Falling Oil And A Strong Dollar Will Bring More Pain

[AdvancingTime]

Not everything happens at the speed of light, often a time-lag exist such as the gap between seeing and hearing the lightning bolt. Some of what we see occurring in the financial markets and the economy should be viewed with this in mind. Only during a panic does it become obvious that a precarious situation has been allowed to develop.

We should remember two issues are in play that have yet to fully impact both our day to day economy and markets these are the strong dollar and falling oil prices. It is important to realize that markets have lost their ability to discover fair market value and no longer reflect honest or real value. The article below delves deeper into this subject.

http://brucewilds.blogspot.com/2015/05/the-great-time-lag-effect.html

 

[initforme]

I hope the price of oil falls until its 50 cents a barrel. Would be fun to watch.

 

[JakeStarkey]

Energy is in new ground. The last five great breaks recovered within six months. We are not even back to $70 yet, so where bottom is no one knows yet.

 

[initforme]

Let's hope it keeps on falling.

 

[william the wie]

Let's hope it keeps on falling.

So returns on automation increasing relative to labor at a much faster pace to reduce employment is good?

 

[initforme]

IF gas is high you bitch about it. If its low you bitch about it. What is the right price?

 

[EdwardBaiamonte]

these are the strong dollar and falling oil prices.

only a liberal would argue that falling prices are bad!! Maybe we should outlaw automated production so prices will be high again and everyone will be poor again!!

 

[JakeStarkey]

If we followed EB's economic theories that he has plastered all over the internet, our national poverty would increase world poverty by 10%.

 

[Pksimon2007]

Not everything happens at the speed of light, often a time-lag exist such as the gap between seeing and hearing the lightning bolt. Some of what we see occurring in the financial markets and the economy should be viewed with this in mind. Only during a panic does it become obvious that a precarious situation has been allowed to develop.

We should remember two issues are in play that have yet to fully impact both our day to day economy and markets these are the strong dollar and falling oil prices. It is important to realize that markets have lost their ability to discover fair market value and no longer reflect honest or real value. The article below delves deeper into this subject.

http://brucewilds.blogspot.com/2015/05/the-great-time-lag-effect.html

- In the article, the author claims that "artificially low" interest rates are a driver of this malaise.

That's an important premise. What should the interest rate be, and how do we know what it should be?

 

[Pksimon2007]

these are the strong dollar and falling oil prices.

only a liberal would argue that falling prices are bad!! Maybe we should outlaw automated production so prices will be high again and everyone will be poor again!!

- Oil is a commodity. "Automated production" produces manufactured goods.

Only a libertarian would confuse the two.

 

[william the wie]

these are the strong dollar and falling oil prices.

only a liberal would argue that falling prices are bad!! Maybe we should outlaw automated production so prices will be high again and everyone will be poor again!!

- Oil is a commodity. "Automated production" produces manufactured goods.

Only a libertarian would confuse the two.

these are the strong dollar and falling oil prices.

only a liberal would argue that falling prices are bad!! Maybe we should outlaw automated production so prices will be high again and everyone will be poor again!!

- Oil is a commodity. "Automated production" produces manufactured goods.

Only a libertarian would confuse the two.

It also applies to mining of which oil/gas drilling is a part. At this point most coalfields are future gas fields so energy prices should fall much faster.

 

[AdvancingTime]

In response to the question by Pksimon2007 as to "What should the interest rate be, and how do we know what it should be?"

I contend the rate of interest should reflect a reasonable return on the value of the money loaned by the saver or investor after taking risk and inflation into consideration.

 

[william the wie]

In response to the question by Pksimon2007 as to "What should the interest rate be, and how do we know what it should be?"

I contend the rate of interest should reflect a reasonable return on the value of the money loaned by the saver or investor after taking risk and inflation into consideration.

Hopefully this will not get too technical but the returns on borrowing to invest went negative in the 90s and has stayed there. With negative capital efficiency you and all other lenders and borrowers are screwed.