Crude Oil and how it affects and benefits consumers.
We all know the big talk in our economy is the soaring gas prices, weak dollar, inflation, rising food costs, and the infamous stimulus check!
I know many forum members have decided to invest their stimulus checks into paying down credit card debt, which, in turn doesn't really "stimulate" the economy. This in turn will slowly continue to make the dollar weaker, the Euro stronger, and China more attracted to buying our oil. Analysts see the oil at $150/barrel by the end of the summer. I see that as being very feasible, however I'm gonna raise some different questions that I'm sure moser or fatabbot can answer for me.
What will happen to airlines with the raising oil prices? American Airlines is already starting to charge $15 for the first bag check. I flew for the first time in August and I had my bagged checked and had my shampoo and another item thrown away. My g/f was embarrassed because she thought I heard about not being able to take liquids on a plane. With this question does that mean that they will check backpacks and purses and charge you a $15 fee? If so then that's basically extra revenue for the airline company to make money, because they have to check these bags anyways.
The gas prices are affecting my girlfriend and I when it comes to planning a trip together this summer. They're not affecting her as much, because she's flying from Fayetteville, AR to LA in two weeks for $212 round trip. We could barely fly to Vegas for that last year out of Tulsa, OK. She ultimately got a good deal and jumped on it. We chose to drive my car to Myrtle Beach this summer instead of flying, because to fly and rent a car would cost us about $500 each. I can drive my car for much less money and deal with the long road trip. Airlines are really in a sticky situation, because they have potential of losing money no matter what decision they make. The oil price is expected to continue rising through August, and there's potential people will decide not to fly and travel shorter distances by car. Either way they look at it they could be in potential danger.
Another question I have is what is going to happen to auto manufacturers. I already read today that Ford is going to cutback production of SUV's. The upside and downside of this is less babies being born. Who wants to take a vacation with a family of 5-6 in a Toyota Prius. What sucks for Ford, Chevy, and GMC is that trucks and SUV's have been their strong points, while Toyota, Honda, Hyundai, and Kia have been making a killing with economy cars. This will force Ford, GMC, and Chevy to make better cars for the consumer, and not just good enough cars for rental companies. One thing I hardly ever see on the roads is a rental Civic or Camry, however I will always see a Chevy Cobalt, Ford Taurus, Ford Focus, or Chevy Malibu. I know a family that is on their 2nd Taurus and they love the car, because they drive a lot and aren't into leather and the many other amenities, but that alone won't sell that car. The resale of the Taurus is also definitely and eye sore. The Taurus is a nice car for racking up the miles, but that's about all it has for desire.
I personally somewhat support the price of oil going up, because it forces us to look at other alternative energy sources; however, I see it really hurting the economy. When you're living on your own making $8/hour and half your hourly wage goes to a gallon of gas is a little exhorbent. I only make $10/hour and 40% of my wages can potentially go to fuel. The one good thing I've seen from higher fuel prices is that fast food companies are really pushing cheaper foods on the menu. Taco Bell now has a $.79, $.89, and $.99 menu. The items on it are actually good items and not just junk.
Overall crude oil per barrel is high, but I've learned to cut things out to easily make ends meet. However, the only way these prices will go down is stimulus checks need to "stimulate the economy" and we need to drive less as a nation. These two things combined could at least slow the process of crude oil increasing, and the dollar could also gain some much needed strength. The Euro is eating our lunch, and China buys all our oil, because our dollar is weak atm. Sorry, but this whole rant was brought on buy the 426 point drop of the DOW in two days.
LMFAO "oh i thought i didn't need that" i bet in your head you were like "go kick your mom in the ass for me when you get home " 08mazda2.0