Welcome To Josh's Blog O' Thoughts: Gripes

I got a flyer in the mail today for Chris Dodd for President. Dodd, a Democrat, showed me with his flyer that he really, really doesn't want to win this election. The flyer DID have one good feature, a big picture of John F. Kennedy on the front side. This picture is at least likely to get peoples' attention when they see it. However, the back side, which was information about his the platform he is running with was far from inspiring.

Apparently, Chris Dodd was in the Peace Corps when he was younger. (Look anywhere you see his name and you're bound to see this fact). His platform appears to be based on "a call to service". He's interested in increasing the number of participants in the Peace Corps and Americorps, but the method which he suggest to do this is the best part. He wants to require ALL high school students to perform MANDATORY service work. Has he ever met a high school student before? Most of them don't have desire to perform service work, and anytime you make something mandatory, people like the idea even less (especially teenagers who hate being ruled). Having people forced into service work might actually be more of a hassle for these organizations as the kids won't be very motivated.

Anyway, to me, this seems like a disaster campaign. Why is he not focusing on the issues currently in the spotlight such as war, energy prices, the environment, and health care? These are the issues that will get you noticed and elected.

Perhaps he understands that since he is not Hillary or Obama, he has no shot anyway so he might as well try some goofy platform. Perhaps he just wants to waste some money. Or maybe he's actually delusional and thinks that this will win voters.

Whatever the case, he (and most other candidates) should take a cue from former Iowa Governor, Tom Vilsack, and drop out before they waste too much time and money.

Well another Fourth of July has come and gone, and for those of us that reside in Iowa, it was another year of basically no consumer fireworks. Many years ago (I believe in the 1930's) there were a couple fires started by fireworks which caused some serious property damage. These incidents led Iowa to create one of the first restrictive state fireworks laws.

To date, the only fireworks that are legal in Iowa are gold sparklers, snakes, and caps. Not only does this restrict the use of common consumer fireworks such as rockets, firecrackers, and fountains, but it also PROHIBITS the use of other very tame fireworks. Among those prohibited are popular items such as party poppers, morning glories (wooden sparklers that crackle and produce non-gold sparks), and snaps. These are common items that you can even find for sale at some Iowa stores.

This is a little bit insane. For one, party poppers and snaps contain such a small charge that there is relatively little chance of fire or injury. Additionally, metal sparklers (which are allowed) are, in my opinion, one of the most dangerous fireworks out there. Why? Because we assume they are safe for kids to play with when, in fact, they can get as hot as 1000 degrees. We then give these to little kids to wave and run around with. This is a recipe for a serious burn if ever I saw one. The wooden sparklers are much tamer. The wooden stick burns away so you are not left with a nearly-molten piece of metal in your hand. At least with items such as rockets and firecrackers, which we assume come with some risk, we (usually) behave in a safer manner.

Now, what about the financial aspect of all of this? Iowa has prohibited the sale of fireworks in the state, but several neighboring states allow fireworks sales. You then have fireworks stores popping up right across the state border that will sell to Iowa residents and charge them a hefty price in the process. Low supply means high prices. All the sales tax revenue then goes to the neighboring states even though the goods are intended to be used in Iowa.

So the bottom line is that many Iowans are still purchasing and using fireworks despite the laws against it. I live in a fairly heavily populated little neighborhood, and I have neighbors launching rockets, and shells every year. Granted, I think this is a little bit too close quarters for this type of activity. The one that gets me the most aggravated, however, is when you go to the city's fireworks and you have moron amateurs lighting roman candles and rockets in the vicinity of a parking lot crammed with 50,000 people. Yet I've never once seen a cop enforcing the "no tolerance" rule.

My suggestion is to make consumer fireworks (rockets, fountains, shells, candles, etc) a legal, but regulated activity. Make people get a license or even take a safety class. I seriously doubt that fireworks would cause more damage than other allowable items like cars, guns, candles, cigarettes, etc.

Since we are in the process of Building Our House, I have had a keen interest in mortgage rates as of late. When we first started this whole process, the rates in my area for a 30 year fixed mortgage were hovering around 5.625%. Recently, however, the rates are up to 6.25%. That's a substantial increase in the past 3 months. Knowing that the Federal Reserve Board did not raise rates at their last meeting, I thought back over the past three months to determine the culprit.

What has changed over the last three months? One major thing that I can think of is a major spike in gas prices. Could there possibly be a correlation between the two? As costs of gas goes up, the consumer price index (a major indicator of inflation) goes up as well. This is because gas and transportation costs are built in to a lot of products. When inflation goes up, financial institutions (usually in response to the Federal Reserve Board) raise rates which put strain on people's spending. By decreasing spending, inflation can be held in check or reversed. Sounds like gas and mortgage rates could be linked right?

I took a look at a graph of gas prices over the past 3 months and a graph of mortgage rates over the same time period. Low and behold, they go up in unison.

This may or may not be correlation. Or it may be a weak correlation. More study would be required to determine if the two are linked, but for my very basic examination, there appears that there could be something there.

I hope it's not just me, but the bugs this spring seem to be especially abundant. In the three years that we have lived in our house, we have had very few bugs inside the house (except for some spiders and such). This spring, however, we have tons of flies. It's very strange. I've checked all the screens and none have holes, and We don't leave our external doors open for long. The flies seem to congregate on the windows and they are so slow that you can kill them with a tissue and your hand. We have even seen a few mosquitoes inside the house which is especially troubling.

I seem to remember last fall, when it was unseasonably warm across the country, that the media was reporting that the bug population would be bad this year. I wonder if that could be part of the cause.

Is anyone else noticing a new onslaught of bugs this year?

Well it appears that I'm going to have to add some sort of validation code to the comment posts for this blog. One of my posts has recently gotten several "comments" by bots trying to post links to sites where you can supposedly buy prescription drugs. I guess it was only a matter of time.

Seriously though, who actually sees links like that and expects them to be a legitimate place to buy prescription drugs? Especially when they come in emails with all sorts of nonsense text or poor broken English to get past the spam filters? There must be some people though, otherwise why would the spammers waste their time?

It's unfortunate that there are people out there gullible enough to fall for this stuff. I watched a DateLine program a while back about Internet scams. It's unbelievable the people that have fallen for them. Even people that you wouldn't expect like doctors. You'd think they'd be smart enough not to get caught by them.

So just a tip:
Never follow unsolicited links in emails. Especially if they seem too good to be true.

The media has been reporting that the recent uptick in gas prices is due to a rash of refinery problems across the country. The fact that the country has a shortage of oil refineries and that the ones that are still operating are old and decrepid is the supposed reason that we are seeing 5% increases in a single day.

However, if oil refineries are really the problem, then shouldn't all other petroleum based products be increasing in price as well? I don't see petroleum jelly skyrocketing. Or what about everything made out of plastic such as plastic grocery bags. I recently found out that a local mid-sized grocery chain uses 5.8 million plastic bags per week! That's an insane amount of plastic to be giving away; especially if prices are rising.

Also, if refineries are not operating at normal capacity, but crude production is, we are basically building up a surplus in crude because we are extracting more than we are processing. If this is the case, we should see big reductions in price when the refineries come back online. Somehow though, I doubt that this will happen.

Therefore, I'm still under the impression that something else is the cause in this instance. I saw on the news that there was talks of beginning anti-trust investigations on some of the oil and gas companies. Maybe they are suspecting a lack of competition is drawing prices upward.

Whatever it is, I hope it reverses soon.

Many of you have probably seen the e-mails floating around lately trying to get everyone to "boycott" buying gas on a specific day. Well, yesterday was that day. Did you skip buying gas? Did it have any effect?

The answer to that last one is no it did not have any effect.

There's no way that a single day boycott, even if EVERYONE were involved, would be enough to effect the gas companies. It's just not enough impact. It will only cause people to buy more gas the day before or the day after. To have any sort of impact, you'd have to boycott for days or weeks. At that point it wouldn't work because people would start to 'need' gas again. Also, if we were successful in lasting long enough to actually cause a price decrease (even just a couple cents), there would be plenty of people that would jump ship right away to get the new low price. This would just cause prices to go back to their normal state.

So, at this point, it's unlikely that we'll see any successful gas boycott. Our whole society needs to change its mindset before anything like this could ever work.

Postage for a standard first class letter went up to 41 cents today. Many people like to argue that postage increases, which appear to be frequent these days, are a result of email being so heavily used in place of the postal service. However, a quick look at historical postal rates show that this might not be completely true.

Prior to the 1970's, there hadn't been much more than a 1 or 2 cent increase per decade. But during the 70's there was a total increase of 9 cents, another 10 cent increase during the 1980's, 8 cents during the 90's, and 8 cents so far this decade. It appears that rate increases have been pretty rapid for the past 35 years.

I will agree that email is taking the place of many things that might have once been mailed via the post office. However, the data suggests that email may not be the primary driver to this increase. While some primitive versions of email emerged during the 1960's there was no massively connected network (i.e. the Internet) for people to use. So even though some high-tech people may have had some access to email, the concept of using this was completely foreign to "normal" people.

Obviously, email is HUGE these days, but perhaps it is taking away from the postal service less than we think. For me, it's not uncommon to send 10-20 emails a day. If there were no email, I would not be sending 10-20 letters via the post office no matter what the rates were. The reason is speed. Emails may only be 1-2 sentences long and the sender may expect an immediate reply. If using the postal service, you have to spend some more time thinking about everything you want communicated because a back-and-forth type of communication is unrealistic due to speed.

So what has driven the postal rates upward for 35 years? I'm not sure, but it seems likely that there is some primary driver other than email.

We live in a capitalist economy right? And capitalism is driven by competition amongst business. This competition forces businesses to perform better and to better meet their customers' expectations. So why is it that there seems to be an apparent lack of competition in some areas of business?

Take for instance doctors. While many doctors are driven by a need to help people, we must realize that they are in businesses too. Just as anyone in business, they need to make money to make it worth their while. However, to me, there doesn't seem to be much competition in this area. Most of the time you don't even know what you'll be paying for and how much you'll be paying. When you are sick, you go to the doctor's office and they perform their tests and diagnose (hopefully correctly) without ever mentioning how much it will cost. We are just expected to pay whatever comes up on our bill a few weeks later.

Suppose they tested you for an illness when there was a low probability that you had it. Also suppose that you'd be charged $50 for this test later on. Many people would probably opt out of having this test.

And there's also this feeling of being locked in to a certain doctor or clinic. We don't shop around. Obviously, in the medical world the cheapest provider might not always be the best but customer value is driven by many things. When I make a purchase for anything over a $100, I really like to shop around and make sure I'm getting the best value for my money. But with doctors we don't do this. We go to the same place we always go. They could charge us $100 or $500. We don't have any way of knowing until the bill comes.

Doctors should post their pricing for common procedures or maybe there should be a pricing index that would allow us to see which doctors are the priciest. Then we as consumers could make an educated decision on where to seek services based on price, customer service, and other areas of value to us.

Well gas prices went up another 18 cents a gallon in my area yesterday. That's a 6.1% increase in one day! This is prompting me to question why this product's pricing could be so volatile. How many other consumer products are out there that will go up 6% in one day and then maybe another 5% in two weeks? We buy other products that are traded as commodities and whose trading price changes daily, but those changes never really seem to be reflected in the end-price to the user. Somehow, those products are able to level their sales prices out so, as consumers, we don't see many changes. I mean how often do groceries go up in price? Maybe once a year or so. But you aren't expecting a 5% increase every time you go to the supermarket.

Unfortunately, there are so many differing views on the state of oil supply. Some people say there's tons of oil left while others say a lack of supply is driving prices higher. I wish I could find some real good statistics about exactly what is driving these price increases? How much of it is just oil companies raising prices because they know we'll pay for it?