I'm sorry, but doesn't the government artificially EXPAND access to oil? I mean, with things like liability caps, doesn't it take away much of the risk in drilling for oil in places like the Gulf?
@cdriggs NO. Gas prices go up, things that transported shorter distances or grown close to home get cheaper comparatively, we buy more stuff from our neighbors instead of China. REMEMBER your gas prices are already higher than you think. Gas prices are something like 6 dollars per gallon with all the hidden subsidies in place. Since subsidies are debt, our current system makes you rob your children of their future income to buy your gas today. How do you know so much about the effects of crack?
1. So: supply of oil is not yet a critical factor.. and..
2. interesting way to look at it.. so.. the low gas prices we have now was actually an indicator of considerably lower production, with the global economic crisis?
Actually, increased transportation gas prices represent only a single percentage point or so of final sales price, so your thesis I'm afraid is not correct... :)
Aren't China and India able to build cheaper laptops because their labour is paid and treated literally like slaves, especially compared to Western labour?
Stef, I have watched many of your videos and think you are highly intelligent. What would be your response to the argument that the Fed is pumping money into the market to avert a collapse and this is devaluing the dollar? It is not that prices are going up, but rather the purchasing power of the dollar is declining.
Pension funds grow daily, and companies still have to employ their capital. They have to invest *somewhere*. The thing is, there is NOWHERE they can invest to avoid the "rising tide" of inflation due to higher energy costs. So they invest in the same places as before, that have the differential price advantage: China, and India. So, life goes on, much as before, except now the transfer of wealth from consumers to oil execs has stepped up a notch
peperpnch: Supply and demand are factors, as is peak oil. But supply hasn't halved and demand hasn't doubled, in the last year. What HAS changed is the amount of USD in the world. The Fed has been flooding the world with USD. M3 money supply is currently running at 17%! Those new dollars are all competing for the same commodities, driving ALL prices up: oil, wheat, rice, etc. There is no "food shortage", either. The dollars have been devalued, so it takes more to buy the same amount of commodity
During a recent trip to the Middle East, Bush called for OPEC to increase oil production. He was trying to create the perception that he cares. OPEC rejected the call, saying that production is meeting demand, so there's no point in lifting production rates. That's an operational matter, and can be easily falsified, if not true. No-one has.
Bush's call for increased production was a facile attempt to blame OPEC. The MAIN problem is the FED debasing the USD, making ALL commodities more expensive
things getting cheaper?! does the fact that basically all consumer goods are transported using oil? the high costs raise shipping costs, and who do you think takes the hit on that? investors...of course not, it's the consumers, so where is the net gain in that?
right so if cost goes up then so does price, even if it is on a small scale like in China and India, there are so many steps between the Factory in China and your house. Planes, ships, warehouses, road transportation. To cover the rising oil costs in these steps and keep profits up, consumer prices go up.
I don't know if this guy's a trader, an oil company spokesman, or just naive - BUT I'VE NEVER SEEN SO MUCH BULLSHIT IN 1 VIDEO.
1st - his premise that we have a "free market" is off-base.
We have an over-supply at this time (Oil Execs have admitted as much) & yet prices increase.
I live close to some Houston Oil Execs & massive amts of money have been transferred from the lower & middle classes to them! WHAT I SEE IS DISGRACEFUL & some get off-shore accts & dont even pay tax on int.
Agreed. It's very difficult to disentangle things, but fiat money, limitations on where oil firms can drill, government subsidies to "clean energy" etc. all impact the price of oil. Oil firms have little reason to expand supply anymore, as if a move away from oil is completed, it'll be a waste of cash.
steph, i dunno how many ppl can say this, but i have seen every video & listened to every podcast you have. and i agree with you 99.9% of the time. but i think you are way way off here. in your example a $200 price savings on laptops would not be nearly enough in saving vs the mass # of consumers paying the high price. also, it doesnt make shipping cheaper, look at reality & food prices. for real, reality doesnt back you up in this instance, maybe im wrong, but i dont think so.
No, I'm saying that in macro-economics a lot of effects do not filter down for quite some time. The Fed has been flooding the world with USD, trying to prop up an unsustainable financial system. They are delaying the effect, but are making the ultimate collapse worse. The extra dollars flow through Wall Street, then to producers, then to consumers, as dollar debasement/price inflation - a process that can take up to 18 months. So people are making buying decisions *now* based largely on old news
Not to mention the higher energy prices will spur development of high technology alternatives to oil which will be primarily centered in western developed nations.
Your next video should be how to love getting kicked in the nuts... I disagree with you that gas is going up because of India and China. The reason gas is going up is the same reason why Gold, grain and other commodities are going up. The debasement of the dollar to pay for the welfare/warfare state. I don't know why I should be happy about the Empire robbing me blind. India and China only play a small part in the commodity boom the real reason is the Fed's overprinting the money supply.
Even if a manufacturer could produce the laptop cheaper, transport costs and general inflation (due to USD debasement) are the tide lifting ALL boats, be it India, China, England, US, etc. EVERYTHING gets more expensive with higher gas prices. The fact that people have continued to purchase laptops is a factor of market inertia. The effects of capitalism are not instantaneously reflective. Spending areas are being prioritized, and some sacrificed. Laptops not *yet*
I know what the hell is Stef thinking saying this B.S it sounds like the bullshit they spout off on CNBC and other bubblevision channels. Pretty soon Stef will get on here and start saying "the economy is Goldilox" like that dumb ass kudlow was saying right up and through the housing bust.
Yes but that doesn't argue *against* Stef's points about consumption etc. Both of these forces are at work, the FED debasement of the dollar *and* foreign competition for oil. They go 'hand in hand' - it's not as black and white as people think.
and whistle while you pump, because the tires and tubes are made from petrolium and since they will get expensive (together with the lubeoil, and well, pretty much most of the other parts) you will use more tubes/bikes/year/price
so whistle while you pump; it lowers the blood pressure...
I'm sorry, but doesn't the government artificially EXPAND access to oil? I mean, with things like liability caps, doesn't it take away much of the risk in drilling for oil in places like the Gulf?
QuatFax 5 months ago
*applause*
Very logically put. I'm impressed. :)
vspqbd 9 months ago
Stef, can you put your sources in the video description?
vspqbd 9 months ago
@cdriggs NO. Gas prices go up, things that transported shorter distances or grown close to home get cheaper comparatively, we buy more stuff from our neighbors instead of China. REMEMBER your gas prices are already higher than you think. Gas prices are something like 6 dollars per gallon with all the hidden subsidies in place. Since subsidies are debt, our current system makes you rob your children of their future income to buy your gas today. How do you know so much about the effects of crack?
anampaiseanta 1 year ago 2
good video
a4finger 2 years ago
1. So: supply of oil is not yet a critical factor.. and..
2. interesting way to look at it.. so.. the low gas prices we have now was actually an indicator of considerably lower production, with the global economic crisis?
FreiheitKampfer 3 years ago
Sure, which data do you mean?
stefbot 3 years ago
Actually, increased transportation gas prices represent only a single percentage point or so of final sales price, so your thesis I'm afraid is not correct... :)
stefbot 3 years ago
Aren't China and India able to build cheaper laptops because their labour is paid and treated literally like slaves, especially compared to Western labour?
Rsd79 3 years ago
Stefbot may have a rational argument but is it an ethical one, since it requires exploitation of workers?
Rsd79 3 years ago
But this is how they get paid more, by being more productive... :)
stefbot 3 years ago
Stef, I have watched many of your videos and think you are highly intelligent. What would be your response to the argument that the Fed is pumping money into the market to avert a collapse and this is devaluing the dollar? It is not that prices are going up, but rather the purchasing power of the dollar is declining.
jfnuyen 3 years ago
Well the test for that is whether gas prices are going up around the world...
stefbot 3 years ago
This is wrong in so many ways.
cyberrigger 3 years ago
explain.
kimuraftw 3 years ago
stefan for prez.
Adrenik 3 years ago 2
sephethus: Because a rising tide lifts ALL boats.
Pension funds grow daily, and companies still have to employ their capital. They have to invest *somewhere*. The thing is, there is NOWHERE they can invest to avoid the "rising tide" of inflation due to higher energy costs. So they invest in the same places as before, that have the differential price advantage: China, and India. So, life goes on, much as before, except now the transfer of wealth from consumers to oil execs has stepped up a notch
lastnymleft 3 years ago
peperpnch: Supply and demand are factors, as is peak oil. But supply hasn't halved and demand hasn't doubled, in the last year. What HAS changed is the amount of USD in the world. The Fed has been flooding the world with USD. M3 money supply is currently running at 17%! Those new dollars are all competing for the same commodities, driving ALL prices up: oil, wheat, rice, etc. There is no "food shortage", either. The dollars have been devalued, so it takes more to buy the same amount of commodity
lastnymleft 3 years ago
During a recent trip to the Middle East, Bush called for OPEC to increase oil production. He was trying to create the perception that he cares. OPEC rejected the call, saying that production is meeting demand, so there's no point in lifting production rates. That's an operational matter, and can be easily falsified, if not true. No-one has.
Bush's call for increased production was a facile attempt to blame OPEC. The MAIN problem is the FED debasing the USD, making ALL commodities more expensive
lastnymleft 3 years ago
things getting cheaper?! does the fact that basically all consumer goods are transported using oil? the high costs raise shipping costs, and who do you think takes the hit on that? investors...of course not, it's the consumers, so where is the net gain in that?
95mscottb95 3 years ago
The overall cost must still be cheaper, otherwise no one would be investing in China and India - think labor costs, for instance...
stefbot 3 years ago
right so if cost goes up then so does price, even if it is on a small scale like in China and India, there are so many steps between the Factory in China and your house. Planes, ships, warehouses, road transportation. To cover the rising oil costs in these steps and keep profits up, consumer prices go up.
95mscottb95 3 years ago
I don't know if this guy's a trader, an oil company spokesman, or just naive - BUT I'VE NEVER SEEN SO MUCH BULLSHIT IN 1 VIDEO.
1st - his premise that we have a "free market" is off-base.
We have an over-supply at this time (Oil Execs have admitted as much) & yet prices increase.
I live close to some Houston Oil Execs & massive amts of money have been transferred from the lower & middle classes to them! WHAT I SEE IS DISGRACEFUL & some get off-shore accts & dont even pay tax on int.
DillonX 3 years ago
Yes, as I mentioned several times in the video, I am only talking about the free market elements in the equation, of which there are still some...
stefbot 3 years ago
hello, it seems your Caps Lock key may be broken.
kimuraftw 3 years ago
The market will conserve the supply. All we need to do is get the government out of the oil industry. "Society" doesn't have to do anything.
kulza23 3 years ago
Agreed. It's very difficult to disentangle things, but fiat money, limitations on where oil firms can drill, government subsidies to "clean energy" etc. all impact the price of oil. Oil firms have little reason to expand supply anymore, as if a move away from oil is completed, it'll be a waste of cash.
Moragauth 3 years ago
Bah, meant to post this in response to lukeev.. not ran. :P
Moragauth 3 years ago
Not one of your best videos Stef, because I think it may have been possible to simplify it more.
Anyway, the responses to this video just goes to show how little people actually believe in the effectiveness of free market. (silly bums) :-)
I think most people don't like the idea of free markets because they're addicts. They're addicted to what ever the regulated market is giving them.
Sepero1 3 years ago
steph, i dunno how many ppl can say this, but i have seen every video & listened to every podcast you have. and i agree with you 99.9% of the time. but i think you are way way off here. in your example a $200 price savings on laptops would not be nearly enough in saving vs the mass # of consumers paying the high price. also, it doesnt make shipping cheaper, look at reality & food prices. for real, reality doesnt back you up in this instance, maybe im wrong, but i dont think so.
cozmikzen 3 years ago 2
Glad Stef finally did this video. I've been going crazy trying to fend off all the 'OMG oil prices rising bla bla bla' people.
lukeev 3 years ago
There are so many conflations juxtaposing free market conditions on what is an interventionist system.
TehBANN3D 3 years ago 2
Can someone say vulgar libertarianism?
TehBANN3D 3 years ago
No, I'm saying that in macro-economics a lot of effects do not filter down for quite some time. The Fed has been flooding the world with USD, trying to prop up an unsustainable financial system. They are delaying the effect, but are making the ultimate collapse worse. The extra dollars flow through Wall Street, then to producers, then to consumers, as dollar debasement/price inflation - a process that can take up to 18 months. So people are making buying decisions *now* based largely on old news
lastnymleft 3 years ago
Just wait till they start blaming the evil speculators...
Moragauth 3 years ago
I don't buy laptops enough to see a lower cost of living.
DotPaulish 3 years ago
Doesn't matter - the business you buy from all buy laptops... :)
stefbot 3 years ago
touche
DotPaulish 3 years ago
Sounds nice but IMO it is a sign of collapse of america and later a lot of other countries as the dollar devalues.
NeonKnight88 3 years ago 2
That's not rising oil prices, that's your FED printing money out of thin air.
lukeev 3 years ago 2
Says the guys who no longer need to drive his car >_>
lordmetroid 3 years ago
Not to mention the higher energy prices will spur development of high technology alternatives to oil which will be primarily centered in western developed nations.
studio7manga 3 years ago
Seeing the oil execs in front of Congress really made me think of Atlas Shrugged...
SeanCitizen 3 years ago
This comment has received too many negative votes show
The answer is -- monopolies.
Shut up!
NoRoPaul 3 years ago
Your next video should be how to love getting kicked in the nuts... I disagree with you that gas is going up because of India and China. The reason gas is going up is the same reason why Gold, grain and other commodities are going up. The debasement of the dollar to pay for the welfare/warfare state. I don't know why I should be happy about the Empire robbing me blind. India and China only play a small part in the commodity boom the real reason is the Fed's overprinting the money supply.
willyswear 3 years ago
Hey, I was going to say that!
Even if a manufacturer could produce the laptop cheaper, transport costs and general inflation (due to USD debasement) are the tide lifting ALL boats, be it India, China, England, US, etc. EVERYTHING gets more expensive with higher gas prices. The fact that people have continued to purchase laptops is a factor of market inertia. The effects of capitalism are not instantaneously reflective. Spending areas are being prioritized, and some sacrificed. Laptops not *yet*
lastnymleft 3 years ago
I know what the hell is Stef thinking saying this B.S it sounds like the bullshit they spout off on CNBC and other bubblevision channels. Pretty soon Stef will get on here and start saying "the economy is Goldilox" like that dumb ass kudlow was saying right up and through the housing bust.
willyswear 3 years ago
Not to mention the conflict in places like Basra . .
robshred66 3 years ago
Yes but that doesn't argue *against* Stef's points about consumption etc. Both of these forces are at work, the FED debasement of the dollar *and* foreign competition for oil. They go 'hand in hand' - it's not as black and white as people think.
lukeev 3 years ago
So it's time to ride my bicycle and purchase more consumer electronics eh?
comradepinko 3 years ago
yeah, comradepinko,
and whistle while you pump, because the tires and tubes are made from petrolium and since they will get expensive (together with the lubeoil, and well, pretty much most of the other parts) you will use more tubes/bikes/year/price
so whistle while you pump; it lowers the blood pressure...
adorianvlad 3 years ago