28
Feb
11

Rising Cost of Energy

 

To the world's economy, and the people of Libya, stability is worth the uprising.

Rising energy costs impact all of us. Everything you buy has the need for transportation. Even the iphone application you downloaded required a programmer to get to work in the morning, and that took transportation of some kind.

Those rising costs mean a rise in prices for everything. In turn, that means demand for everything goes down. There is no more money available in the economy, yet the price of everything is rising. Necessarily, less is purchased.

We are in the transportation business. We have seen these costs rise before, and know the impact it has. It is that same experience that tells us not to panic. For one thing, these price spikes typically subside once a problematic event is resolved. Middle East uprisings, especially in Libya are chiefly responsible for the recent price increases. As dramatic as those events are, they will be short-lived, even if they go on for several months. When you compare the effects of these brief events with the long term-view that economies employ, you will see that in the long run, these events are mere interruptions.

In the mean time, materials still have to move. Those materials move most efficiently via cargo ships. What may have been sent via air, rail or truck before is more likely to go via ocean cargo if that is an option. Many will sacrifice speed in favor of costs. No matter the price to ship, ocean freight still moves most efficiently. We are all anxious for those costs to come down, and for our friends in trucking, rail and air to become more competitive again. They fill a different need than we do.

Advertisements

0 Responses to “Rising Cost of Energy”



  1. Leave a Comment

Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out / Change )

Twitter picture

You are commenting using your Twitter account. Log Out / Change )

Facebook photo

You are commenting using your Facebook account. Log Out / Change )

Google+ photo

You are commenting using your Google+ account. Log Out / Change )

Connecting to %s


Gain unearned income. Own shipping containers and lease them to us. We contract with companies who need to ship materials.

Twitter Updates


%d bloggers like this: