Inflation

[JerBer]

This escalation in the price of crude oil has gotten me scared! The prices of everything are tied to the price of it in one way or another and if something doesn't give soon this country is going to be experiencing some big time inflation!

How does the market usually fare in such a climate? I would think inflation has an adverse affect on consumer confidence.

JerBer

[tsptalk]

Inflation is not generally good for the market. It gives Greenspan another reason to raise rates. I don't know too much about it but I hear economists talking about controllingdeflation as it could be a bigger problem.

I believe this oil price climb is temporary. It seems like it happens every few years and then things come back to normal. Right now it just happen to be the new reason for market concern. Every time we get bad news from Iraq, oil jumps up and the market reacts negatively.

I wouldn't put it past some bears that were heavily short the market starting the wedding party bombing rumor. The military is disputing the news as I hear it. Cramer at thestreet.com talks about this type of unscrupulous behavior going on when things get away from larger investors. It's illegal but it sure worked today if that was what it was.

[Wimpy]

Re: escalationin the price of crude

Since JerBer's original post in May of 2004, almost 18 months ago,the price of oil is roughly 50% higher, even after the recent pullback.

I believe oil is going higher mostly due to Asian demand. Third world countries are coming into their own Industrial Revolution and there will be many Asians moving from poverty level to middle class.An increase in Asian, particularly Chinese,automobile ownership and use willkeepintense upward pressure on oildemand and pricesfor some time to come.

Of course, any disruptions to normal supply vianatural disastersand terrorism will only aggravate what is currently seen as a very serious situaton.

Suburbistan will increasingly feel the effect of high oil prices. As commuters in the burbsfeel the crunch of gas prices at the pumps, they will be looking to trade in their low gasmileageSUVs for high gasmileage hybrids.Some may even decide to unload their homes in the burbs for something a little closer to where they work. Suburbistan Malls could become little ghost towns unless employers begin adopting a more liberal telecommute policy...and soon. We can hope...can't we?

Thecurrent price of crude at $60.00would be around $25.00 in 1980 dollar terms and in 1980-81 I think the price reached about $50.00 a barrel. Today,it would have to hit $120.00 per barrel of crude tobe theequivalent of the 1980-81 highs. I think the Asian factor will take the price signficantly higher than $120.00 per barrel in the next 4-7 years. $6.00-9.00 a gallon at the pump would not be an unreasonable expectation, but it would have a significant impact on consumer spending and travel.

Yes, the price of crudewill come down, but from much higher levels, in my opinion.

[bkrownd]

You would have thought the US would have learned its lesson around 1980, but nope, our country went back to its lazy wasteful habits. So here we are, listening to the doom-and-gloom about energy prices again. My vehicle is powered by soy milk, coffee and tea. Happy to be a mizer. :oo

[bkrownd]

bkrownd wrote:
Happy to be a mizer. :oo

Grrr... Miser, dang it. :h

[Wimpy]

bkrownd wrote:
My vehicle is powered by soy milk, coffee and tea. Happy to be a mizer. :oo





Good for you! You are saving money and improving your health at the same time.

My vehicle will be twenty years old next year. Licensing is about 20 some odd dollars a year and full coverage insurance is about 250 a year. Why full coverage insurance on a car this old? If I need to take a long distance trip (vacation)where reliability could be a concern, I just rent a car and pretend for a weekor two I'm a consumerist. My personal insurance covers rental liability/collision for the full value of whatever I rent as a replacement vehicle. If my personal car breaks down locally, I just call AAA and have it towed and repaired. It has about 250,000 miles on it and gets about 20 miles to a gallon and runs like a top.

If someone gave me a new car, I would sell it immediately and buy something of value with the money. A new car would probably cost me 300-400 dollars a year tolicense and I have no idea what the annual insurance premium would be, but I'm sure it would be much more than I'm willing to pay. I can't bear the thought of the opportunitycost/lost of buying a new vehicle and theassociated overhead.

[bkrownd]

Wimpy wrote:

My vehicle will be twenty years old next year
Right on yer tail at 18! Unfortunately moving to hawaii has cut my poor car's life short by 5+ years, as I'm losing the battle with rust in this pea soup they call "air" here, even though it spends almost all month sleeping safely in the garage. The damn humidity corrodes everything inside and out. I just need it to stay together until I get off this rock...

[Shaggy]

I am looking now at a 30 year old VW convertible to purchase. Like you guys I hate new cars because they are just such bad investments. I figure a VW convertible has to at least maintain it current value and has the potential to go up in value. There are very few vehicles you can buy and actually use regularly that will maintain there value.

[mlk_man]

With all the broken down cars I see driving to work, I'm contemplating buying a wrecker! If I can get one tow either going to work or coming home, I've paid for my gas and my car payment for the day!!! :^

[Wimpy]

mlk_man wrote:
With all the broken down cars I see driving to work, I'm contemplating buying a wrecker! If I can get one tow either going to work or coming home, I've paid for my gas and my car payment for the day!!! :^


Great minds think somewhatalike!

I’ve thought about buying a wrecker myself and possibly starting a salvage business. A wrecker and salvage yard business could be quite profitable over the next 4-7 years. The state will be wanting to clear the roads of all those SUVs parked alongside the road that ran out of gas and the banks will need someone with a wrecker to do repo work for them. The banks will soon find out they can get more money for the repo’d SUV by salvaging it for scrap metal than they can by selling it as transport. I will then step in and hand them my business card, 'Wimpy's Wrecker and SUV Disposal Service -- We Weigh and Pay on the Same Day'.

Can you imagine trying to unloadan SUVs when no one wants one? You’ll pull into the auction lot and instead of them gathering any information about year, make, model, or condition…they’ll just want to weigh it.

Instead of buying a new car with my wrecker and salvage business profits, I'll roll those profits into distressed homes andproperties. The best time to buy homes and property is ina sea of foreclosures.

[Shaggy]

Have a friend who owns a wrecker service. Gov regulations and insurance is a killer. Tough business.

[mlk_man]

Sounds like a plan. But how often do you think you'll hear "I'll gladly pay you Tuesday for a tow today"..............:P

[mlk_man]

Shaggy wrote:
Have a friend who owns a wrecker service. Gov regulations and insurance is a killer. Tough business.But it's just a "commuter vehicle" I promise...................LOL

[mlk_man]

Speaking of tow trunks, here's what happens when Grandma and her friends get in an accident:

http://www.chumfm.com/MorningShow/bits/march24.swf

[JOVARN]

Well Wilma is gone and my new screen room suffered zero damage.

Every tree in my community is gone and the tree trimmers are making a fortune, do you think any of them are in the S&P?

My Kitchen ceiling has a few wet spots but all in all I did ok. Just got power and phone back today and was stuck in the market past few days. Oh well its only money and I have years to make it up. S&P is at 1180 I bought in at 1177 so I am still holding on to a small gain.

Do you thing if I told the TSP managers that I had no power or Phone service they will let me change from C fund to G fund to avoid the drop today. Just a thought :)

South Palm Beach county and Broward county got slammed they will not get their power back until Nov 14th or so.

Gas stations are not operating because they have no power, plenty of gas but no generators to operate the pumps, Gas lines are 3 hour wait. Someone asked me if I was going to wait on line to get gas to go to work. I told them if the VA wants me they will figure out a way to come and get me. Anyway I have 650 hours of AL

The non coastal areas suffered the worst damage, so much for charging the coastal people more money for insurance, what a rip off that has been over the years.

[JOVARN]

Well Wilma is gone and my new screen room suffered zero damage.

Every tree in my community is gone and the tree trimmers are making a fortune, do you think any of them are in the S&P?

My Kitchen ceiling has a few wet spots but all in all I did ok. Just got power and phone back today and was stuck in the market past few days. Oh well its only money and I have years to make it up. S&P is at 1180 I bought in at 1177 so I am still holding on to a small gain.

Do you thing if I told the TSP managers that I had no power or Phone service they will let me change from C fund to G fund to avoid the drop today. Just a thought :)

South Palm Beach county and Broward county got slammed they will not get their power back until Nov 14th or so.

Gas stations are not operating because they have no power, plenty of gas but no generators to operate the pumps, Gas lines are 3 hour wait. Someone asked me if I was going to wait on line to get gas to go to work. I told them if the VA wants me they will figure out a way to come and get me. Anyway I have 650 hours of AL

The non coastal areas suffered the worst damage, so much for charging the coastal people more money for insurance, what a rip off that has been over the years.

[Wimpy]

JOVARN,

Glad you didn't suffer too much damage to your place.

You mentioned lines in front of the gas stations waiting for the power to be restored to run the gas pumps...but what about the ATMs?

[grandma]

JOVARN wrote:
. I told them if the VA wants me they will figure out a way to come and get me. Anyway I have 650 hours of AL

It is good to hear you are okay. Asfor your AL, this would seem to be a good time to use up how-many-ever-hoursyou aren't allowed to roll over into next year, that `use it or lose it' phenonomen of the VA.

MLK_MAN wrote:Speaking of tow trucks, here's what happens when Grandma and her friends get in an accident...

Everytime I listen to that recording, it is as funny as it was the first time. That laughter is certainly infectious -

I)How did thatget recorded? Mlk - you make it sound likethere's beenmore than just this accident !!!http://i4.photobucket.com/albums/y106/triso/dead04.gif

[mlk_man]

grandma wrote:

Everytime I listen to that recording, it is as funny as it was the first time. That laughter is certainly infectious -

I)How did thatget recorded? Mlk - you make it sound likethere's beenmore than just this accident !!!http://i4.photobucket.com/albums/y106/triso/dead04.gif



I think the guy was talking to his friend's answering machine since he never says anything.

I just assumed there was more than one accident by looking at your avatar. Beagles are notoriously bad drivers.................why just the other day one almost ran me off the road because he was trying to lick his, uhh nevermind............the things drivers try to do when their behind the wheel..............:*

[mlk_man]

JOVARN wrote:
Well Wilma is gone and my new screen room suffered zero damage.

Every tree in my community is gone and the tree trimmers are making a fortune, do you think any of them are in the S&P?

My Kitchen ceiling has a few wet spots but all in all I did ok.
Glad to hear your safe JOVARN. Make sure you treat those wet spots so that no mold forms.

M_M

Breaking the mold

In "Rebuilding America's Atlantis," my three-part Daily Dose series last month after September's hurricane Katrina laid waste to historic New Orleans, I warned about the coming "second disaster" of toxins in the water supply and infection caused by stagnating standing water.

But another threat has emerged that may prove more even sickening to the populace and costly to contend with as both of these other fears combined: Mold infestation.

Anywhere there's moisture, there's mold. In any given house, there's likely some mold, somewhere. Usually, it's fairly small scale, contained and easily dealt with using ordinary household cleaners or a 10% dilution of regular bleach. And despite recent years' hype in the mainstream over alleged mold-related illnesses, if it doesn't get out of control, most of the time a little household mold won't cause more than a passing lung irritation or some minor breathing struggles.

However, in places like the moist, warm sub-tropical American south, mold tends to be more of a problem than in cooler, dryer regions. And when flooding or periods of extended submersion occurs in these zones, the aftermath can be mold infestation on a scale that's hard to combat. Such is proving to be the case on an unprecedented scale in the now-drained New Orleans...

According to a recent Associated Press report, experts fear that the mold infestation in many homes is so pervasive in the aftermath of Katrina that they'll need to be leveled and rebuilt. Ordinarily, after a flood, simply cleaning and repainting walls and replacing any household items with water-holding cushions (sofas, mattresses) goes a long way toward erasing the presence of mold.

But since in many zones of NOLA, homes remained at least partially submerged for days and even weeks, evidence is piling up suggesting that entire homes (even down to the wooden studs) are now past the point where conventional methods of mold eradication will do any good. These houses are now nothing more than greenhouses for mold - and are quite hazardous indeed, especially to those with asthma or severe allergies.

And houses aren't the only areas of concern in post-Katrina New Orleans. Office buildings, businesses, schools, and hospitals are all fertile breeding grounds for these sickening spores. At least one area hospital (Charity Hospital) has been temporarily shut down because of concerns about mold-related infections. Other hospitals that remain open expect the mold cleanup to take months. And if it isn't done properly, these places could become hubs of illness instead of healing. According to the AP piece, one official from the Joint Commission on Accreditation of Healthcare Organizations claims it may be difficult to impossible to reopen some NOLA medical centers.

What makes matters worse is that in the last decade, a lot of insurance companies have revised their coverage policies to exempt themselves from mold-damage related claims after several successful "sick building" lawsuits.

These policy changes haven't been only aimed at big businesses with pockets deep enough to be able to afford to rebuild without an insurance company bailing them, but at rank-and-file homeowners, too. The AP article maintains it's because there's little science behind claims of mold-related illnesses...

The net effect is that thousands of homes whose structures have withstood the waters may have to be razed anyway - with homeowners somehow footing the bills. This could be a major fiscal crisis-in-the-making for the already beleaguered region.

Bottom line: The extent of the mold infestation in New Orleans - and the extent of needed demolition and reconstruction because of it - won't be known for some time. But as I said before, regardless of what it costs or how long it takes, I still think we should rebuild this great metropolis on the Mississippi - and do it right this time. It's simply too important to our history and heritage to allow it to be consumed by mud, mold, and mosquitoes of the swamp it's surrounded by...

That's easy for me to say, though. I'm not trying to salvage my waterlogged house with no insurance to help, no gun to protect myself from desperate vandals, and no guarantee from the government that another storm won't do the same thing next year - or a week from now.

Like many who've fled the Big Easy for good, that might prove more than I could take.

Still mournin' N'awlins,

William Campbell Douglass II, MD