Now that gas is under $2.00 a gal. I've heard folks on the radio talking about the great deal they recieved on their Superduty pick-ups.
Now that propane is $1.49/gal folks want to know why they should bother spending 20K on a geo system. Did anyone else notice a shrinking of activity on this site?
Now that our new president wants to tax fossil fuels folks wonder about the benefit of all electric heating.
3-4 hundred percent efficient saves money no matter what. Period.
Regardless of your politics, we know that we will see a lot of tinkering with money and energy costs.
Since all other things will be equal, geo will still be the most affordable (in terms of operating cost) heating system, no matter how high the fossil tax. While air source air conditioners come close, if you still have any heating requirement geo still wins.
The new administration's policy of throwing money at our economy can only cause the dollar to shrink in value world wide. That will raise the price of NG, propane and oil.
Geo wins.
Hope everyone else sees it.

As a side note about oil prices as they relate to drilling. The govt. controlled the price of oil for a long time to give us a readily available economical fuel. The past debacle was their experiment with deregulation of those controls, prices went through the roof. During that time the amount of siesmic drilling in this country boooommmmed again, looking for oil. As of 30 days ago that industry /siesmic/ has collapsed. All of the rigs and personel are back in moth balls. That tells me that the people paying for the siesmic work have been assured that controls are being put back in place to make exploration not worth the trouble again.
This is a constant repeating cycle.
However most people in my area are wanting off the oil and propane train no matter what the cost, because the last two winters bills will not soon be forgotten.

Some people have amazingly short memories and attention span. Now that energy costs are low, some are going back to the same old habits, despite claims they wouldn't. Rest assured, another price spike in coming in the future, those of us that prepare now will be in a far better position than the fools who don't. I am re-assured some what that people are learning, the re-sale value of SUV's and large trucks is still low. The thought process is people don't want to be stuck with them when prices spike again. The real test will be when the economy recovers, and oil prices stay low, weather American's love affair with SUV's will begin again.  

The Activity on the site has dropped off a cliff, I hardly check it now a days, very few questions and fewer new posters.   

Joe ~ I am confused by what you are saying here.  I don't know what this means:

"Now that our new president wants to tax fossil fuels folks wonder what the benefit of all electric heating" 

Could you explain?

I agree wholeheartedly that geo provides the greatest efficiency in heat centric climates, and I try to share my experience with everyone that I can, so this is not meant to be confrontational.

I also agree that some people have not learned from our overconsumption flaws and ramifications.  In my opinion, you can relate every aspect of this "crisis" to overconsumption.  Whether it be fuel, money, homes, food, etc.  So, it makes me feel like this crisis is supposed to be a lesson learned and some people are just not learning!

As far as our dollar shrinking, the past 8-10 weeks have shown the first signs since 2001 of our dollar NOT losing value compared to the euro and in terms of "trade-weighted exchange rate."  To give you the numbers, in terms of the trade-weighted exchange rate, the value of the american dollar was approx. 110 in 2001, throughout the past 8 years it has consistently and slowly declined to approx 76, we are now holding steady for the first time and actually seeing a slight (but not notable) increase.  Furthermore, the value of the dollar, as compared to the euro, has been creeping up in the past couple of months.  (rather than declining as it has been) 

I know that these are not the great leaps that we have become accustomed to in the past 20 years or so, but the fact that the decline is slowing and perhaps even leveling gives one cause to feel optimistic. 

I would wager the value of the Dollar has declined because the govt has been printing it faster (because they have been spending it faster than ever) than the rest of the world wants to buy the stuff. Good for exports but oil is priced in Dollars worldwide and the Chinese wan is pegged to the dollar. Recent increases in the dollar have more to do with speculation on how bad the rest of the world will be effected by this economy and little to do with how good the US is doing. 'Flight to quality'.
Now our new govt wants to increase the currency printing speed from fast to unbelievable. The Chinese own trillions of Dollars of US debt- treasury bills, bonds, notes. If they just buy at a pace that they have been over the last 8 years we are going to have a very big problem trying to unload the rest. Anyone remember Jimmy Carter? 14% mortgage rates, stagflation, ya the good old days.

Ona,
I'm not offended by the question. I'm often thinking faster than I type.
2 things inspired the comment you are asking about.
1) a report that our government wants to buy back a trillion in bonds (presumably by printing money).
2) the expectation that new administration will tax fossils (as promised).
My feeling (poorly articulated) was that printing of more currency will cause dollar to fall in value (causing offshore purchased fuels to climb in price), while stateside taxation of fossils will cause a rise in energy costs. Geo will clearly still trump, but average Joes (pun intended) are asking if increase in electric rates (from coal plants) will affect ROI.
Hope I did better this try :)
J

There is a very big difference between the creation of wealth, banks lending money and collecting interest from businesses or individuals who in turn use the money to keep people working, and the govt printing money and adding it to the economy. The only way for the govt to buy the bonds is to use current foreign reserves, use a current balance held in reserve(currently 0)or print money.
It is not just the people losing faith in the system it is the purchasers of the debt that loose faith and demand a higher rate of return for the risk of taking on the debt.
All of this support, tax breaks, for installing solar, geo, etc. has to be paid for by someone. I am not in the 'rich' category so my income taxes for now will not be effected (but the FICA is sure to go up).
I sure want to take advantage of it before the pols decide to cut it off. But in the long run we will all pay in higher prices for all of the goods and services we use. Every business is going to be passing the extra new taxes and fees and carbon trading cost on to the consumer.
So, instead of just raising everyone's taxes to pay the new and better cost of govt we have a great show of cutting taxes but shifting the burden to 'rich', non working families and big business.
Why not be more transparent about it? Raise the tax on gasoline and diesel the way the europeans do, the more you use the more you pay. My decision to buy the type of vehicle I want. CAFE standards are far less effective than the rising cost of fuel to get people out of larger vehicles.
Raise the tax on NG, raise the tax on electric produced by fossil fuels. Require all new construction and renovation to meet strict energy codes. People will get the idea quick enough.
But when you manipulate the value of the dollar, commodity prices will rise and fall in a random manner. Who can plan for that?
Geo is still the best choice for long term savings and comfort but all of America will be paying 30% of my cost to install it when I can afford to pay the initial price.

"taxing big business" is the epitome of politician Bull#@%&
Anyone who thinks that companies simply choose to shrink their margin (vs pass along cost of new taxes) needs a reality check.
The other thing that gets me is regional and perhaps personnal. The notion that auto workers recieve 80 or 100K/yr is ridiculous. That the largest employers in the world are unworthy of assisstants due to employee compensation is more political BS and class warfare.
True economics and common sense would tell us that the best economic stimulous package would be to pay a bunch of unskilled rubes 100K/yr. As the saying goes "a fool and his money...."
Cutting the pay of labor is the opposite of stimulus as the "working man" will no longer be buying consumables.
J

Yes and no
The creation and distribution of currency in this country is done though the banks . The keys to the printing press is held by the FED which is no more federal then federal express . The FED owned by 5-7 of the largest banks prints money . So when a bank lends money it doesn't really have it is creating money out of thin air .
The government ( get this ) has to buy its own money ( and pays more for the money then face value ) basically how it works is the goverment needs some money so they go to the treasury the treasury prints up a bunch of bonds or notes and takes them to the FED ( a group a private banks mind you ) and trades the notes for the currency . Some times its 1 for 1 but very rarely , so now the goverment has some money the problem is that note that they sold can be redeemed for more money then the goverment got for it in the first place . Clearly not a money making venture . The real question is as long as the goverment is creating money this way could we ever be out of debt .

"If people found out how the banking system really worked there would be rioting in the streets tomorrow"
-Henry Ford

This is why the only real controll the goverment has over inflation is to pressure the FED to increase the interest on there NEW money the reality is that the President has no real power to effect interest rates , or the inflation it effects . compared to this the goverment spending is much less important
In fact even with the goverment spending money as fast as they can its still less new money being created then any of the past 5 years .
this thread should be changed to Fiat Nation

Banks can not create money out of thin air. They are required to maintain a specific reserve by law. They lend money from the pool of assets people and business keep at the bank. The money in your savings account is being loaned to some one or business. They pay the bank a lending fee and interest on that money and you get interest on your account. A bit more complicated.
To think the Fed is a private bank is ... Well, it is not private it is a quasi govt institution and there have been very few times in its history when the Fed did not do the bidding of the President. All of the governors of the Fed are appointed by the President. They do make money by loaning money to banks and doing govt business which some they keep in reserve and most enters the federal general fund spent by congress.
The fed holds auctions for the bills, notes and bonds at a predetermined interest rate.. The auction sets the price for that day ( discount rate).
The auction price rises and falls ( the interest rate or discount) depending on how much interest there is in the sale. The sale is open to anyone with the money foreign or domestic.
So, the govt gets it money but like you and me must pay interest and a sellers fee ( think origination fee on a mortgage).
One of the reasons for this system is to prevent the govt from just turning on the printing presses and flooding the economy with money ala Argentina or Italy before the Euro.
The fed can only control the interest rate it charges for loans it makes to banks.
The market controls the cost of money through the open auctions held by the fed.
So, if the debt of the country is perceived to be safer than other available assets, ie german debt etc, the bid price will be near par. If the money sees a better opportunity else where the bid will be lower. But, the money has to come from some where and for the past 6 years that some where is china.
The govt spends more than it takes in, borrows money at a currently low rate, pays for its budget plus the interest on the debt. This puts the govt in the position of always needing increasing revenue to keep up or some big pool of money willing to continuously loan it out. All of that money on loan or coming from increasing taxes would do a lot better if it was busy directly in the economy. The multiplier effect of federal money is less than 1 for the country as a whole. Each dollar of govt spending returns less than 1 dollar of turn over in the market.
So, how by increasing spending and paying interest to foreign debtors the cost of inflation will not be effected? We can only hope that every other country is worse off than we are.
Our new govt has decided to increase the budget over its already blotted size and spend an extra 800 billion, and that is just this year. So, first we quadruple the budget and then magically cut it in half and say we are reducing the deficit. Sorry, 5trillion+20 trillion/2 does not equal 2.5 trillion dollars. Bush was a spend thrift no doubt, among other things. But even the congressional budget office ( controlled by the party in power) does not believe our new pres's numbers. I do not want the country to enter another jimmy carter style recession. I was there, once should be enough. But check the facts before you believe the political rhetoric.
I am going to take every advantage of the new energy tax credits that I can, personally they are great but for the country foolish. There are far better ways to get people to use less energy. But that is the current political reality.
Sorry for the rant. But I had to do it.

I just hope folks spend their "credits" with me so I'll have the dough to pay my "big business" taxes.
This is a political/class warfare argument.
The reality is that the big guys pass the expense on to us Liliputians (little people) and money don't come from air.
J

If money doesn't come from thin air it is backed by a pre set amount of metal ours doesn't
Both you guys need to learn about the fractional banking system and how money is created .
To think the FED is even close to a goverment anything . It frankly isn't congress has 0 power over it
the president can not dictate interest rates . The reality is that the small percent ( very small ) of our fiat money actually exists anywhere but on a computer . created by a private bank because they held 10% of that amount in reserve and all the other banks got together to honor each others notes. Why do you think 6% of the country defaults and it almost collapsed us , because that 6% actually represented 60% of what was real .
The FED does make money on the sale of NEW money ( except coins still done by the treasury )
They are PRIVATELY owned the "Chairman" is appointed by the board of governors of the FED the the exception and ONLY exception of REGAN appointed the architect of our current failure Greeenspan .Its tough to swallow I know and please dont take my word for it look it up or dont , because we do need some lemmings to make it work

Not sure how we came to this but when I mentioned that money "don't" come from air it was in the context of we "the little people" having to foot the bill for all of this stimulous.
J

Good heavens. A primer: A guy named Lew Ranieri had the brilliant idea back in the '70s to package pools of mortgages and use them to sell bonds by passing through interest and repaid principal. By 2007, this "nonbank" banking system provided 40 percent of the world's credit, packaging car loans, student loans, credit card receivables, commercial loans ... you name it. This was real money to the folks who bought the bonds, so when the subprime business blew up, 40 percent of global credit literally dried up overnight. Real banks were also funneling loans into this Wall Street money machine with an added twist. They were also parking surplus deposit money in these very same bonds. That means that banks are effectively sidelined, too, because regulators require them to reprice their securities holdings to what the market actually pays for them, which is not much these days if these bonds can be sold at all. When you hear of banks being seized, bad loans are only half the problem. The other half is securities holdings that have shrank to the point that they are no longer sufficient to support loan portfolios.
So that's where we are. The credit markets will be squeaky tight until investors figure out what these bonds are worth, and banks and investors take their beating and move on. Oil will remain cheap because the global economy will be bumping along on the bottom.
Now you can blame lots of people for getting us in this mess, starting with old Lew. But let's follow the money instead. Your corrupt mortgage broker, who lent money to anyone with a pulse, officially claimed a half percentage point. (I say officially because it's easy to slip a thumb on the scale.) Your greedy investment banker, who stuck investors with trillions in bad paper, got 2 percentage points. Joe Homeowner got the rest, turning his home equity into a backyard deck, a remodeled kitchen, a brace of Hummers, a tradeup to McMansionville -- assets that don't look so good these days either. So, in addition to banks who won't lend, we have millions of consumers who won't borrow until they get enough cash in the bank to replace the cushion they once had in home equity and 401(k) accounts.
If this sounds grim, you're getting the picture. Yes, the Fed is printing tons of money. Who do you think is keeping the doors open at Fannie and Freddie? Yes, the govt is spending tons of money it doesn't have to prime the pump, including handsome credits for GSHPs. Is this potentially harmful long term? Yes. Is there an alternative? Well, is there?

Not a fan of any argument that suggests a harmful choice "just because". One option as always is to let things run their natural course, but that of course begs the question where do we draw that line (bank bail-outs, auto maker loans....).
The biggest problem I see with the current "stimulus" efforts is that a proportional amount of pork is thrown on top as well. Our current elected officials feel they have a mandate to spend money we don't have by the trillion.
I just can't help recalling an old saying (loosely quoted) "the end of a society is when people can vote themselves a free lunch." I don't have any answers either, but I know I'm not spending my kids' college fund, on a bad plan, until I come up with a better idea.
J

Just because? Can you imagine what the housing market would look like if the Bush Administration had let Fannie and Freddie fail?
Anyway, I am glad to see you are finally awake. Too bad you weren't paying attention when Tom Delay was telling lobbyists that their industries wouldn't find a place at the trough unless they supported Republican candidates exclusively. As we can see, government by checkbook didn't out worked out that well in the financial industry.
Since we're both free agents, we don't have to wait for a honest politician of either party. How about I pledge not to seek any tax credits in the construction of my new home and you pledge not to do business with homeowners who aren't also willing to pay their own way?

To be clear, the Fed, acting as bond investor of last resort, has said it will buy $1.25 trillion of Fannie Mae and Freddie Mac bonds, making the Fed pretty much the only reason that mortgage money is inexpensive and available today.
Personally, I see the recent upsurge in mortgage activity as a blip: an opportunity for blue-chip homeowners to lower monthly expenses through refinancing and blue-chip, first-time buyers to crack homeownership. I suspect that gunshy, overextended homeowners are the ultimate problem long term.
But I can make the arguments as well as the next guy. We got into this mess through indiscriminate turnings of spigots; the Fed's job is to take away the punch bowl rather than refill it; buying bonds is blatantly inflationary because borrowers use money the Fed prints up. Of course, if anyone listens, the construction industry is dead for the foreseeable future.

Finding an honest politician would be a real feat indeed. But then 'honest politician' is an oxymoron.