Mr Mortgage – Robbery Update…Originally Posted 5/19/08

Posted on June 1st, 2008 in Mr Mortgage's Personal Opinions/Research

They got me lookin’ guys.  I get up to the mountains within 15 miles our lake house and I realize I am on 1/8 tank, the baby needs to eat and wife has to use the bathroom. So, hey why not stop and fill up at my local Chevron, then I won’t have to on the way home. I can save time! Giddy-up.

It has been two weeks since I got hit upside the head with a whopping $100 partial diesel full-up and quite frankly forgot about the whole incident.  Link to 5/19 Post.

 I swipe the card and sit back inside the truck while my wife and kid do their thing. I put on my favorite Elvis CD and all of a sudden I hear the load clunk. I said ‘that was fast, maybe the pump handle slipped and it shut off’. Nope, not even close.

 I look up and there goes another hundy…$100 for a partial fill-up. HOWEVER, this time it was only 19.421 gallons, as the price went up to $5.149 per gallon from $4.949 per gallon two weeks ago. The fill-up cost about $80 2-3 weeks before that. Are you freaking kidding me! 20 CENTS PER GALLON IN TWO WEEKS and a buck in a month in a half! CONTINUED…

We are in serious trouble. For the remainder of the post I am just going to cut and paste my post from two weeks ago. Everything still applies. –Best Mr Mortgage


“Thank you Mr Bernanke is all that I can say.” Who else is there at which to point the finger?

We can talk about Asian and Indian growth, weak refining capacity in the US and geopolitical risk premiums all day long, but I am rate of change kind of guy. The massive rate of change in crude and gas prices are perfectly in-line with the dramatic cut in the Fed Funds Rate and subsequent significant weakening of the US dollar.

Some will say we have had artificially low prices for years and now are catching up to reality. Perhaps, but again the rate of change over such a short period of time is what is significant to me and likely most consumers.

To this mortgage insider and Wall Street outsider the following are what I have noticed have had the biggest rate of change since Bernanke started to ratchet down rates at the fastest pace in history after spending months in 2007, along with Hank Paulsen, denying a problem even existed.

-dollar crashing
-crude oil and gasoline rising
-food costs rising
-mortgage loan, credit card and auto loan defaults rising
-foreclosures rising
-banks Level 2 ‘assets’, Level 3 ‘assets’ and leverage rising
-stock holder equity shrinking
-the Fed’s balance sheet shrinking
-mortgage rates rising
-home values falling

and finally, since the last ‘shock and awe’ move on the day Bear Stearns collapsed…-stock prices rising of the very same handful of banks who invented the recent manifestation of structured finance that has blown up in the world’s face and that are now being rallied around by the financial press and Wall Street.

On the surface it sure looks like 300 million Americans and God knows how many billions of people globally, have been thrown under the bus to save a handful of alchemist banks who got us into this mess in the first place.

After seeing the $100 price tag for a partial fill, I actually joked about calling AAA, as whatever cost I incurred, in excess of the free towing that comes with my premium subscription, maybe cheaper than the next fill-up.

Perhaps $5 is not that shocking to some, but it sure caught my attention. Different folks will have different price trigger points but I think that the $5 price tag is psychologically significant. I spent the next hour after filling up talking about how what we need to do to reduce our personal gas consumption. -Best, Mr Mortgage


$100 Gas 5/19



18 Responses to “Mr Mortgage – Robbery Update…Originally Posted 5/19/08”

  1. I hear you. I hit I-5 this morning, not a lot traffic at all. I believe Americans gonna suffer years for the fruit of government tolerating US gready capitalists to move our manufacturing bases oversea for their maximum profits decades ago.

    What FED has been doing right now is just try to save Wall Street buddies by nationalizing government’s giant loss from stragetic globalization failure.

    Could be a great ooportunity for those who believe saving is a way for future security, though.

    Cash will be the KING, not credit cards.

  2. I just noticed that, near me, regular unleaded has gone from $3.99 to $4.25 – just in the last week. I suppose it may be a delayed reaction from the barrel price hitting $135… or their last ditch attempt to gouge us before this price spike retreats. I’m a long term oil bull, as prices will surely rise over the next few years, but this increase seems too high too fast. Other than currency devaluation, nothing on the demand side has changed dramatically in the last few months, save for maybe a recent demand *drop*.

  3. I am not going to get short oil until gold starts going where it should be. If oil retreats without gold going higher I am going to assume it is a headfake.

  4. Hey! Dear Americans. Have you noticed the riots in Europe ? If you think it’s bad in the USA, go see what is going on in the UK, Portugal, France and Italy.

  5. And Spain also.

  6. Mr. M – We are in “serious trouble” – I posted to a thread, a while back , asking the question – what about all of us who did not get crazy loans, etc. what will the default be on us /them when engery is too much to bear? I live in the north east, and use heating oil – ouch – this year I have to take my husband’s fall commission check and pull out enough to cover what I think could be $1,000 fill ups this winter – in the peak season we will fill about every three weeks or so (we keep our home at 68f, next year maybe 66f.)(certainly not boosting the economy in the retail sector – lol) We are lucky enough that we do okay, but what is our tipping point – what is the couple living on two teacher’s salaries tipping point? These people work, they are not looking to leach off a system. I realize you are doing pretty well, given your second home, large truck, etc, but obviously you are feeling it – what is your tipping point? At what price will you start spending less time at the lake house? How many more house fires will there be in the N.E. this winter from families trying to stay warm with faulty space heaters? How many more elderly people will we see dying, because they freeze alone in thier homes or stop taking medications – the social impact is staggering if you think of it – heck, it is a nice late afternoon here – I going to pour a glass of wine and pretend I don’t read this stuff – lol, hope you had nice weekend 🙂

  7. ha – I meant “bare” not “bear” (as in brown, black or Pooh), my bad. lol

  8. I like to do information trades, with others who have expertise. Anytime you like you can contact me by email, and I will give you my outlook and forecast as to what’s coming, the for the USA wrt to Energy. As a potential buyer of CA real estate in either 2009 or 2010, I would like to hear your views, further. My views are non-ideological, and not extreme. However, there is the issue of Geology which is largely behind what’s unfolded here, in global liquid fuel supplies.



  9. Evil-A Great points. I called up Slomins (Long Island oil company) to see the price of home heating oil 3 weeks ago, $4.39 a gallon. That’s about $1200 for 275 gallon tank. You must fill up at least 3 times a year. This winter will be painful for many if this trend continues or gets worse. Imagine $6 home heating oil, finally we will get riots.

  10. I am not going to get short oil until gold starts going where it should be. If oil retreats without gold going higher I am going to assume it is a headfake.

    Not sure I understand what you are saying. Gold seems to be following oil pretty closely now, in terms of daily up/downs – and often in the oppposite direction of equities. Seems like the commodity players moving in/out of those in tandem against the dow. Meanwhile the value of the dollar against other currencies has been stable or improving.

  11. My tipping point! Hahahaha. I made a fortune ripping doing hundreds of millions of exotic loans over the past 6 years. I dont have one. HAHAHAHAHA.

    While I was smarter than the average mortgage hack, I am beyond my tipping point. We have downsized huge. I sold all rentals except one in 2005. I have my primary house and a lake house but guess what??? My parents bought the land 37 years ago for $3500 and my brother and I split the cost of the buildjob so this is as free of a vacation home as you can get.

    We go to costco for almost everything and I bought a refer for the garage to store up.

    I have a diesel because I thought I was being good. This truck will last 20 years and it does get great gas milage for a 6.6 liter 4×4.

    So, driving 250 miles roundtrip to come to the lake house on weekends is my big extravagance. I can tell you one thing for sure the average Joe and above Joe is at or beyond their tipping points now. Every since their HELOC was cut off.

  12. Hey there is no recession. If Washington and the fascist Labour Department says so, there is no tipping point and no reccession. Tipping point: that is the critical point that you attain, when you cannot even give a tip to the waiter at the restaurant, let alone go to the restaurant. No tipping please. 🙂

  13. Mike, fill up 3 times a year? I wish! LOL….I do about 1,500 gals from oct. to april (200 gal tank in my house) One will breath the sigh of releif in april when you know you can sit on that fill until at least late july, anyway, don’t feel bad for me, (and I did not think you were), I am just worried over all, and thanks for gettin’ my point.

    Mr. M – no disrespect here as far as your lake house, etc, if I remember well on your last post re: gas prices you got hit pretty hard by people saying “you must be rich, big truck, lake house yadda, yadda,) I did not do that (not lookin’ for a bullie prize either) I just meant, right now you can do the trip, when do say, “hey hon’ let’s stay home this weekend” – trust me dude – I feel the pain 🙂 I am not here to ride you, I love your info. MY Bigger question was what is the tipping point over all? If one makes over six figures at 125k what is that family’s tipping point, what is it a 175k? kinda like we all have a price at which we can be bought….ya know? Btw- I shop like you all – i have figured out alot about “sales” cycles in markets – I do always say to my husband “when this economy starts really hitting the wine budget, then I will be really mad”, not even expensive stuff at that ….lol


  14. One more thing mr. m – and I agree helocs being cut off…but jeeze I don’t have one – and we do make 6 fig. and darn I am pinched….I totally get the helocs argument of how much trouble we are in for – but more trouble for even more – do you get what i mean?

  15. I just saw your video on foreclosures…. good job!!! You’re good looking too 🙂

    Thanks for all that you do.

  16. good thing about those who have helocs is they are mostly unsecurred and I think that is where the first big round of ‘a’ paper principal reduction will come from.

  17. When we bomb Iran this summer the price of oil will hit $10 in California.

    If you Californian pagans do not vote McCain this year will ensure the price continues to $20.

    You want cheap gas? Simple, support your local GOP.

  18. Mr. M.:

    Buy a Honda and leave the boat at the lake house.

    Mr. GMC

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