They say that the increased milk prices are the result of the near doubling of grain costs. The grain has become more expensive, ironically, because more grain is being funneled into ethanol production.

 

Or because more land is being used for corn production and less for grain.

Or because more land is being used for corn production and less for grain.

I said grain. I probably should have said corn.

That's nice. So the refineries can "revamp', or control, the production and prices when they so desire. Bless their hearts. Who would have thunk it.:creepy:

 

Well, I have my own suspicions about why BP planned a partial shutdown of their Prudhoe Bay refinery for "routine maintenance" just a few days before Memorial Day, dropping production to 50 percent, but I'm just a conspiracy theorist. :sssh:

The only comforting thing about all of this is that it is a complete and utter confirmation of the laws of supply and demand economics and our capitalist market economy. All of this makes sense. Sooner or later, consumers will alter their consumption in some fashion and milk and gas will go down, and the cost of paint, or trash bags, or something else, will go up.

 

As long as its not beer.

The only comforting thing about all of this is that it is a complete and utter confirmation of the laws of supply and demand economics and our capitalist market economy. All of this makes sense. Sooner or later, consumers will alter their consumption in some fashion and milk and gas will go down, and the cost of paint, or trash bags, or something else, will go up.

 

As long as its not beer.

 

Sure, but when "strategic" decisions are made to interrupt the flow of supplies, I have to call foul.

Sure, but when "strategic" decisions are made to interrupt the flow of supplies, I have to call foul.

 

I think it happens quite often, and the market corrects it. Corrects it quicker if there is plenty of competition. What we may need, Jim, is MORE oil companies.

The suggestion about not buying anything at the gas station except gas is a good one.

 

Not so fast. As I pointed out in another thread, retailers make little or nothing on the sale of gasoline. Their survival is contingent upon the sale of items within their stores. Buy nothing but gas at the "convenience store" and pretty soon we'll have fewer and fewer of them which will ultimately drive the price of gas even higher as competition dwindles. Believe me, I have several clients in the "convenience store" business and there is very little profit to be made in retail fuel sales. There is a reason why Wal-Mart and Kroger sell gas now. That's because it is a draw for people to also come in and buy other goods which have the mark-ups that build the bottom line.

Not so fast. As I pointed out in another thread, retailers make little or nothing on the sale of gasoline. Their survival is contingent upon the sale of items within their stores. Buy nothing but gas at the "convenience store" and pretty soon we'll have fewer and fewer of them which will ultimately drive the price of gas even higher as competition dwindles. Believe me, I have several clients in the "convenience store" business and there is very little profit to be made in retail fuel sales. There is a reason why Wal-Mart and Kroger sell gas now. That's because it is a draw for people to also come in and buy other goods which have the mark-ups that build the bottom line.

 

True. My exhortation was a little bit of hyperbole. But, another alternative is for the gas retailers to put pressure on the wholesalers to lower the cost at the pump. As you mentioned in the P&R thread, retailers survived for many, many years with only the pump and a soda pop machine or two.

True. My exhortation was a little bit of hyperbole. But, another alternative is for the gas retailers to put pressure on the wholesalers to lower the cost at the pump. As you mentioned in the P&R thread, retailers survived for many, many years with only the pump and a soda pop machine or two.

 

I agree. Once upon a time, "filling stations" did quite well with fuel and repair services. One problem now is that the wholesale fuel distribution business is basically an oligopoly with limited competition and thus very little pricing pressure. I have actually discussed the point you mention about putting pressure on the wholesalers with my clients and basically I get the same answer that no matter where they turn the pricing structure is basically identical. Also, many retailers are committed to long term purchase agreements with their wholesalers.

Hey, I have an idea to lower the price of milk!!!

 

On June 18th, everyone across America boycott from buying milk. A similar initiative took place in the 1950s forcing milk producers to lower their costs (and started the beginning of the end of the milk man). If we all join in on this effort, we can have one calcium fulfilled life at a reasonable cost! The milk executives of the world have been taking it to the consumer too long!!!!

 

If I was buying 30 to 40 gallons of milk a week like I am for gas,, I say great idea.

One of the reasons I hear for the higher gas prices is there's not enugh refiineries to keep up with the demand.

Here's a thought: Build more refineries!

Hey Jim Schue,

 

Last night I went outside to my huge V8 SUV and cranked the car one hour before I got in to it to cool it down. I then took my huge SUV three quarters of a mile (driving it as hard as could of course to be sure to burn a full gallon) and went to Wal-Mart and bought me one gallon of milk, that is it. Got back in my huge SUV (that I left turned on to keep cool) and floored it over to the gas station and filled up with 93 octane (all while leaving my vehicle going). Cost me about $100. Then wasted about a gallon getting home. Then when I got home, I tried doing the milk challenge (you know, the one where you drink a gallon of milk in less than 15 miinutes to see what effect it would have on me).

 

I will be going tonight to buy some more milk and complete another challenge if anyone wants to come along... am I doing my part looking out for the rest of America ????

 

:p

Man I was at Wal-Mart in Murray yesterday too, I would have loved to have done the challenge but only if we could have powerbraked your SUV in the parking lot for the entire challenge:lol:

Let's not forget that while we complain about the cost of milk and gasoline, we're out there paying a $1.00 to $1.29 every day for a pint of bottled water at the convenience stores.

How come no one is complaining about the price of bread?

Let's not forget that while we complain about the cost of milk and gasoline, we're out there paying a $1.00 to $1.29 every day for a pint of bottled water at the convenience stores.

 

Amen to that.

 

I saw a guy using a credit card to purchase water one day, and thought that surely the Apocalypse was upon us.