Posted on 11/21/2008 5:51:58 AM PST by shove_it
What kind of mud hut????
What kind of mud hut????
What’s your point?
No!
This is nothing more than the priveleged upper class seeking to grind on the working class in an existential struggle for power and wealth.
...or something like that.
With Obama promising energy policies that will cause the price of electricity to skyrocket, we better stock up on batteries and kerosene lamps or just plan on the sunup to sunset lifestyle of our ancestors.
And the cause of that population explosion, no doubt...
An unexpected drop in U.S. electricity consumption has utility companies worried that the trend isn't a byproduct of the economic downturn, and could reflect a permanent shift in consumption that will require sweeping change in their industry.Yeah their "sweeping changes" was raising the rates.
Here in Northern IL, ComEd (Communist Edison) pulled this about a year ago by crying poor house to the energy commission and got a rate increase. BUT - thankfully the IL legislature stepped in and said, uh NO, increase was too high. So we all got (cough) 'refunds' over a few months. Not that they weren't 'loosing' money. Two summers ago we put in a new High Efficiency HVAC system and the year before that new Hi-Eff windows and patio door. Our summer electric bill in now cut almost in half. With our old unit and windows we cringed when we had to put on the AC, that compressor ate KWs like crazy and our Meter spun like a Tilt-A-Whirl.Fricken hypocrites all. The preach 'save energy' but when you do and they lose money they then want a rate increase so your bill stays the same. And then they think I'm going to plug an electric car in to recharge overnight?And our winter gas bill is also almost half of what it was too thanks to the new Furnace and windows. So natch, now the Gas Company is crying poor and THEY want a rate increase too.
Yeah sure, when monkeys fly out of my butt.
I thought we were told that the electrical grid was so overtaxed, and the infrastructure so out-of-date, that if there has been a decline this year it would do nothing more than give them enough breathing room to help soften the transition.
This sounds like somebody gravy-training for sure. Setting people up for a rate increase.
I remember the Carter era of “wear a sweater,turn down the thermostat,turn off the lights”;we did,and the electric utility petitioned for,and got, a big rate increase based on lessened demand not providing adequate return on investment!So we ended up paying a lot more for less electric.Rates here were 2cents/kwh in the 70s,now about 14cents/kwh.It’s difficult to state exactly because of the new base service availability fee,fuel surcharges,etc.
We're watching every KW. It's something we have some control over.
That happened some years back in Los Angeles. The big thing was to conserve - airwaves were full of cutesy "put a brick in your toilet" (pre-low flush days) and "If it's yellow, let it mellow, if it's brown, flush it down". There was the usual knee-jerk political ploy - "add a penalty if you didn't cut your water usage 10%", which ticked us off as we were always well below the average useage.
Well, people did such a good job conserving that the water company lost money and, since they had a mandated monopoly to make a profit, rates went up.
That’s caused by American Corporations turning the lights out as they move their manufacturing overseas where the tax burden is much lighter.
Is this moron asking folks to go deeper into debt just so his utility company can prosper?
Finally. Someone is asking whether the mindset of a particular market can ever permanently change. (Permanent = for the long foreseeable future.)
The answer is yes.
I do think energy consumption could be one such market. Just like Momma told ya, once you get in the habit of turning off lights, not leaving the fridge door gaping open, washing full rather than partial loads, etc., you tend to keep those habits. This is the sort of thing that is behind the contraction in consumer use of energy.
Same with gasoline. Once people were shocked into limiting their discretionary driving, they got used to not doing so much discretionary driving. Also most discretionary driving was done for the purpose of somehow spending money at the destination-—a restaurant, golf course, whatever. Once people don’t want to, or can’t, engage in the discretionary spending at the destination, they don’t need to drive there.
I see greater and more permanent mindset changes in the housing and auto markets.
Very, very little in the housing market is fueled by the absolute “need” to buy a home. In fact, theoretically, one can *always* choose to rent. But even among those who want to own a home, very few ever *must* buy and sell another one. Most home purchases were totally discretionary-—the desire to upgrade or change school districts or have a shorter commute, a bigger yard, for example-—all things that housing consumers no longer care about so much. As people begin to take the view that the house they are in now is “okay and works for them,” that huge chunk of discretionary spending in the housing market will be gone for a long, long time.
Houses don’t even really wear out!
Autos, same thing. Although autos do wear out, and there are a few reasons why people *must* buy a vehicle (their old one is unreliable, too small for a growing family, etc.), much of the auto market also was discretionary. People *wanted* a new car because they *wanted* it. Now people *don’t want* new vehicles; they only mean more debt in uncertain times. As more and more people take the view that their present vehicle is “okay and works for me,” that huge chunk of discretionary spending in the auto market will be gone for a long, long time.
If the percentage of auto owners who hang on to their car for ten years or more increases just by 10%, get used to the fact that the old days of buying a new car just because you’re jazzed about it are GONE.
Higher gas prices, and the rate at which they increased, got people feeling uncertain about the future.
Combine that with an election that thinking people knew could result in drastic and damaging "change" resulted in even more uncertainty.
Have the President and Secretary of Treasury et al. come on tv and inform you that we may be facing Great Depression II results in people getting the pajamas scared off them.
The prudent people immediately say, "we don't know where this is going, the wise thing to do is to stop spending." Consumption and consumer spending contracts radically. And no amount of "stimulus" can get that spending back because you can't stimulate confidence.
Cali’s ‘capacit’y has improved since Enron went belly-up.
Cali’s ‘capacity’ has improved since Enron went belly-up.
The savings rate at the end of the bubble period was zero. That was unsustainable and objectively dangerous in the highest degree.
As people stop spending but the government shovels money at them, running up its own debts to do so, their savings rate rises. Granted, facing a headwind from lower employment, but at the moment raises to those still working are matching declines in employment and maintaining total personal income. (It is asset values and holdings that are getting slammed, not total payroll).
Well, with spending down and personal income flat, and prices falling, the savings rate is rising. Some debts are being erased by failures and turning over collateral and write-offs and personal bankruptcies. The trade deficit is narrowing. A higher dollar and lower commodity prices are improving the terms of trade, in real terms. All of these are repairing the excesses of the bubble period, painfully and gradually in some cases, but all in the same direction. Lower household indebtedness and higher savings.
In Euros, the US economy bottomed in March around Bear Stearns day.
Meanwhile banks are reacting to higher loan losses by forcing cash to flow in their favor. That means calling in loans or letting them run off. It means not rolling over lines of credit, and taking collateral from failing borrowers. It means adding to loan loss reserves and raising capital, privately or from government injections or foreign sovereign wealth funds, etc.
All of which is performing the analogous function for corporations - repairing their balance sheets and lowering their leverage.
The government and especially the Fed are taking on debts as others add to their holdings of liquid assets against them. Every treasury issued is in someone's portfolio, often replacing a dodgier credit, and thereby reducing their risks. It is also spent somewhere and thereby winds up as a claim on the Fed aka as a dollar.
Once the savings rate has reached a level people are more comfortable with, banks have filled their loss reserves and delevered to risks they think they can tolerate, the headwinds abate. Rate spreads have widened dramatically, and sure that is painful, but it also means lenders will cover their loan losses out of the higher rates they collect from borrowers.
It won't stay down. All of these natural stabilizing processes will, in 6 to 9 months, restore final demand. They don't appear to have traction in the meantime because they are filling the balance sheet holes and allowing the savings rate to recover to something managably non-zero. But as soon as those stop moving against the direction of the stimuli, all cylinders will be firing. Consumer demand is also being deferred in the meantime, and inventories run down that will require rebuilds.
Policy can still screw things up. But without further action beyond emergency stuff to keep banks open and the like, the economy will rebound by the second half of 2009 if we are lucky, and by the end of the year regardless.
This isn't 1929. We don't have a rigid monetary system, the government isn't acting pro rather than anti-cyclically, and world trade isn't going to halt in a worldwide trade war. Economics has matured since then, we won't make the same mistakes.
The Dems may make new ones - lol - but the American economy is not going to sink. It has buried every ideology and tyranny that has risen to challenge it over several centuries, and it will bury this financial crisis.
That said, what you call the rising savings rate looks an awful lot like hoarding to others---and hoarding is a classic sign of malign deflation that, in the context of wild overindebtedness across the economy, spirals into a depression.
Also, you said: Policy can still screw things up. But without further action beyond emergency stuff to keep banks open and the like, the economy will rebound by the second half of 2009 if we are lucky, and by the end of the year regardless.
This is my (and many others') other major concern. The Rats are very likely to screw this up beyond recognition, and our country along with it. There is no way even a shadow of what they propose for the economy can do anything other than screw things up beyond recognition.
Many of the CNBC/Bloomberg guests had been saying, as you are, that this should start to turn around by mid- to end of 2009. In the last few days, however, several big-time analysts have said, no, this is (my terms) going in the direction of the Great Depression II. I will quote one well-respected equity analyst whose interview I caught last night: she used the words "continued massive wealth destruction."
This is when I first started thinking, okay, maybe this one actually *is* different.
Since you seem interested and knowledgable on economics, this article from 1933 might interest you. I found it well worth reading.
http://www.freerepublic.com/focus/f-chat/2135558/posts
Disclaimer: Opinions posted on Free Republic are those of the individual posters and do not necessarily represent the opinion of Free Republic or its management. All materials posted herein are protected by copyright law and the exemption for fair use of copyrighted works.