[Winder]

Currency War? | The Big Picture

“Currency War” is the latest hot title. It’s now on the front pages, triggered by the policy change in Japan. In only two months the Japanese yen has weakened about 15% against the US dollar.

Will we see lower prices for Japanese products like cameras and lenses? Sigma and Fuji are still made in Japan.

[JinDesu]

Finally, I'll be able to afford a GT-R.

[monochrome]

Currency War? | The Big Picture

“Currency War” is the latest hot title. It’s now on the front pages, triggered by the policy change in Japan. In only two months the Japanese yen has weakened about 15% against the US dollar.

Will we see lower prices for Japanese products like cameras and lenses? Sigma and Fuji are still made in Japan.

JPY/USD has declined around 25% since September. We can't all repair our economies by exporting to the other guy. But some of us can.

[Winder]

JPY/USD has declined around 25% since September. We can't all repair our economies by exporting to the other guy. But some of us can.

The race to the bottom is underway..... Hopefully we get some cheaper camera gear out of it.

[causey]

Time for Pentax to release new products.

[reeftool]

I don't notice any prices dropping. It's funny how quickly prices can shoot up when the dollar drops but hardly change at all when it goes the other way.

[Tom S.]

I don't notice any prices dropping. It's funny how quickly prices can shoot up when the dollar drops but hardly change at all when it goes the other way.

Kind of like gas prices with crude oil prices, isn't it?

[Winder]

Kind of like gas prices with crude oil prices, isn't it?

Gas might be a little different.
Econbrowser: Dude, where's my cheap gas?

[Tom S.]

Gas might be a little different.
Econbrowser: Dude, where's my cheap gas?

Gas may be a little different, but diesel sure isn't.

A few months ago, gas prices dropped nearly $.60 a gallon around here, but diesel dropped $.20. Diesel, which requires less refining, costs more than gas. A few years back, the disparity between diesel and gas prices was blamed upon the US usage in Iraq. That has gone away, but the disparity remains. 15 or so years ago, gas was always more expensive than diesel, but not anymore. Ask any truck driver.

[Winder]

Gas may be a little different, but diesel sure isn't.

A few months ago, gas prices dropped nearly $.60 a gallon around here, but diesel dropped $.20. Diesel, which requires less refining, costs more than gas. A few years back, the disparity between diesel and gas prices was blamed upon the US usage in Iraq. That has gone away, but the disparity remains. 15 or so years ago, gas was always more expensive than diesel, but not anymore. Ask any truck driver.

The US military is still the single largest consumer of Diesel fuel. Diesel is more common in other countries than it is in the USA and the BRIC countries are still growing, which is putting more pressure on demand for Diesel than on gas. The low sulfur requirements we introduced in the USA really drove up the price, and this is not required in the developing countries. Growth in these countries puts more price pressure on diesel than on gas.

[Tom S.]

The US military is still the single largest consumer of Diesel fuel. Diesel is more common in other countries than it is in the USA and the BRIC countries are still growing, which is putting more pressure on demand for Diesel than on gas. The low sulfur requirements we introduced in the USA really drove up the price, and this is not required in the developing countries. Growth in these countries puts more price pressure on diesel than on gas.

Apparently it's not required in developed countries either, as I saw diesel cheaper than gas in GB last spring. Of course as the Brits would say, it was still bloody expensive!

[monochrome]

The federal insterstate highway system was built and is maintained primarily using federal taxes on the trucking industry. IOW they tax diesel much more heavily than they tax gasoline. Gasoline taxes are left up to the states, with which the states fund ALL state road construction and their portion of Federal Highway construction.

Want to pay less for motor fuels? Get them to remove the taxes and charge user fees for roads.

[Winder]

The federal insterstate highway system was built and is maintained primarily using federal taxes on the trucking industry. IOW they tax diesel much more heavily than they tax gasoline. Gasoline taxes are left up to the states, with which the states fund ALL state road construction and their portion of Federal Highway construction.

Want to pay less for motor fuels? Get them to remove the taxes and charge user fees for roads.

This is true, but just 15 years ago diesel was less expensive than gas. Diesel has always been taxed at a higher rate than gas, but it is only in the last 10+ years that it has become more expensive. Locally the difference in price is not accounted for by state taxes. I can't speak for other locations. There is a federal tax on gasoline.

The United States federal excise tax on gasoline is 18.4 cents per gallon and 24.4 cents per gallon for diesel fuel. Recently The Simpson-Bowles Commission, convened by President Obama in 2010, “called for an immediate 15 cent-per-gallon increase in the Federal gas tax”.

But none of this has anything to do with the value of the Yen and how it will effect camera prices.

[reeftool]

Diesel is more efficient so you get a lot more HP and torque per gallon. I would shudder to think of the fuel consumption if large trucks had to run on gasoline. Exchange rates affect fuel prices also since every developed country imports huge amounts of fuel and high energy costs can offset any savings in camera prices because it takes more Yen to buy a gallon of fuel to both manufacture and ship the product.

[Winder]

Diesel is more efficient so you get a lot more HP and torque per gallon. I would shudder to think of the fuel consumption if large trucks had to run on gasoline. Exchange rates affect fuel prices also since every developed country imports huge amounts of fuel and high energy costs can offset any savings in camera prices because it takes more Yen to buy a gallon of fuel to both manufacture and ship the product.

No doubt. I had a friend with a VW Jetta TD w/manual transmission who got 42mpg before they changed the sulfur content.

Exchange rates and inflation do play a role. in the 1950's a gallon of gasoline was around a quarter, but at that time the quarter was still made of silver and if that quarter was still made of silver it would still buy a gallon of gasoline. The value of the silver in a 1953 US quarter is over $5.00. 6.25 grams and 90% silver 10% copper. Since the creation of the FED the buying power of the dollar has fallen 94%.
InflationData: Cumulative Inflation by Decade
FED was created in 1913. It would be interesting to see how the YEN has performed relative to the US dollar over this period.