Obama: Fuel Efficient Cars to the Rescue! Bo: HA!

I read this article today, noting that Obama is touting fuel efficient cars are 'the answer' to rising gas prices. Actually, lower gas prices would be the answer I am looking for. Let's put this into perspective here...

I am the 'greenie' in the family. I conserve water when I am able, recycle everything I can, turn off lights when I leave the room and keep the house cooler in winter and warmer (somewhat!) in summer. Likewise, if I had it my way, I'd have a lovely $25K solar array on my roof so the power company would owe ME credits on my summer cooling bills but the problem there is that I don't have $25K to make that happen!

I realize that we need to conserve energy and natural resources. I also realize that energy alternatives will be our future. HOWEVER (and this is a biggie) this is TODAY and NOW. Right now gas prices are too high; families are going to make proper choices with this new reality--do I go shoppping or do I fill up my tank so I can get to/from work? That's the TRUE reality today. Using ME as a case study, tell me how the new fuel efficiency standards are going to help ME? Oh, you say I need to buy a new car for that to happen? Sorry, that's not in the budget! SO now what? I am stuck paying for expensive gas! I cannot run out and buy that Gucci edition Fiat 500 (or better yet, an Abarth) or even a cool little Kia Soul like the other dancing hamsters.

No, while we are blessed to have 3 vehicles, the reality is something different than what Obama seems to realize. My commute? It's 57 miles a day. I can't change that (and remember that most of that 57 mile run will be spent sitting still or rolling at 5-10 MPH. As a closing attorney, I often close loans out of my office. Roundtrip to my Alpharetta client is around 38 miles (plus that lovely $1.00 in tolls on GA 400) but at least that's at speed-limit (or higher) speeds most days. What about those cars? 2 of the 3 take PREMIUM fuel and the other is a minivan that averages (on a good day) 19MPG. So what am I to do? NOTHING! I am expected to shell out almost $4 for premium and over $3.50 for regular. So again, how are those fuel efficiency standards helping ME? Cash for clunkers? No thanks. While the 1999 SUV has over 165K miles it's still running great; the 2000 sedan has over 151K and is still going strong. That 2009 minivan is the 'child' of our automotive family and is nearing 30K but no matter what we are unfortunately tied to the fuel pump.

So again I ask our current administration--what is that fuel efficiency doing for me? What does it do for 'Bubba' and his pickup? That single Mom with a car as old as mine? A working family who can afford only one vehicle? It does NOTHING for us all!

Why is gas so expensive? OIL prices are going up! Why are oil prices going up? Besides commodities brokers and Wall Street speculators (shame on you!) at last check the middle east is a mess and demand is through the roof in China and all over the world. How can you decrease prices? By lowering demand (NOT going to happen) OR to increase supply! Gee Bo, how can we increase supply? Why ask Obama why he didn't approve the Keystone XL pipeline (POLITICS of course!)? That would have increased supplies. What about drilling in ANWAR in Alaska? Again blocked by politics! Even though drilling today wouldn't result in oil production for at least a decade, it would put the world on notice that there are other sources coming on-line and as a result prices would DROP. But again, let's make the environmentalists happy at the expense of our National Security (yes, our SECURITY).

Bottom line, YES we need OPTIONS. But NO, right now gas prices are too high--a better Prius or a Ford Fusion Hybrid (41 MPG!) would be nice but that's not the answer. Not for right now, this second. More supply = lower prices! Give us more options for production!

That dreaded "I" word...

Yes, INFLATION. Anyone alive in the Jimmy Carter era just visibly shuddered (I know I did)... What about inflation? Well, the Fed has kept rates incredibly (artificially?) low in order to spur on the "recovery" (again in quotes due to the low rate of job creation) and certain sectors have experienced rising costs. The Producer Price Index (PPI) is up, which would typically bring us a rate increase--ditto for consumer goods and energy pricing. SO if Inflation is coming (or is already here as some say) we would typically see the Fed raising rates after this week's meeting. What's that mean to you and me? Well, things seem to be improving relatively quickly, except for jobs, though there was a small drop in November's unemployment numbers. While energy prices are up the price of oil and gasoline has dropped recently. In essence there are a lot of positive things happening (even increased consumer spending was reported!) but there is still a 'wait and see' feel to our nation. I don't think anyone will feel comfortable while jobs are still getting slashed (which will continue into 2010 per many Economists) and until this health care fiasco is sorted out (put it this way--if you were a small business owner, would you be hiring right now with the uncertainty of being in business with the possible changes on the horizon?). Likewise, we have a long way to go despite all the 'dog and pony' shows going on about banks. There are few modifications taking place and the ones that are proceeding aren't helping to stop the flow of foreclosures. And to add to the misery, we STILL have at least a year of adjustable rate mortgages 're-setting' (possibly two) due to the large numbers of 5/1 ARM refinances that happened... well, just over 5 years ago. So what of inflation? If things keep improving and (as noted in several postings) if we continue 'printing money' the Fed will HAVE to raise rates. Will the struggling economy be able to take that shot? As always, time will tell :) Good luck, God Bless, Be safe... Bo

What a difference a day makes

Well, new home sales are down by 3.6% to a seasonally adjusted annual rate of 402,000 as reported by the Associated Press today. Why is that a bummer? Economists expected growth to the tune of 440,000. Whoops! Guess all is not well with our economy is it? Oh well, don't worry about that, let's focus all our efforts on healthcare while the country flounders. But hey, oil prices dropped because our economy sucks and due to a strengthening dollar (stong dollar usually equates to weaker oil prices as oil can be used as a hedge against a falling dollar). The world seems to see the global economy strengthening, I hope they are correct (and that sales rise in the last quarter of the year!). Fingers crossed!