I'm allergic to numbers, always have been. My 1 + 1 equals 2, but my percentages don't always add up to 100%. I think that comes from a lifetime of robbing Peter to pay Paul and other creative bookkeeping techniques. In light of this as a frame of reference, I am confused about the state of today's economy.A headline in today's news says "Dow plunges 350 on weak service sector." Now, the service sector (restaurants, retailers, banks) is two thirds of our economy, keep in mind. We lost jobs for the first time in years, and now they are looking for the collapse of collaterized bonds and securities (mortgages). All of this "drives a nail into the coffin from investors' minds that we're in a recession."
Yet, yesterday's news included an article that said: "Buoyed by soaring crude oil prices, Exxon Mobil announced yesterday that it set new records for U.S. quarterly and annual corporate profits in 2007, and Chevron, the nation's second-largest oil company, also reported big gains in earnings." As if that isn't enough to make your blood boil, the same article says, "Even after paying taxes and expenses, Exxon earned $20.97 a barrel in profits on its production... and the company bought back 365 million of its own shares." I guess it doesn't want to share the wealth any more than it has to. Exxon also produces it's own crude - 2.5 million barrels a day and is bemoaning a 1% drop in production because it's operation in Venezuela was nationalized.
I have no idea how OPEC works, or what the price per barrel of crude is based on. But, am I erroneous in thinking that the cost per gallon at the pump is directly tied in with major increases across the board in consumer goods? Doesn't consumer spending comprise around 74% of the nation's economy?
Let me put this in real life perspective here. It now costs me $20.00 for gas what used to cost $7.00. It now costs $3.98 for a gallon of milk when it used to cost $1.98. My wages have stayed pretty much the same for as long as I can remember, yet it is costing me three times as much to heat my house in the winter, buy food and put gas in my vehicle to get back and forth to work. There is no discretionary spending in my budget. The last time I bought new clothing was over two years ago, I rarely go out to eat, and the last time I went to the movies, it was on someone else's dime. Feed for my dogs, cats and horse come out of my grocery money, and since those prices have also gone up exponentially, my diet consists of Ramen noodles and other healthy foods like that. To sum it up, 74% of my budget does not fall into service sector spending.Correct me if I'm wrong here, but didn't all this worry over recession start with major hikes in gas prices? I've always felt that Big Business was short sighted, but now it is blatantly, overtly biting the hand that feeds it, with absolutely no remorse whatsoever. The rich are getting richer, no matter the state of the economy for the rest of us.
By the way, we are in a recession. Am I more worried? No; I'm already quite used to my stomach growling.
Thanks for reading!
Id have to say that regardless of not being an economist, or a mathmatician you pretty much figured it out with common sense. I remember milk 18 months ago was $1.48 a gallon. I remember that because I thought it was kinda weird that a gallon of fuel for your car was the same price as a gallon of fuel for yourself.
ReplyDeleteMike Huckabee ( thought a bit too churchy for my taste and his "fair tax" thing makes me wonder if hes doping smoke is the only politician I have heard say it in plain words. Hes said " those that struggle in the country dont just feel fuel prices at the pump, They feel it everywhere. The feel it in the grocery store, they feel it in the goods they need, they feel the high price of gas in literally everything they do" Thats not an exact quote but its pretty close.
Its also the damn truth! Its a mess I fear may be getting worse before it gets better, and I dont trust either political party to be looking out for me, but instead firmly in the puppet strings of the ultra wealthy. Hang on...its going to be a wild ride. Once we all get too anemic to hang on THEN maybe someone will give a shit? Id say only IF our anemia is cutting into their profit margins. Hrslady
Oh, I'd say it IS cutting into profit margins now. The first thing that will go is jobs - hence the higher rate of unemployment. Higher unemployment + fewer jobs = a mess for a lot of people with no hope of getting a job or any sort of assistance because they are employable. No one will notice because the only population increase will be in the homeless, and they aren't counted, even on the national census.
ReplyDeleteYes, it's going to be one heck of a ride! The collapse was inevitable, and history has shown it happens every time. Instead of learning from history, history is ignored - all in the name of greed of the few.
I'd say it's time to plant gardens, buy milk cows and chickens, and work like crazy to get as self sufficient as possible. Our best bet at survival is to get away from currency and return value to actual 'things'. Let the rich keep all the dollar bills and coins since they are so obsessed with them. We'll just go back to living, really living. I would rather trade my wares than sell my time.
Theresa