How to reduce petrol and gas price..Egg logic

SENT TO ME BY A FRIEND:

A man eats two eggs each morning for breakfast. When he goes to the grocery store he pays 60 cents a dozen. Since a dozen eggs won't last a weekhe normally buys two dozens at a time. One day while buying eggs he notices that the price has risen to 72 cents. The next time he buys groceries, eggs are 76 cents a dozen.

When asked to explain the price of eggs the store owner says, 'The price has gone up and I have to raise my price accordingly'. This store buys 100 dozen eggs a day. He checked around for a better price and all the distributorshave raised their prices. The distributors have begun to buy from the huge egg farms. The small egg farms have been driven out of business. The huge eggfarms sell 100,000 dozen eggs a day to distributors. With no competition, they can setthe price as they see fit. The distributors then have to raise their prices to t hegrocery stores. And on and on and on.

As the man kept buying eggs the price kept going up. He saw the big egg trucks delivering 100 dozen eggs each day. Nothing changed there. He checked out the huge egg farms and found they were selling 100,000 dozen eggs to thedistributors daily. Nothing had changed but the price of eggs.

Then week before Thanksgiving the price of eggs shot up to $1.00 a dozen. Again he asked the grocery owner why and was told, 'Cakes and baking forthe holiday'. The huge egg farmers know there will be a lot of baking going on andmore eggs will be used. Hence, the price of eggs goes up. Expect the samething at Christmas and other times when family cooking, baking happen.

This pattern continues until the price of eggs is 2.00 a dozen. The man says, ' There must be something we can do about the price of eggs'. He starts talking to all the people in his town and they decide tostop buying eggs. This didn't work because everyone needed eggs.

Finally, the man suggested only buying what you need. He ate 2 eggsa day. On the way home from work he would stop at the grocery and buy two eggs. Everyone in town started buying 2 or 3 eggs a day.

The grocery store owner began complaining that he had too many eggsin his cooler. He told the distributor that he didn't need any eggs. Maybe wouldn't need any all week. The distributor had eggs piling up at his warehouse. He told thehuge egg farms that he didn't have any room for eggs would not need any for at least two weeks.

At the egg farm, the chickens just kept on laying eggs. To relieve the pressure, the huge egg farm told the distributor that they could buy the eggs at a lower price. The distributor said, ' I don't have the room for the eggs even if they were free'.

The distributor told the grocery store owner that he would lower the price of the eggs if the store would start buying again. The grocery store owner said, 'I don't have room for more eggs. Thecustomers are only buying 2 or 3 eggs at a time. Now if you were to drop the price of eggs back down to the original price, the customers would start buying by the dozen again'.

The distributors sent that proposal to the huge egg farmers but theegg farmers liked the price they were getting for their eggs but, those chickens just kept on laying. Finally, the egg farmers lowered the price of their eggs. But only a few cents. The customers still bought 2 or 3 eggs at a time. They said, 'when the price of eggs gets down to where it was before, we will start buying by the dozen.'

Slowly the price of eggs started dropping. The distributors had toslash their prices to make room for the eggs coming from the egg farmers. The egg farmers cut their prices because the distributors wouldn't buy at a higher price than they were selling eggs for. Anyway, they had fullwarehouses and wouldn't need eggs for quite a while. And those chickens kept on laying.
Eventually, the egg farmers cut their prices because they were throwing away eggs they couldn't sell.

The distributors started buying again because the eggs were priced to where the stores could afford to sell them at the lower price. And the customers starting buying by the dozen again.

Now, transpose this analogy to the gasoline industry. What if everyone only bought $10.00 worth of gas each time they pulledto the pump? The dealer's tanks would stay semi full all the time. Thedealers wouldn't have room for the gas coming from the huge tank farms. The tank farmswouldn't have room for the gas coming from the refining plants. And therefining plants wouldn't have room for the oil being off loaded from the hugetankers coming from the oil fiends.

Just $10.00 each time you buy gas. Don't fill it up. You may have to stop for gas twice a week but, the price should come down. Think about it.

As an added note...When I buy $10.00 worth of gas that leaves my tanka little under quarter full. The way prices are jumping around, you can buygas for $2.65 a gallon and then the next morning it can be $2.15. If you have yourtank full of $2.65 gas you don't have room for the $2.15 gas.

You might not understand the economics of only buying two eggs at atime but, you can't buy cheaper gas if your tank is full of the high priced stuff. Also, don't buy anything else at the gas station; don't give the many more of your hard earned money than what you spend on gas, until the prices comedown.' Just think of this concept for a while.

Avoid high charges of investment-linked plans

Hi Sir,
May I know if these plans are good or not? (details of plans provided)

REPLY
I suspect that the charges are high and take away a large part of your savings and potential returns.

Read this FAQ:
http://www.tankinlian.com/faq/ilp.html

And my blog:
http://tankinlian.blogspot.com/2008/07/benefit-illustration-for-investment.html

Avoid policies with high terminal bonus

An independent financial adviser shared this view with me. Most insurance plans now have a high terminal bonus that is not guaranteed.

He finds it difficult to recommend this plan, as the policyholder can not be sure if he will get a fair return on the policy. The percentage of terminal bonus vary from one policy to another. The policyholder may wonder why some other policies are given a higher terminal bonus than his policy.

He has decided that he will not sell any life insurance policy. He prefers to sell unit trust, as it is more transparent and fair to the policyholder, and more flexible.

I agree with his views. It is best for the consumer to avoid all life insurance policies with high terminal bonus, unless the cash and maturity payouts are required to follow the "asset share" method, as adopted in Malaysia.