[OT] Gas companies report record profits (old energy thread)

Dennis devel at muhlesteins.com
Mon Jan 30 10:58:54 MST 2006


>
> Think of it this way: If you make 10% profit on a candybar that 
> retails for $1.00 and demand for that candy bar pushes the price to 
> $1.50, your profits are going to go up 50% as well. The oil companies 
> aren't taking a bigger slice of the piece, their slice is just worth 
> more money.
>
That is a pretty good way to think about it.  After the big debate last 
year, I read a few essays by economists who commented on the situation.  
A few argued against taking away the oil companies profit margin because 
they use that money to further invest in infrastructure that can deliver 
gas cheaper in the future.

-Dennis



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