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Thread: Category 3 gas prices

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    Category 3 gas prices

    There is something I have recognized as unintuitive but can’t adjust the numbers even for a close approximation.

    Let’s suppose you’re financially well off such that you could EASILY afford $100 a gallon gas prices. Many people can afford that without a smidgen of difficulty, and it would surely bring a sigh of relief when it comes to traffic; however, an attempt to sustain such prices would yield such catastrophic results that society would be brought to a halt. Where would rich people even have to go? The closed down stores with no products, services, or even employees? That’s (oh, I’m just going to call it category 5 gas prices (like a hurricane classification).

    If gas prices went to $8 a gallon, it would have a significant impact (category 1) but life would not cease from having a presence on the planet. There would still be food. There was would be electricity. There will be a society left to adapt, but the important point here is that the people who can afford category 5 prices could afford the consequences of a category 1 sustained price level.

    Now, my numbers may be severely off. Maybe $6 is a cat 1 and $25 is a cat 5. I have no idea, but what’s not readily intuitive (unless you consider the unexpected consequences the impact would have on society) is that being financially well off and being able to afford cat 4 or 5 gas prices don’t go together. Maybe if you were a billionaire, fine, but a low level millionaire wouldn’t handle well the resulting consequences of sustained egregious prices.

    My question is at what price point (category 3) would things be so bad that those who can’t afford it would have their lives terribly disrupted but not so outlandishly so that those who can afford it would only be moderately affected?

    Is the margin thin? Like, would $10 a gallon be a cat 4? In a sense I’m looking for a tornado like or hurricane like understanding of the spectrum of gas prices to social devastation. How much intensity I should have behind a jaw drop after hearing something about what they might go to is completely unknown in the grand scheme of things.

    It’s like if a weatherman screaming about a severely dangerous hurricane is approaching, I know how to adjust my jaw and my eyes when I hear it’s a cat 1 vs a cat 5, and I’m pretty darn sure that $100 a gallon is far past a cat 5, I have no way of judging any television screams regarding gas. Yeah, $12 a gallon is bad (I got that: it’s very bad), but is it really and truly a cat 5 like they sound or is it really a cat 2? See, that’s the problem, and I have no idea the answer.

  2. Top | #2
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    Quote Originally Posted by fast View Post
    There is something I have recognized as unintuitive but can’t adjust the numbers even for a close approximation.

    Let’s suppose you’re financially well off such that you could EASILY afford $100 a gallon gas prices. Many people can afford that without a smidgen of difficulty, and it would surely bring a sigh of relief when it comes to traffic; however, an attempt to sustain such prices would yield such catastrophic results that society would be brought to a halt. Where would rich people even have to go? The closed down stores with no products, services, or even employees? That’s (oh, I’m just going to call it category 5 gas prices (like a hurricane classification).

    If gas prices went to $8 a gallon, it would have a significant impact (category 1) but life would not cease from having a presence on the planet. There would still be food. There was would be electricity. There will be a society left to adapt, but the important point here is that the people who can afford category 5 prices could afford the consequences of a category 1 sustained price level.

    Now, my numbers may be severely off. Maybe $6 is a cat 1 and $25 is a cat 5. I have no idea, but what’s not readily intuitive (unless you consider the unexpected consequences the impact would have on society) is that being financially well off and being able to afford cat 4 or 5 gas prices don’t go together. Maybe if you were a billionaire, fine, but a low level millionaire wouldn’t handle well the resulting consequences of sustaines egregious prices.

    My question is at what price point (category 3) would things be so bad that those who can’t afford it would have their lives terribly disrupted but not so outlandishly so that those who can afford it would only be moderately affected?

    Is the margin thin? Like, would $10 a gallon be a cat 4? In a sense I’m looking for a tornado like or hurricane like understanding of the spectrum of gas prices to social devastation. How much intensity I should have behind a jaw drop after hearing something about what they might go to is completely unknown in the grand scheme of things.

    It’s like if a weatherman screaming about a severely dangerous hurricane is approaching, I know how to adjust my jaw and my eyes when I hear it’s a cat 1 vs a cat 5, and I’m pretty darn sure that $100 a gallon is far past a cat 5, I have no way of judging any television screams regarding gas. Yeah, $12 a gallon is bad (I got that: it’s very bad), but is it really and truly a cat 5 like they sound or is it really a cat 2? See, that’s the problem, and I have no idea the answer.
    How is this a math question? Sounds like social science to me.

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    Your OP is what economists do. They can model the effect of gas price on the economy numerically. Economics as a category instead of math. Beyond me.

    As I understand it gas prices have always been higher in Europe than the USA, putting more emphasis on public transport.

    It was cheap gas that killed public transport and trains in the USA.

    As the price of gas goes up the price of goods and services go up. It is more than who can afford to pay high prices.

    Take away the taxes and gas is cheap. It is supply and demand. Crude oil prices vary daily. SA has a had a lot of control on global price by controlling supply.

    Here in the USA with fracking and shale oil there was an oil boom. As supply went up price went down for oil and a number of companies went bust. Supply and demand.

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    Mazzie Daius fromderinside's Avatar
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    Looks to be an economic Least-upper-bound property problem to me.

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