Mark Frydman's and Box Brothers Ecopnomic Stimulus Plan

I was doing some thinking today, as I reviewed some of our many transportation bills
that we incur in our business. They include weekly bills for United Parcel Service at all of our
locations, Federal Express and Federal Express Ground Package bills, again for all locations,
and now we have DHL and US Postal Service at all of our other locations, as well.

Then we have all of the LTL, Truckload, Air Services, Ocean Services bills, for all locations.

It is fair to say that we are loaded up on transportation services bills and they all have one thing
in common to my point in this blog entry: that all of these services have added on costs due to the high cost of gasoline or fuel.

Many of you may be surprised to learn that in LTL or less than truckload shipments, which a lot of small businesses use daily, there is a standard of a 20% fuel additive that is in addition to the normal line haul or cost for this service. Yes, so for a $300.00 shipment, that is now $360.00.
For a $500.00 shipment, that will now be $600.00.

For ground and air services from UPS and Federal Express, we have no real idea how much they
are charging us extra for fuel, as they have not only blended the rate for extra fuel costs directly into the charge for transportation, and then they add some more. My guess is that it is about
15% here, but you would need a whole room of accountants to figure it out. Gee, I wonder why they have worked so hard to hide this cost from the payor?

Short answer: Monopolies do as they please until they are told not to.

But in the case of the trucking industry, prices might rise if they were not able to pass on the 20% surcharge, as my guess is that most of the carriers never have made nets of 10%,
so a 20% drop in true revenue might force them to increase their prices, in order not to go out
of business, but the truth is that Fedex and UPS trucking still cannot make money in freight
even with this additive.

Why would the government allow this sizable increase to be passed on to small business? All we hear is that it is small business that does 75% of the hiring; it is small business that will lead us out of recession (did you hear that the recession ended 7/09, they said in 9/10, today) and it is
small business that is all good...........

so why are we getting hammered by the two monopolistic transportation carriers, UPS and FEDEX, who bought their way into LTL trucking a few years ago and who have led the industry down this path of 20% fuel surcharges?

If the government or the federal reserve used its assets to buy down the 10 year notes, the ones used for 30 year mortgage rates, and spent billions on these purchases--and I think it was a good idea--how come you do not have the cost of oil lowered to where it should be, not where the
speculative market would like it to be?????

I have heard that the demand price or true demand price of oil is around $60.00 a barrel, and
no one knows why it sells for 20-25% more than that, but if you simply follow the money
(heard that one before), you will see that the stock prices of the 4 major oil firms follows lockstep with the inflated price of oil.

I also believe that the government allows this to happen, as when the current President ran for office he said that this market, the oil futures market, allows unregistered trades, thereby increasing speculation in that market. Well, 20 months later, and it turns out to be lip service,
but I just cannot figure out why.

Imagine the boost this economy would have if the shipping prices came down 20% and the cost to fill up your car went down 20% or if your electricity bill went down 20% due to its linage to the cost of oil--how great a boost would that be?

I ask, and hopefully, not rhetorically, how come this cannot happen, that we get the price of oil
down to where it should be, and not what Mobil, Chevron and Shell want it to be for their own purposes--but Wait, there is more good news. Iran would get less money.........what would be wrong with that?

I will keep dreaming, and hoping for the best, but I am no fool, and hell will likely freeze over before this happens. After all, the oil firms must own that too....