Gas prices making anyone reconsider?

[altona]

Yes, that is true. Most weeks it averages out to abot .5% drop from previous week. In terms of $ amount that is approximately $200 ON THE WHOLESALE SIDE of the equation. That is not always a direct match to any retail price drop, if any, especially if the dealer is low on good low miles used inventory.

This "fuel crisis" will surely accelerate some drop in bigger more fuel hungry vehicles in the near future.

 

[Stbentoak]

From Wall Street Journal a few months ago.....

The Federal Reserve on Thursday reported that the net worth of U.S. households was $134 trillion in the second quarter—up from $128.4 trillion in the first quarter. That figure stood at $110 trillion In the fourth quarter of 2019, before the pandemic took hold. Including nonprofits, accumulated household net worth in the second quarter hit a record $141.7 trillion.



Much of that increase in wealth came about from gains in stock prices and the value of people’s homes, but what may be most notable is how much more money people have lying around in cash. The amount of cash and cash equivalents on household balance sheets rose to $16.5 trillion in the second quarter, from $16.3 trillion in the first quarter and $12.7 trillion at the end of 2019.
It is a reflection of both how much people reduced spending, particularly in the early stages of the pandemic, and the substantial relief that the federal government has provided. Chances are that cash has continued to build up since the end of June—the latest data from the Commerce Department show that in July people hung on to 9.6% of their after-tax income, which compares with an average personal saving rate of 7.4% in the five years ended 2019.

 

[Quark]

Rising inflation and a spike in energy prices are exactly the reasons the Fed would raise interest rates.

Their reluctance to get ahead of this is framed in the word "transitory". What makes you think they've had a change of mind?

 

[firsttimetahoe]

Rising inflation and a spike in energy prices are exactly the reasons the Fed would raise interest rates.

Do you know how bad the shape of this economy is for a lot of people in the lower class? Raising rates when you have near record inflation is going to impact a lot of people very badly. They will not be able to refinance their debt. People will default on their debt. We haven't seen the worst of it.

 

[firsttimetahoe]

It is a reflection of both how much people reduced spending, particularly in the early stages of the pandemic, and the substantial relief that the federal government has provided. Chances are that cash has continued to build up since the end of June—the latest data from the Commerce Department show that in July people hung on to 9.6% of their after-tax income, which compares with an average personal saving rate of 7.4% in the five years ended 2019.

People were spending like crazy in the beginning of the pandemic. Everyone was doing home renovations. Everyone I knew. People have slowed down their spending because their is now a huge shortage on goods. And prices have gone up significantly.

 

[Polo08816]

Their reluctance to get ahead of this is framed in the word "transitory". What makes you think they've had a change of mind?

Haven't they moved away from considering this transitory? If their assumptions have changed, would you expect their future actions to change as well?

 

[Polo08816]

Do you know how bad the shape of this economy is for a lot of people in the lower class? Raising rates when you have near record inflation is going to impact a lot of people very badly. They will not be able to refinance their debt. People will default on their debt. We haven't seen the worst of it.

The Fed's mandate is to balance inflation with employment. We're at full employment. In fact, we have a labor shortage. The economy (and by economy, I don't mean the stock market and equities that the upper middle class and above are heavily invested in) can endure significant interest rate increases.

 

[Baja_Bob]

I paid $4.98 for my 93 octane yesterday, and I know that this price is relatively low compared to other parts of this country. I'm fortunate in that if gas prices get really out of control, I'll drive my Honda Fit more than my truck. But, I'm never going to get rid of my truck, just because of high gas prices. It is just too much fun to drive the truck.

I agree, my yukon only gets driven on the weekends, I also have a 21 bronco sport 1.5 3cyl. that I drive to work daily, bought it for the gas mileage. It averages 28-30mpg.
Still don't want to pay $5.00+ for gas in any vehicle.

 

[firsttimetahoe]

Yeah, that $1200 to people earning less than $30K a year really was lovely, probably floated them for 25 days with the cost of rent alone... You do know that the majority of states living off the gov't welfare are red states, right?? Sorry, no politics, I know...

If you earn less than $30k a year why are you buying a Tahoe/Yukon/Escalade?

 

[Pertzbro]

This is the problem. Printed too much, too quickly.

M1

View a measure of the most-liquid assets in the U.S. money supply: cash, checking accounts, traveler's checks, demand deposits, and other checkable deposits.

fred.stlouisfed.org