Money: The universal gift

The holiday season which just passed has reminded me of another issue which affects our lives. During Christmas, birthdays and other times, it is common to give gifts to people. On the other hand, for the Lunar New Year, at least in Chinese culture, it is common to give red pockets filled with money.

Sometimes the gifts received during birthdays and at Christmas time, while given warmheartedly, are not used by the recipient. On the other hand, if the recipient received money to the market value of the gifts, then they could go and buy something else that they really want. In this way, practically, money is usually the best "materialistic" gift. People would either be indifferent to receiving money over something which they were going to buy anyway (apart from the time and effort spent to buy it), but they would prefer money over something they would not have bought normally at the current prices. This is something I learned formally in Intermediate Microeconomics, although it's not something you need to study to know.

Of course, there are some exceptions. For instance, if the recipient of the gift does want something which the buyer has better access to, for instance being a member of an exclusive club or if they already go on an overseas trip to some country which has a particular gift at a cheaper price (or if it's the only place they sell something), then the gift itself would be better than the money used to buy it. But for most things, this is not the case.

It's funny how in birthday or Christmas celebrations it is sometimes seen as being lazy or unthoughtful to just give money. But practically, it can often be the best gift.

E10 unleaded: What to fill your rental car with just before returning it.

Our family doesn't fill up with petrol containing ethanol, even in our newest car which clearly indicates that it can withstand using E10 unleaded (10% ethanol). When the price difference is only a few cents per liter, it is not cost effective in terms of cents per kilometer, since ethanol has a lower energy density than normal petrol.

Credit: Wikipedia; Scott Dial http://en.wikipedia.org/wiki/File:Energy_density.svg

I recently went on a trip to Queensland though, and our family rented a car. Because the car had a label on the fuel intake saying it could use E20, I thought that maybe we should fill up with E10 with the last fill up just before returning the car, because it is a bit cheaper (in Australia, there aren't petrol stations which sell more than 10% ethanol mixed in). We didn't end up doing that though, since the petrol station we went to last didn't have E10 petrol.


Thinking about ethanol petrol also reminded me of another issue which I haven't talked about on this blog. Using ethanol is renewable unlike the stuff from crude oil. It is almost carbon neutral, and environmentally conscious people may deliberately choose E10 because of this, despite the lower mileage.

However, that is only one side of the story. When you look below the surface, with the current technology, using ethanol is not that great. I'm not talking about your car not coping; if it's a new one with the sticker on it, using ethanol up to the limit recommended should be fine. I'm talking about where the ethanol comes from.

Right now, a lot of the ethanol comes from fermentation of food products such as wheat. If more ethanol is used for running cars, this means there will be less food available, if agricultural production is not stepped up. Increasing demands for ethanol for fuel have caused flow on increases in prices of wheat, and have worsened food shortages around the world. There have been some experiments on converting waste products from plantations into ethanol using techniques such as genetic engineering of bacteria, but so far their use is not widespread.


In the future though, what will cars run on? It seems like electric vehicles are getting better and better, with advancements in battery technology happening all the time. Right now though, electric cars don't seem to have as much range as petrol cars, so they are inconvenient for long trips. Of course, using electricity won't be carbon neutral or sustainable in the long term if coal is used to generate the electricity. Solar electricity technology seems to be improving all the time though, so hopefully in the future it can make up a lot of our electricity needs together with wind without too much cost. Nuclear electricity seems OK for the countries which already have the infrastructure, although when things go wrong, the consequences can be quite hard to deal with.

.97 c

You know, every time I see a shop say something is on sale for .97 c, I feel tempted to check out 2 of those items for free since 1.94 c should round down to 0 as it is less than 2.5 c. And if they don't let me, to then give the shop attendant a lesson on decimal notation. Seriously, do some people who make the signs not know the difference between .97 c and 97 c? The first value is $0.0097 and the second is $0.97.

I once saw this as a price for one of Woolworths' reusable bags by the way.


On another note, it's good that the public transport fare issue has made its way to The Age. http://www.theage.com.au/national/education/end-of-the-line-on-cheap-fares-for-melbourne-uni-pioneers-20110301-1bd9d.html