I'll take Adam Smith for $4 Billion, Alex...
Gee - who woulda thunk it?Yes, I am piling on my
previous post on Commodity Markets and Oil Companies. I might as well, since the oil companies are.
River City, WI
Good anaology on one of the Republican AG candidates from
Grumps.
I played the Mayor in my high school's production - think it was due to all of his singing parts!
Not quite what Adam Smith meant...
The following is my amature economic theory (I only got a Minor in Econonics, not a degree!) - I invite confirmations of fact and refutations with fact as well! If nothing else, it makes for interesting coversation.Any oil company exec will tell you that the rising cost of oil represents an increased cost of doing business and thus that cost must be passed on to the consumer at a relatively equal rate to prevent financial damage from occuring to the company.
However, smart investors know
how the market really works! What they know is that Exxon/Mobile, as well as the others, not only run a business as refiner/distributer/retailer, but they also serve as a commodities market middleman. In commodities trading, you are investing in the future price of goods -- if the price goes up on a commodity you own, that directly increase the value of your commodity. However, if the price drops, the value of what you purchased has now lowered. This scares off a lot of would be investors from getting into the commodities market - it can be a get rich quick market, but you can also take a nose dive in a big hurry.
A good Wall Street investor knows that the oil company can act as a safety valve for the risk of commodities trade while still offering, albiet diluted, profit opportunities.
Consumers are used to the fact that when the price of oil jumps to $75 per barrel, the gas pump prices will jump immediately. If the consumer questions why the gasoline that Citgo bought off of oil that had sold for $68 per barrel is now priced at the $75 per barrel rate, they might get a tutorial on how commodities markets work. Increased price in oil raises the immediate "value" of all oil related products on hand.
What consumers need to be asking though is why, in a commodities ruleset, doesn't the price of gasoline at the pump drop just as quickly when the price of oil drops? Under a true commodities model, this should be the case. But here is where the Wall Street investors understand the reality -- the oil company realizes its profits by passing price reductions based up on the actual cost of the oil refined, not the current commidity value.
What other company do you see investors flocking to when their primary cost of production skyrockets?? If the price of steel jumps, the stock in GM can drop. But somehow, that cause-effect relationship just isn't there with the oil industry. The investors obviously know their economics a lot better than the normal guy paying $2.91 per gallon!
Making Public Notices that much more Public
The Gazette is advocating something I have been thinking about for a while now. I was just thinking of writing on this subject, honest!
One of the public awareness issues that Evansville has long struggled with is public notices. State Law requires that municipalties post advance notice on meetings, zonings, conditional use permits, variance requests, and a few other things both in a physical accessible location (typically City Hall) as well as in a newpaper that meets certain criteria (I wonder how long before the League of Municipalities takes up this issue? It would be far cheaper, however, to post the notices on the web than print them in the paper. Arguably, if a City is doing their website in house (or at least has update access to it), posting notices shouldn't be any additional work than preparing them for a newspaper.
Am I advocating such a shift? Not really, but it is something that I think will gain momentum - especially with increased pressures placed on budgets. Evansville now spends $900/month for the Review to publish notices - that's $10,800/year or half a police car or one fourth of a Public Works shed or the cost to asphalt a block - or four computers, etc. Doesn't seem like much money?? I doubt the Finance Committee has changed much other than faces from when I chaired it but those items would be cause for a hour long discussion - don't underestimate temptation of being able to save $10,800!
Of course the Gazette is arguing to replace newspaper notices with the web, that would be counter to their business objectives. But savvy city officials looking to save a buck or 10,000 might jump to that conclusion.
Beltline Blues
This may come off as a whiny speeder rant - if so, my apologies. For the record, I didn't get caught.
Apparently not to be outdone by the
Town of Madison, the City of Madison held a nifty little sting operation this morning on the Beltline. I counted four squad cars, a motorcycle cop, and a roadside assistance truck running the operation in the eastbound lane between Stoughton Road and the Interstate to get the morning rush hour speeders.
On the surface, this is a great plan -- traffic thins out enough after Stoughton Road that those who have been tailgating the slow moving (60-65 mph) cars since Park Street finally have enough room to cut across lanes and speed to the Interstate at around 70-75 mph. The State Patrol will occasionally set up a car just past Stoughton Road to catch these speeders.
Here is the problem -- because the Beltline goes
over Stoughton Road with a curve added for flavor, the road beyond the intersection is not in line of sight. Rarely is there any sort of slow down however, since half of the traffic just exited at Stoughton Road. Imagine the look of horror in the drivers' eyes this morning when the sped over the viaduct and suddenly saw traffic at a standstill (I kid you not!) cause they are all slowing waaaaaay down to see who got pulled over for speeding.
The fact that you are driving into the sun is not helpful. Nor is the Roadside Assistance Truck the police have set up with flashing lights warning that the left shoulder is closed (so they have room to pull over speeders). Not only is there the potential for a major multi-car accident, but the very police officers involved are now putting their lives in jeopardy since they are standing in the path of potential escape route for a driver who might not have seen the traffic jam in time.
Funny thing is, I thought catching speeders was meant to make the roads safer.
Green's re-Fuse-al to deal with reality
One of the challenges of living in an older home is trying to run all my electronic gizmos with a 40 Amp Fuse Box. To keep the antique wiring from overloading, I know that I should be using 20 Amp fuses at the most. But the temptation is always there to push my luck with a 30 Amp fuse so that I can have the TV, Computer, Printer, Shredder, and Window Air Conditioner all on the same circuit. The danger of course is that instead of overloading the fuse (which is what you want to happen if you are overloading the system), I overload the wires instead and risk a fire.
Some folks just aren't comfortable with this kind of set up. They don't trust it because you have to understand the process and pay attention to make sure the system isn't being abused. They bemoan the fact that rewiring and upgrading to a 100 Amp Circuit Box is too complex, so they find ways to over-protect the system instead. They choose to use 15 Amp Fuses instead of 20 Amp -- thus ensuring that the system is never abused or overloaded. Problem is, as time goes forward, the demand for more juice keeps on growing. You are stuck with at system that while "safe" no longer serves its primary purpose -- to service the home.
Now apply this logic to property taxes, and you can see the wisdom (or lack thereof) of TABOR, TPA, and
Mark Green's latest election promise. Sure it's "safe" -- but how does local government decide which vital "appliances" for the community simply need to be unplugged? The easiest campaign pledge for a state office seeker to make is to freeze local taxes -- they don't have to worry about the cuts.
