storage of the wealth they have earned.

Take out the US economy and you take out the Chinese economy as well.....unless their internal demand can replace US demand.........and they have bought enought resource companies out there to ensure they get the raw goods they need.......doesn't seem even remotely likely with 2billion people.

As to Obamas plans.....first black president destroys US economy and dollar.....not likely. Is it the final decaying momments of a great empire like the collapse of the roman empire......fantasy and wishful thinking.......besides the deline of the roman empire took more than a few centuries.....and the last time I heard this idea from an economic professor about the rise of Japan, I could not beleive that a little island with no resourse or creativity was going to oust the US as the global economic power house.......rule of thumb is.....don't bet against the current champ, hes still there for a reason.

Well one of the points Beck makes is that the Banks are still holding onto a lot of the money and are delaying the inflation. I agree with you that there are many shall we say extrinsic reasons for the American dollar to be defying logical factors and holding on as the base currency, whether these extrinsic reasons are enough to maintain the status quo...only time will tell.

My point being that, I wouldn't absolutely count out hyperinflation (or heavy inflation, however you define hyperinflation...I think 20% a yr or month or something). Logically it should be coming, but as you point out the American dollar has many things going for it that may help it ride out logic.

[ccmckee]

Anyone notice how it always seems to be good ole Petrocan that raises the price first? They were up to $1.12 this morning and the others were still running $1.04 to $1.08.

[Beerfish]

Too bad that our leaders will find some way for that extra revenue to be wasted...disappear:thinking-006:
Maybe they will give themselves a raise.....cause it was part of their plan....right?:sHa_sarcasticlol:

They'll do what the people ask them to do, which essentially is what the Alberta conservatives have done. Give breaks to the oil companies, don't raise taxes, keep spending money to stimulate the economy. All of that leads to a deficit. when it comes to to pay to face the deficit people are all over the government for doing essentially what people wanted them to do.

[BlackHeart]

Rugatika:

The first one with Peter Schiff.....well he did seem to nail the sub-prime, stay away from banks, gold over 1000.....hmmm....pretty good forecasting and he was not afraid to tell everyone that its not all rosy ahead.

I am of the belief that to have the US dollar crash would cause the world pain to be felt just as much...so the crash of it would be prevented...or

As might be happenning.......the slow behind the scenes movement away from it to the only historical currency that remains...gold...and other stores of wealth, mainly hard assets. Would explain the cnd dollars strength against the US, due to our oil energy stores.

Would countries like China be planning that far ahead with the idea of taking out the current consumer and collector of wealth in order to replace it themselves. Would the arab world and the wealtht they have been accumulated think it prime time to strike a death blow to the US economy??? Lot of conspiracy theories out there to sort through for the truth.

The US has used the devaluation of their currency to worthlessness before to pay off large debts....JP Morgan got his banking empire through that process.

Is the precious metals prices inflated and manipulated the same as the junk bonds, energy/enron, dotcoms, banks and investment houses and all the other bubbles that have occurred in the last 10years.??


So what is the truth and the answer. Ten years from now things could be very scary out there. Lot of us would hate to have the wealth we have worked 30years to accumulate be wiped out by some global manipulation.

[Fisherpeak]

119.9 here today,up 4 cents from yesterday.

[HunterDave]

119.9 here today,up 4 cents from yesterday.

OUCH! It's $1.05 in Morinville right now, up $.04 from yesterday. The funny thing is that it was $1.10 yesterday 20 kms down the road in the city. Typically, Morinville keeps the prices down until the cheap gas is gone from their tanks and they have to buy the more expensive stuff to replenish. What a novel idea. :cool:

[Okotokian]

119.9 here today,up 4 cents from yesterday.

:47b20s0::acigar:

[eastcoast]

Anyone notice how it always seems to be good ole Petrocan that raises the price first? They were up to $1.12 this morning and the others were still running $1.04 to $1.08.

it has always been that way,petro can sets the price and the others follow.

[Ken07AOVette]

Canadian Tire Lloydminster 2:00 today 109.9, most other places 102.9, superstore .979. There were HUGE lineups there. Doesn't make sense to me to sit and idle for half an hour to save 100 on a half tank top up. :scared:

[HunterDave]

Canadian Tire Lloydminster 2:00 today 109.9, most other places 102.9, superstore .979. There were HUGE lineups there. Doesn't make sense to me to sit and idle for half an hour to save 100 on a half tank top up. :scared:

I gassed up yesterday at Shell in Edmonton and they told me that their tanks were almost dry. People start hoarding gas (ie. jerry cans, tidy tanks, etc) resulting in a shortage and higher gas prices. It's like a self-fulfilling prophecy!