Text 12067, 164 rader
Skriven 2008-03-08 15:00:30 av Michiel van der Vlist (2:280/5555)
  Kommentar till text 12003 av Robert Bashe (2:2448/44)
Ärende: Errors
==============
Hello Robert,

On Friday March 07 2008 08:29, you wrote to me:


 RB>>> And then the law of supply and demand takes over and the price rises
 RB>>> - and not only for some of the customers, but for all of them.

 MV>> Yes, but it would be the bottleneck that would be the dominant
 MV>> factor. If the dominant factor is shortage of crude oil and not
 MV>> local refining capacity as I suspect, it would still be a global
 MV>> shortage of crude oil and not a global shortage of refining
 MV>> capacity that makes the price go up.

 RB> That's an awful lot of conjunctives ("if...would") and even more
 RB> speculation.

Not at all. The price of crude oil *has* risen. That is a fact. That in itself
is enough to explain a rise at the pump. So why introduce speculations about
another factor - lack of refining capacity - when they are not needed to
explain the observed facts. Ockham's razor.

 MV>> Because local effects *do* play a role in the balance bewteen
 MV>> supply and demand.

 RB> Not when we're talking about a world commodity, with a world market.
 RB> The only reason the Russians can buy their gas (not petrol, real
 RB> natural gas) cheap is because the price for Russians is dictated by
 RB> the government.

Taxing and subsidising *is* a local effect that plays a role in the balance
between supply and demand.

 MV>> If locally there is no shortage of supply, despite the fact that
 MV>> the demand goes up because of "long distance shopping" it has
 MV>> little effect on the local price.

 RB> That's an opinion that not many share when we're talking about things
 RB> that have a world market.

There is a large popular camping nearby. During the holidays it is always full
and the local supermarkets gets flooded with camping guests. An obvious rise in
demand. Does the price of milk or beer at the local supermarket go up? No it
does not and the reason is that they can easily handle the increase in demand.

 MV>> It has evened out to a great extent, but ten years ago, there was
 MV>> a significant difference in price between petrol at the pump
 MV>> between The Netherlands and Germany.

 RB> Pure taxes. That is a _very_ bad example, Michiel.

Why is it a bad example? It does not matter to the buyer what the reason is for
the price difference. The fact is that there *is* a price difference for the
buyer and that has an influence on the balance between supply and demand.

 RB>>> Supply and demand. And presumably some speculation with futures.

 MV>> You will have to explain "futures". To me that sound like the
 MV>> plural of "future" and having more than on of it is SciFi for me.

 RB> Futures are contracts for commodities to be delivered sometime in the
 RB> future.

Ah, something like put and call options.

 RB> They are sold by people who want to eliminate the risk of a drop in
 RB> the price between the time they acquire a product and can sell
 RB> it, and they are bought by people who want to eliminate the risk of a
 RB> rising market and need a set price for a raw material for their
 RB> product calculations.

Or people who speculate that they can sell next month for today's price while
the price will have dropped by then. Or buy nect month at today's price when
the price is expected to rise.

It becomes even more hairy when they agree to sell in a month what they do not
yet have today...

 RB> Naturally, you can also speculate with futures without ever providing
 RB> the goods or taking delivery, but that isn't the main purpose of those
 RB> instruments.

But a mechanism that disturbs the balance between supply and demand.

 RB>>> If there were any kind of an industrywide collusion to increase
 RB>>> prices, the governments would come down on the oil multis like a
 RB>>> ton of bricks,

 MV>> I doubt that. Multinationals are the new untouchables. Touch them
 MV>> and they flow around the forceps like an amoube. If one
 MV>> geovernment comes down on them they just move somewhere else.
 MV>> Until we find some way to *really* deal with them on an
 MV>> international level that will remain so.

 RB> You underestimate the power of the EU and the States. Those are
 RB> markets no internationally operating company can afford to lose.

Nevertheless a recent study revealed that multinationals are very successfull
in avoiding taxes. They just move their assets in such a way that they hardly
pay anything.

 MV>> Unlike the big companies where the profits flow into the pockets
 MV>> of those who already "have", the shareholders and the CEO's,
 MV>> governments don't "take". They merely redistribute. Not that I
 MV>> always agree with the way they redistribute, but I have no problem
 MV>> with taxes as such. Most of it is spend in a way that is
 MV>> profitable to me or mine. Directly or indirectly.

 RB> That's the kind of European thinking that makes high taxes without
 RB> much popular resistance possible.

What is the basic problem with high taxes? It is what is left to you that you
can spend and what you get in return for your taxes that matters.

I would rather have 100 a month of which 60 goes to taxes so that I can have
good roads than have 20 a month and pay no taxes at all and have no roads
either.

 RB> Instead of wanting to become rich themselves, the average European
 RB> envies the rich and wants to bring them down to his level.

That is a very one sided look at things. Sure there are people who think that
way. But I think the majority would rather see an increase of overall well
being for everyone.

 RB> In the States, people are generally more interested in becoming rich
 RB> themselves.

... and fuck the rest....

 RB> That's a basic difference in the mentality, and really becomes
 RB> apparent after you've lived in both societies.

I lived in South Africa. The mentality was quit American there. Me, me and fuck
the rest.

I prefer the European mentality.

 MV>> No, that is not doublethink. that is just another way of seeing
 MV>> things.

 RB> Possibly. I condemn government greed more than private greed because
 RB> governments are elected to act in the interest of their populations
 RB> and are supposed to be altruistic in that sense.

And surprisingly enough most of them *are* altruistic. If our prime minister
would be really interested in getting filthy rich himself, he would step down
right away and accept a job in industry. That pays much better...

 RB> No reasonable person expects the same of private people

*I* expect private people to control their greed and not enrich themselves on
the obvious expense of others.

 RB> and organizations, who generally act in their own interests.

In a sane and healthy society there are rules that limit people's ways to act
in their self interest. Most countries have laws against stealing. Stealing is
a way of serving self interest at the expense of others.

Cheers, Michiel

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