O/T - Gas Pricing

A man eats two eggs each morning for breakfast. When he goes to the grocery store he pays 60 cents a dozen. Since a dozen eggs won't last a week he normally buys two dozens at a time.

One day while buying eggs he notices that the price has risen to 72 cents. The next time he buys groceries, eggs are 76 cents a dozen. When asked to explain the price of eggs the store owner says, "the price has gone up and I have to raise my price accordingly".

This store buys 100 dozen eggs a day. I checked around for a better price and all the distributors have raised their prices. The distributors have begun to buy from the huge egg farms. The small egg farms have been driven out of business. =A0 The huge egg farms sells 100,000 dozen eggs a day to distributors. With no competition, they can set the price as they see fit. The distributors then have to raise their prices to the grocery stores. And on and on and on.

As the man kept buying eggs the price kept going up. He saw the big egg trucks delivering 100 dozen eggs each day. Nothing changed there. He checked out the huge egg farms and found they were selling 100,000 dozen eggs to the distributors daily. Nothing had changed but the price of eggs. =A0 Then week before Thanksgiving the price of eggs shot up to $1.00 a dozen. Again he asked the grocery owner why and was told, "cakes and baking for the holiday". The huge egg farmers know there will be a lot of baking going on and more eggs will be used. Hence, the price of eggs goes up.

Expect the same thing at Christmas and other times when family cooking and baking happens. This pattern continues until the price of eggs is

2.00 a dozen. The man says,"there must be something we can do about the price of eggs".

He starts talking to all the people in his town and they decide to stop buying eggs. This didn't work because everyone needed eggs. Finally, the man suggested only buying what you need.He ate 2 eggs a day.

On the way home from work he would stop at the grocery and buy two eggs. Everyone in town started buying 2 or 3 eggs a day. The grocery store owner began complaining that he had too many eggs in his cooler. He told the distributor that he didn't need any eggs.

Maybe wouldn't need any all week. The distributor had eggs piling up at his warehouse. He told the huge egg farms that he didn't have any room for eggs would not need any for at least two weeks. At the egg farm, the chickens just kept on laying eggs.

To relieve the pressure, the huge egg farm told the distributor that they could buy the eggs at a lower price. The distributor said, " I don't have the room for the eggs even if they were free".

The distributor told the grocery store owner that he would lower the price of the eggs if the store would start buying again. The grocery store owner said, "I don't have room for more eggs. The customers are only buy 2 or 3 eggs at a time". =A0"Now if you were to drop the price of eggs back down to the original price, the customers would start buying by the dozen again".

The distributors sent that proposal to the huge egg farmers. They liked the price they were getting for their eggs but, the chickens just kept on laying. Finally, the egg farmers lowered the price of their eggs. But only a few cents. The customers still bought 2 or 3 eggs at a time. They said, "when the price of eggs gets down to where it was before, we will start buying by the dozen."

Slowly the price of eggs started dropping. The distributors had to slash their prices to make room for the eggs coming from the egg farmers. The egg farmers cut their prices because the distributors wouldn't buy at a higher price than they were selling eggs for. Anyway, they had full warehouses and wouldn't need eggs for quite a while. And the chickens kept on laying.

Eventually, the egg farmers cut their prices because they were throwing away eggs they couldn't sell. The distributors started buying again because the eggs were priced to where the stores could afford to sell them at the lower price. And the customers starting buying by the dozen again. =3D=A0 Now, transpose this analogy to the gasoline industry. What if everyone only bought $10.00 worth of gas each time they pulled to the pump. The dealers tanks would stay semi full all the time. The dealers wouldn't have room for the gas coming from the huge tank farms.

The tank farms wouldn't have room for the gas coming from the refining plants. And the refining plants wouldn't have room for the oil being off loaded from the huge tankers coming from the Middle East.

Just $10.00 each time you buy gas. Don't fill it up. You may have to stop for gas twice a week but, the price should come down. Think about it, seriously, and act.

Reply to
fiveiron
Loading thread data ...

They'd double the prices so you needed to buy $10 worth twice as often.

Reply to
clifto

If everyone stopped driving one day per week, and rode with a friend, then the consumer gas consumption would drop about 14%, and the oil companies would shit in their shoes.

Cut it to two days a week, and you would see the response quickly.

We have been coached in individualism from our births. But the only way we can fight this is collectively.

If you want to see them squirm, STOP BUYING SO MUCH GASOLINE. It can be done...really.

Reply to
<HLS

I don't see the difference between me buying $10 every two days or $35 worth every 7 days. I still end up spending $5 worth every day.

Reply to
« Paul »

If everyone stopped buying gasoline, there would be a glut, and the oil companies would have no place to store it all, so they'd drop the spot price to clear out the excess. The upshot is that we'd have very cheap gas for a while until the surplus was consumed.

A similar thing happened a few years ago with Alberta beef up here in Canada. I had never seen beef so cheap (and young and GOOD) as I did then.

Economics isn't as simple as it appears on the surface.

Reply to
Hugo Schmeisser

worth >every 7 days.

===== I think the point they are trying to make is, don't be a storage facility for the "oil

companies" - when they are up to their ass in undeliverable gasoline - it's no fun

for them, they want to dump it, and usually at a reduced price.

mho vfe

Reply to
fiveiron

Well... ok. But to me it still sounds like the same amount get used in the same time period. Now, if we could just get the boss to let us work from home...

Reply to
« Paul »

Sounds like my ex-wife's economics. When I told her she was overspending my salary, she just charged what she wanted. (Which is one reason she earned her ex-wife's merit badge.)

The only way to send a message is to actually cut down. And the results of that may well be temporary relief. There is no sign that oil prices are going to drop, and our continued high consumption will continue to feed the supply/demand monster.

Reply to
<HLS

Nah, they'd just dump it into another country who needs more like China or India. Price would be better for them if we used less - plus their industrialization would shoot even further ahead of the U.S.

Not an answer.

B~

Reply to
B. Peg

For a while, their sales would fall off, but within a week or two the stations would be selling just as much gasoline every week as they did before. There would just be more sales, smaller sales, and longer lines at the pumps.

I agree that the only way to affect fuel prices is to use less of it.

Reply to
Frank

One day while buying eggs he notices that the price has risen to 72 cents. The next time he buys groceries, eggs are 76 cents a dozen. When asked to explain the price of eggs the store owner says, "the price has gone up and I have to raise my price accordingly".

This store buys 100 dozen eggs a day. I checked around for a better price and all the distributors have raised their prices. The distributors have begun to buy from the huge egg farms. The small egg farms have been driven out of business.

The huge egg farms sells 100,000 dozen eggs a day to distributors. With no competition, they can set the price as they see fit. The distributors then have to raise their prices to the grocery stores. And on and on and on.

As the man kept buying eggs the price kept going up. He saw the big egg trucks delivering 100 dozen eggs each day. Nothing changed there. He checked out the huge egg farms and found they were selling 100,000 dozen eggs to the distributors daily. Nothing had changed but the price of eggs.

Then week before Thanksgiving the price of eggs shot up to $1.00 a dozen. Again he asked the grocery owner why and was told, "cakes and baking for the holiday". The huge egg farmers know there will be a lot of baking going on and more eggs will be used. Hence, the price of eggs goes up.

Expect the same thing at Christmas and other times when family cooking and baking happens. This pattern continues until the price of eggs is

2.00 a dozen. The man says,"there must be something we can do about the price of eggs".

He starts talking to all the people in his town and they decide to stop buying eggs. This didn't work because everyone needed eggs. Finally, the man suggested only buying what you need.He ate 2 eggs a day.

On the way home from work he would stop at the grocery and buy two eggs. Everyone in town started buying 2 or 3 eggs a day. The grocery store owner began complaining that he had too many eggs in his cooler. He told the distributor that he didn't need any eggs.

Maybe wouldn't need any all week. The distributor had eggs piling up at his warehouse. He told the huge egg farms that he didn't have any room for eggs would not need any for at least two weeks. At the egg farm, the chickens just kept on laying eggs.

To relieve the pressure, the huge egg farm told the distributor that they could buy the eggs at a lower price. The distributor said, " I don't have the room for the eggs even if they were free".

The distributor told the grocery store owner that he would lower the price of the eggs if the store would start buying again. The grocery store owner said, "I don't have room for more eggs. The customers are only buy 2 or 3 eggs at a time". "Now if you were to drop the price of eggs back down to the original price, the customers would start buying by the dozen again".

The distributors sent that proposal to the huge egg farmers. They liked the price they were getting for their eggs but, the chickens just kept on laying. Finally, the egg farmers lowered the price of their eggs. But only a few cents. The customers still bought 2 or 3 eggs at a time. They said, "when the price of eggs gets down to where it was before, we will start buying by the dozen."

Slowly the price of eggs started dropping. The distributors had to slash their prices to make room for the eggs coming from the egg farmers. The egg farmers cut their prices because the distributors wouldn't buy at a higher price than they were selling eggs for. Anyway, they had full warehouses and wouldn't need eggs for quite a while. And the chickens kept on laying.

Eventually, the egg farmers cut their prices because they were throwing away eggs they couldn't sell. The distributors started buying again because the eggs were priced to where the stores could afford to sell them at the lower price. And the customers starting buying by the dozen again. = Now, transpose this analogy to the gasoline industry. What if everyone only bought $10.00 worth of gas each time they pulled to the pump. The dealers tanks would stay semi full all the time. The dealers wouldn't have room for the gas coming from the huge tank farms.

The tank farms wouldn't have room for the gas coming from the refining plants. And the refining plants wouldn't have room for the oil being off loaded from the huge tankers coming from the Middle East.

Just $10.00 each time you buy gas. Don't fill it up. You may have to stop for gas twice a week but, the price should come down. Think about it, seriously, and act.

Nice story, where do you buy 2 or 3 eggs at a time?

Reply to
Jay Britton

To really put this in perspective, the egg farmer would have to own the grocery store and would sell to different stores at different prices. In fact, the egg farmer would set it up so that he was selling to other countries. He would be selling so much to other countries that he would have to buy a few eggs from yet another country. As the supplying country raised they're prices to the egg farmer, he would raise his prices to the grocery stores on all eggs he sold. Even the ones from his own chickens.

The only way a boycott or 'short-purchase' would work would be to only buy your eggs from another egg farmer/grocery store, even if the price was higher. The one farmer/grocer would then find he was selling no eggs and have to lower his price. As he lowered his price, people would buy from him only and the other farmers/grocers would have to beat his price. The problem here is that the farmers all got together and said, "hey, since we own all the grocery stores, if we close half of them, people would be less likely to be inconvenienced and not shop around for eggs anymore. They'd just be glad to find it. And, if we charge the little independent stores even more for eggs, people would be glad to pay our inflated prices. And.... If we gave the Gov't buckets of cash and free eggs, they'd back us on this idea!"

Just a question.... Have you ever wondered how much EXTRA sales tax is raised for each state on the inflated prices? Lets look at California for example: I got my gallons figures at:

formatting link

15,941,733,000 gallons sold (gasoline only) in 2004 43.6 million gallons sold per day Since the per gallon taxes don't change, we won't discuss that (other than the fact that you're paying sales tax on those taxes.....). The 'percentage of the sale' taxes do change however. If you look at what we were paying for the same fuel a few years ago at say $1.50 per gallon and compare that to now at $2.75 per gallon, thats an extra $1.25 per gallon that's generating tax. So, let's do some math. $1.25 X 43.6 million gallons of fuel per day = $54,500,000.00 EXTRA money changing hands that is being taxed. I think the state sales tax is about 7.75%. Again, some math. $54,500,000.00 X 7.75% = $4,223,750.00 PER DAY generated for the fine Gov't of California alone. How bad do you think Uncle Sam wants to see those prices drop??? You gotta wonder where that EXTRA 1.5 BILLION dollars is going each year???? (for california alone.....)

Don't forget the EXTRA $54,500,000.00 generated for the Egg Farmer.......

Reply to
osbornauto

nice try. it would only work if you actually BOUGHT LESS GAS, not the same amount of gas less often.

Reply to
news

would raise prices by 16.27% to make up the difference.

Yes. They'd raise prices by 38.89% to make up the difference.

I tried that once, and my car stopped travelling so many miles. Had to call a friend to bring MUCH GASOLINE to continue.

You must think we go out riding to burn off excess gasoline.

Reply to
clifto

What is it about Alberta beef? Is it that it's refrigerated on the hoof?

Reply to
clifto

Oil doesn't come from chickens; you can't increase a finite supply by buying more chickens. Halfwit.

Duh.

Go watch the Simpsons.

Reply to
EatMe

same time period. Now, if we could just get the boss to let us work from home...

Reply to
EatMe

The entity posted thusly:

I buy less gas at a time when the price is up, but I have no illusions that it will cause the price to drop, even if everyone did it. The reason I do it is because I benefit from the price differential.

Currently, gas is about $1.05/liter (southern Saskatchewan), so I only fill the tank on my pickup, or the tank on my wife's car. When the price drops, I fill the tanks as above, but also fire another 450 liters into a storage tank. If the price drops below the price I paid for the storage tank full, I keep filling the truck and car at the pump.

Reply to
Oleg Lego

No, I don't think that. But I DO think that most Americans are accustomed to having cheap and readily available gasoline, and don't spend a lot of effort in finding ways to use less.

Reply to
<HLS

MotorsForum website is not affiliated with any of the manufacturers or service providers discussed here. All logos and trade names are the property of their respective owners.