High gas prices

[martho]

94 hours

using 5 gallons per engine hour (average)

that is only 470 gallons

Last summer, at $3/gal, that would be $1410 for the whole summer. Is my math that far off or did your vehicles use most of that $1000/month in fuel?

So, if you use your XTi the same amount of hours this year, it will cost you 470 * the price increase of fuel. So if gas is $1.50/gal more this summer, it will cost you $705 more for the entire season. Divide $705 by the number of months you use the boat and you have around $125+/- per month in added expense for the fuel.

[auto]

Alright, you want to talk about house prices you got it. What do you think a house payment is for a house that costs $600,000 even if you put $100,000 down and this is not your nice a$$ kind of home that is less than 10 years old. This is where we live and we have to deal with it, we live in Calif. in the Bay Area very close to San Fransisco which has been rated one of the top 10 most expensive cities to live in (in the world).

That is "why" we are buying some property in TX, not that I pay that anymore because I am renting but my last house payment was $2500 on a $350,000 loan. You can do the math and figure it out, I was just adding that some people pay that and it's amazing to me but it is normal here. My boss pays, $4,200 for a house that is not much bigger than the one we live in and all it really has more than us is a pool and bigger back yard.

It's only a statement about how hard it is where we live and to have added cost in gas prices doesn't make it any easier.

Why would anyone live in Kalifornia? We all have a choice of where to live?

[edwin]

94 hours

using 5 gallons per engine hour (average)

that is only 470 gallons

Last summer, at $3/gal, that would be $1410 for the whole summer. Is my math that far off or did your vehicles use most of that $1000/month in fuel?

So, if you use your XTi the same amount of hours this year, it will cost you 470 * the price increase of fuel. So if gas is $1.50/gal more this summer, it will cost you $705 more for the entire season. Divide $705 by the number of months you use the boat and you have around $125+/- per month in added expense for the fuel.

Kinda what I was thinking...maybe a ski school puts $1000 a month thru a boat, but 94 hrs doesn't come close to touching 68 slalom's numbers.

FWIW, my total boat fuel bill last year was less than $1200.

[NorCaliBu]

I can't believe how many people in our apartment complex drive nice trucks, cars, and bikes but live in an apartment.

Buying expensive cars, trucks, boats,...before purchasing a house just seems dramatically irresponsible. As with most things...to each his own.

I just paid $4.70 a gallon today for Diesel. I bet it hits $5.00/gallon in June, with regular gasoline to follow.

Local Chevron station by my house is $5.09/gal for diesel.

[WakeGirl]

You guys that live in the midwest aren't counting how far it takes to get to our lakes out here. We are much more spread out & you absolutely have to account for the gas in the truck to get there. My lake is an hour, 1 way. And that's my home lake, I have several trips per year that are over 5 hours of driving, 1 way.

As an example....

Last April we had sort of a perfect storm where we had 3 long trips converge on 1 billing cycle. 1 gas card for one month that totaled over $1500 in gas, & that was just the gas in the truck to get to the frigging lakes. It didn't include most of the gas that we burned while we were there. That was a 1 month billing cycle, & 1 of our 3 gas cards (ableit the main one that we use). So if gas is $1.20 higher right now than the same point a year ago, that $1500 bill turns into $2000 this year. That's one card, for one month - we have other cards that we use when we can't find a Shell, & that happens plenty often. We easily have a 6 month season here, & we stretch ours out to 8-9 if I haven't injured myself.

I'm not trying to cry you a river on that, I'm just pointing out that if you live 5 minutes from the lake then yeah, you're not going to be heavily impacted & I suppose that you can discount the tow rig. But those of us that do a lot of traveling will probably be doing fewer long hauls this year because it will have a significant impact. I just laughed at your $200 figure, it's just not even in the ballpark for us. We'll deal with it, adjust accordingly, & hope/pray that the dollar will begin to rebound & that the Fed will quit with the rate cuts.

edwin,

I'd positively love to see that kind of gas bill for a season.

[jetskipro550]

You guys that live in the midwest aren't counting how far it takes to get to our lakes out here. We are much more spread out & you absolutely have to account for the gas in the truck to get there. My lake is an hour, 1 way. And that's my home lake, I have several trips per year that are over 5 hours of driving, 1 way.

As an example....

Last April we had sort of a perfect storm where we had 3 long trips converge on 1 billing cycle. 1 gas card for one month that totaled over $1500 in gas, & that was just the gas in the truck to get to the frigging lakes. It didn't include most of the gas that we burned while we were there. That was a 1 month billing cycle, & 1 of our 3 gas cards (ableit the main one that we use). So if gas is $1.20 higher right now than the same point a year ago, that $1500 bill turns into $2000 this year. That's one card, for one month - we have other cards that we use when we can't find a Shell, & that happens plenty often. We easily have a 6 month season here, & we stretch ours out to 8-9 if I haven't injured myself.

I'm not trying to cry you a river on that, I'm just pointing out that if you live 5 minutes from the lake then yeah, you're not going to be heavily impacted & I suppose that you can discount the tow rig. But those of us that do a lot of traveling will probably be doing fewer long hauls this year because it will have a significant impact. I just laughed at your $200 figure, it's just not even in the ballpark for us. We'll deal with it, adjust accordingly, & hope/pray that the dollar will begin to rebound & that the Fed will quit with the rate cuts.

edwin,

I'd positively love to see that kind of gas bill for a season.

Exactly! We have the river which is only a 1/2 mile drive but all lakes are at least an hour away. Luckily we enjoy being out on the boat just as much as we do riding. I went out 4 days in a row last weekend and only rode twice. Not cause of gas, but because boating for us is often just hanging out with friends as we float down the river. Some might argue that we should have just bought a big @$$ raft, but when we do want to ride we have the ability too.

Boating for us a time to hang out with friends and family. When you think about it in just terms of fuel expenses (not all the other costs) it's pretty "cheap" entertainment. We spent 4 days last week on the boat, with an average of 5 people for an average of 3 hours each day. We probably used less then 50 dollars in gas. Where else can you get that level of enjoyment for that amount of money? Try taking 5 people snow skiing for 4 days, go out to dinner 4 days in a row with 5 people, go to the movies, etc, etc, etc...

This is NOT directed at anyone, just something that I thought about and thought I would share...

I went over to my parents this evening to go hot tubbing and have a few beers and as we were talking about gas prices, the economy, world affairs, and politics I came to this conclusion...gas prices suck, our economy sucks, our presidential candidates suck, and everything is getting more expensive...but overall life is still pretty darn good for most all of us. The fact that we have we are able to spend our free time sitting on our computers talking about the high price of fuel that we put into our luxury boats should be an indicator of this. I am not saying this to make anyone feel bad cause you shouldn't! I just thought I would share it with you all cause it really made me stop and think.

[WakeGirl]

Well said, & exactly why I don't think about it too much other than to alter my plans to fit within what I'm willing to spend.

[areamike]

Try $500 car 1

$500 car 2

350 boat (Financed for 25 years)

500 cards

25 years loan on a BOAT?????? GEEZUS!!

No wonder some boat owners and "toy" owners don't have houses. You can't afford it. Your BOAT is your House. Enjoy living in it I guess is all I can say.

[99response]

I guess I'm lucky I have a mud puddle 10 minutes from my house and the river is only 20 minutes away.

Last year I put $20 in the boat before we went skiing, this year it will have to be $25 or $30, still cheap fun.

I guess owning both boats outright is a good thing too...

[68Slalom]

94 hours

using 5 gallons per engine hour (average)

that is only 470 gallons

Last summer, at $3/gal, that would be $1410 for the whole summer. Is my math that far off or did your vehicles use most of that $1000/month in fuel?

So, if you use your XTi the same amount of hours this year, it will cost you 470 * the price increase of fuel. So if gas is $1.50/gal more this summer, it will cost you $705 more for the entire season. Divide $705 by the number of months you use the boat and you have around $125+/- per month in added expense for the fuel.

That is combined with the truck as I mentioned above.

Tracie explained it very well, there are times the cost in gas for the truck is more than the boat. Depends on how far we go Just to get to work in my car it costs me $200 per month plus so you can add that in also. But I wasn't using that in my last comment, I just mentioned it. I don't how but your math may be right it just never adds up that way.

[68Slalom]

You guys that live in the midwest aren't counting how far it takes to get to our lakes out here. We are much more spread out & you absolutely have to account for the gas in the truck to get there. My lake is an hour, 1 way. And that's my home lake, I have several trips per year that are over 5 hours of driving, 1 way.

As an example....

Last April we had sort of a perfect storm where we had 3 long trips converge on 1 billing cycle. 1 gas card for one month that totaled over $1500 in gas, & that was just the gas in the truck to get to the frigging lakes. It didn't include most of the gas that we burned while we were there. That was a 1 month billing cycle, & 1 of our 3 gas cards (ableit the main one that we use). So if gas is $1.20 higher right now than the same point a year ago, that $1500 bill turns into $2000 this year. That's one card, for one month - we have other cards that we use when we can't find a Shell, & that happens plenty often. We easily have a 6 month season here, & we stretch ours out to 8-9 if I haven't injured myself.

I'm not trying to cry you a river on that, I'm just pointing out that if you live 5 minutes from the lake then yeah, you're not going to be heavily impacted & I suppose that you can discount the tow rig. But those of us that do a lot of traveling will probably be doing fewer long hauls this year because it will have a significant impact. I just laughed at your $200 figure, it's just not even in the ballpark for us. We'll deal with it, adjust accordingly, & hope/pray that the dollar will begin to rebound & that the Fed will quit with the rate cuts.

edwin,

I'd positively love to see that kind of gas bill for a season.

Exactly! We have the river which is only a 1/2 mile drive but all lakes are at least an hour away. Luckily we enjoy being out on the boat just as much as we do riding. I went out 4 days in a row last weekend and only rode twice. Not cause of gas, but because boating for us is often just hanging out with friends as we float down the river. Some might argue that we should have just bought a big @$$ raft, but when we do want to ride we have the ability too.

Boating for us a time to hang out with friends and family. When you think about it in just terms of fuel expenses (not all the other costs) it's pretty "cheap" entertainment. We spent 4 days last week on the boat, with an average of 5 people for an average of 3 hours each day. We probably used less then 50 dollars in gas. Where else can you get that level of enjoyment for that amount of money? Try taking 5 people snow skiing for 4 days, go out to dinner 4 days in a row with 5 people, go to the movies, etc, etc, etc...

This is NOT directed at anyone, just something that I thought about and thought I would share...

I went over to my parents this evening to go hot tubbing and have a few beers and as we were talking about gas prices, the economy, world affairs, and politics I came to this conclusion...gas prices suck, our economy sucks, our presidential candidates suck, and everything is getting more expensive...but overall life is still pretty darn good for most all of us. The fact that we have we are able to spend our free time sitting on our computers talking about the high price of fuel that we put into our luxury boats should be an indicator of this. I am not saying this to make anyone feel bad cause you shouldn't! I just thought I would share it with you all cause it really made me stop and think.

Patrick, you are totally right. It would just be nice to have that extra $500 a month (just an estimate for some people) to spend on your family or other things to help stimulate the economy not have to pay it out on something we have done in the past and haven't changed anything. The govn't knows we have to drive and the people that do are just having to pay more for it now. Imagine if rent went up up 25% (just think about that, and everyone raised the price at the same time) but your still living in the same place and nothing has changed you wouldn't have a choice. That is my point.....but yeah, I should be out working instead of sitting here crying about it.

[NorCaliBu]

I guess owning both boats outright is a good thing too...

No doubt.

I have been going through some employment "challenges" lately (the auto delaership that I worked for completely shut down their Internet Sales Dept so no need for an Internet Sales Manager ) because the Sporty is paid for instead of being a liability it became our safety net if we needed it. Thankfully I start a new job on Tuesday and we didn't have to sell the boat but if we had a boat payment it would have been gone.

Nice point Patrick, even with the "higher than what we're used to" gas prices, we're still the most blessed country on earth.

Edited May 23, 2008 by NorCaliBu

[DIE2SURF]

Try $500 car 1

$500 car 2

350 boat (Financed for 25 years)

500 cards

25 years loan on a BOAT?????? GEEZUS!!

No wonder some boat owners and "toy" owners don't have houses. You can't afford it. Your BOAT is your House. Enjoy living in it I guess is all I can say.

I agree...which is why I've only bought used boats and vehicles, and just paid cash. I just have a hard time imagining spending $40K-$70K on a new boat (over 25 years), when I can get a great used boat for $17K-$28K...especially if you end up selling a high priced new boat for a huge loss. But then, many people are in different situations and tastes. I guess being a single dad with a 5-year-old living in expensive Cali, you do what you need to to make ends meet. I've chosen to have cars and boats that aren't the latest and greatest...it's a sacrifice I'm willing to make I guess. In the end, if your happy with your decisions, then that's all that counts.

[Guest J-Ro]

Sorry guys but I fat finger that 25 years thing. I meant 15 years.

The home price thing IS an issue here. I would love to move to ARK or TX but my career won't work outside the West or East coast.

[chrisallenhogs]

What kind of career are you in? I can buy a 3000 square foot house here for 300,000. I'm guessing most people could take a paycut and move to Ark and increase their standard of living.

[Guest J-Ro]

Institutional Investing. SF, Chicago, or NY is about all I can get. That and having 2 kids with all the family in CA make it tough to leave.

[chrisallenhogs]

We have a lot of supplier's for Wal-Mart in our Area in NW Arkansas. We have gone from an area of 200-300,000 to about 700,00 in about 10 years. Very good job market. Mostly Sales offices that support the Wal-Mart and Sam's club accounts. Real estate is still cheap, we are overbuilt so now is the time to make a move. We have Wal-Mart headquaters, Tyson Headquaters, JB Hunt Headquaters. Its a pretty nice area.

[superjet]

I think that a lot will change in America in the next 10 years. If you look at the country 50 years ago, things were very different. Families saved money and bought things with large down payments. They lived within their means, saved, and were fine with that. Towards the end of the 20th century credit became available for people who proved that they could handle it. It is human nature for people to want what others have. That along with the need for banks to find more revenue streams created a glut of credit and a paradigm shift from living within our means to telling ourselves we deserve what others had. A generation of parents chose not to teach proper financial education to their kids and the kids saw their parents do well for themselves with new cars and nice houses. Those children did not see the increasing debt load that went along with it and assumed they deserved the same lifestyle.

This has come about from the human condition of believing we deserve more. Check out the book "The Two Income Trap". Basically it says we are to blame for what is going on. People below the financial means of the 1950's single earner family decided they should have a home too. They couldn't do it with one income so they decided to have the wife work to increase their income and buying power to get that home. This dominoed with most families having more spendable income and thus they bought more. This made homes more expensive as demand increased. The cyclical effect was that more and more families had to have two incomes to live the standard they wanted. The constant need (Call it greed I suppose) to have more drove them to increase their income as much as possible. Once that road narrowed, the credit companies that were coming into vogue in the 70's and 80's were more than happy to take up the slack. Instead of stopping the spending and keeping up with their neighbors, they put everything on the payment plan and credit.

Boating is a perfect example. It has always been the domain of the reasonably well off. In the last five years, how many people have you known that shouldn't be buying the 50k truck they have let alone the 50k boat they are pulling. Can you imagine your grandparents ever going into debt that is twice their annual income for something they would consider frivolous like a new truck and boat? Lucky for the borrower they lived in the great USA where he could just afford the payments and expenses that would have kept his elders from doing it (Gas, food, insurance, house payment) were always low. Now that the debt has mounted and those cheap expenses are increasing radically, he can no longer afford it all and need to make some serious life decisions. Unfortunately this is affecting the majority of citizens and we will no longer be able to be the 70% of GDP that we have become. The consumer will not be able to pull the US out of this. The average consumer is going to need to make some serious choices. This includes how many cars they have, how they get to work, how many children they think they should have, the size of the house they want to live in, and most importantly the standard of living they THINK THEY DESERVE. There won't be an easy answer for most people. They will have to come to the realization that they cannot afford that new TV, car, or whatever else their friend just bought. They may even have to get rid of new century necessities like cable TV, Cell phones, DSL, and cheap cars.

The next decade will be an interesting study in human nature. Of course that is just a hypothesis and an opinion.

The first "serious choice" that most will make is to vote for legislators and presidents that will promise them more entitlements and fulfill their "I deserve it" point of view. You even see that on this forum. Companies are chided for making a profit that some see as excessive. If you were a stockholder of that company, you would likely have a different point of view.

As long as speculators can go long on oil futures and short the dollar on low margin, you should expect a marginal increase of $20-50 per barrel over the price that simple supply-demand would support. Study the numbers - consumption and supply have been relatively equal for the last 5 years. There's just not much cushion built into the system for refined products. Worldwide volatility creates opportunities to make "bets" on refinery upsets, geo-political upsets, etc. China is hoarding diesel in preparation for the Olympics. These are all factors that cause current price spikes, but corrections will happen.

Why doesn't anyone complain about the tax increases/spending increases that local governments are getting (but not exposing) due to the value of crude oil and it's derivatives? In states where inventories are taxed, the tax rate has stayed relatively the same while the base value of these products are up at least 4x. The state and local government, just sits back and quietly collects 4x the tax and spends it.

And, on the subject of those rebate checks -- that is just a big wealth redistribution scheme. For those of you that received a check, it's likely that you're receiving money that someone else paid in, not your own. Many people did not get a rebate.

[obski]

It's all over the news this morning that gas at some stations is going over $4 a gallon, with one station at $4.29 per.

I reflected that I have made some changes, such as driving my fuel efficient Saturn more than my Tahoe, and thinking twice about making some trips. The price of gas though still has not changed my plans for use of the boat. You make choices in life, and I am fortunate enough to be able to make the choice to spend money on using the boat. So far at least the price of gas has not changed that area of my life, but that is my choice.

[DIE2SURF]

And, on the subject of those rebate checks -- that is just a big wealth redistribution scheme. For those of you that received a check, it's likely that you're receiving money that someone else paid in, not your own. Many people did not get a rebate.

Yup...and I'm one of those. Apparently I make too much $; but in Sacramento, CA, sure doesn't feel like it.

[Guest J-Ro]

Super-Jet-

Excellent post. Especially about the long short strategy.

[chrisallenhogs]

SJ

good post. I believe they are trying to pass legislation on margin requiremtents. Anyone have any word on when they might raise the amount of actual capital you have to have before you can trade. I think right now I can get an account and trade with only 5% backed by capital? Anyone know if this is right?

[Guest J-Ro]

I believe it is either 5 or 10% and it will go to 50%. Not sure how soon this will happen though. Personally I think anyone who buys futures must take delivery of a certain percentage.

[Squag Mon]

I'm buying more peanut butter

[hrybls]

I believe it is either 5 or 10% and it will go to 50%. Not sure how soon this will happen though. Personally I think anyone who buys futures must take delivery of a certain percentage.

It would be funny to see bunch of pork bellys delivered on someones front yard......they would think twice next time.

Oh, by the way go long pork bellys futures! (in Canada anyhow)