> -----Original Message----- > From: brin-l-boun...@mccmedia.com [mailto:brin-l-boun...@mccmedia.com] On > Behalf Of Bruce Bostwick > Sent: Friday, January 23, 2009 12:20 PM > To: Killer Bs (David Brin et al) Discussion > Subject: Re: Scouted: U.S. to collapse in next two years? > > On Jan 23, 2009, at 12:00 PM, dsummersmi...@comcast.net wrote: > > > Since then, I've been seeing promises of competative electric cars. > > When > > gas prices were at $4.50/gallon, the premium for hybrids was within > > $1000 > > of being a wash. But, now that prices are back close to $1.50 > > (around here > > at least....but when we were up near $4.50, I'd guess you were > > higher too) > > hybrid sales are falling like a rock. > > And that, in turn, is a symptom of how susceptible the mainstream is > to short-term thinking and its application to decisions with long-term > effects.
> People buying cars really seem to think that fuel prices will always > be what they are right now, and we won't have another $4+/gal peak or > even higher soon. They also really seem to think there won't be an > overall upward trend on top of seasonal and market-driven > fluctuations. Discounting 2008's ups and downs (which were spectacular), we saw a steady price trend in most commodities (e.g. iron ore, tin, gold, aluminum) from the mid 70s to 2007: downward. Last year was a roller coaster, but few of the folks who are responsible for making long term decisions that are highly dependant on prices assumed that 4+ dollar gas would last long. The bet in the oil patch was that oil prices would settle back under 80. If you really believe that oil will go back north of 100 within the next 5 years, you should sell oil short on the futures market. The long term trend is off this bottom, but you could still sell for 62 dollars in 2 years and 70 dollars in 5. That's consistent with the general range that long term projects were assuming last summer, when prices spiked near $150. So, on average, $2.50-$3.00 (inflation adjusted) gas is a good bet for the lifetime of a car. >No other interpretation makes sense to me, when people > turn around and buy 10-15 mpg SUV's and pickups the moment fuel goes > down below $2/gal. (The only exception would be if they plan to trade > the thing in next summer when the fuel prices go back up, which is a > different kind of insanity.) But, they were buying them in decent numbers when gas was $2.50-$3.00/gallon. There is nothing that indicates that the long term average price of oil (say over a 5 year period) will go above $80.00/barrel within the next decade. The oil patch would love steady oil in the 60-80 dollar range, and steady natural gas at about $6.00/thousand cubic feet. Remember, peak oil was first predicted to be within 5 years in 1920. Dan M. _______________________________________________ http://www.mccmedia.com/mailman/listinfo/brin-l
