Discussion in 'Economics' started by Banjo, Mar 23, 2020.
So, in contrast to that, a very high price of fuel - is a great sign for the economy ?
The fuel price, the lower it goes, (without the ,,virus''), the better it is for an ordinary folk. Isn't like that ?
Wouldn't write these question, just one thing, haven't found in article, a single - rational reason, why low fuel price is actually bad for an economy. If were talking about US.
Sure, but if you can’t drive anywhere, the cost of fuel becomes inconsequential to the average consumer.
I think, can't drive anywhere - is personal choice &
has nothing to do with the statement, of - low fuel price = bad for economy.
Maybe Venezuela or Soudi, but not US.
Folks should be loading up with gas instead of toilet paper
Exactly! Low fuel prices are good for the average consumer, and if you look at oil today, 1$ is actually a bit pricey considering all circumstances.
The economic damage required to get those gas prices down to where we are today more than offset the marginal savings that the consumer sees at the pump.
Low prices is an indicator that millions of people haven't got jobs anymore.
I disagree. Low prices of oil has no correlation with job employment numbers, rather economical and sovereign instability that affects the price of oil. You can see this with MBS and Putin, negotiating prices of oil with OPEC+. Right before that, the price of oil was stable, no employment was disrupted until the two oil nations came together to either raise the price of oil, or reduce it (MBS) for competition. In short, at times low oil prices can insinuate low job numbers, but that is not the case for many other scenarios.
It's not a linear situation though. On face value your statement is correct. Add in other factors like FED has been fighting deflation for decades and that we are a consumer based economy that relies on debt expansion. Than you start to realize low oil prices is not going to be a good thing. Yes, in other scenarios or situations it can be good, but fair, right or not that is not the reality of the situation we're in.
Agreed. It might have been a positive before our hyper financialized economy, but look at the current fallout from these low oil prices-the entire energy sector is in collapse (along with their debt). How many jobs will be shed from that sector alone? Nevermind the knock-on effects or the rest of the country/economy.
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