Posted on 06/06/2008 7:13:25 AM PDT by ChildOfThe60s
NEW YORK (Fortune) -- High-flying tech stocks crashed. The roaring housing market crumbled. And oil, rest assured, will follow the same path down.
Not everyone agrees. In an echo of our most recent market frenzies, some experts pronounce that the "world has changed," and that the demand spikes, supply disruptions, and government bungling we face now will saddle us with a future of $4, $5 or even $10 a gallon gasoline.
But if you stick to basic economics, it's clear that the only question is when - not if - prices will succumb.
(Excerpt) Read more at money.cnn.com ...
“It’s not a bubble. Wishing won’t make it a bubble. The only way to make the price of oil go down is to replace it.”
There’s another way:
- Invade Saudi Arabia
- Toss out the sheiks (and Wahhabism along with them)
- Lower the cost of Ameri-Saudi oil at the wellhead to something more inline with what the _real_ cost of producing it there (I would guesstimate about $50 per barrel)
- Sell as much needed to fill the gap in American demand to guaranteed sources of supply to America first
- Sell the rest on the world market, but bypass commodities markets, with first choice to the Chinese (this would assauge their concerns about our control of the oilfields).
- Let the commodies speculators deal with the new reality of pricing.
The lifeblood of our economy is something which is indeed worth fighting about.
War for oil?
Of course!
- John
I'd like to see that as well. I'm not fond of the French, but nuclear energy is one thing they have done right. They have standardized their reactor designs and have promoted nuclear energy, and today France gets over half of it's energy from nuclear. I would be willing to drive an electric vehicle if it has the range I require and the ability to recharge in a reasonable period of time.
As to exploration of Mars, the cost would be a drop in the bucket compared to our GDP as well as our national budget. The spin-offs would drive future innovation, so I believe it is a no-brainer.
Your plan would most likely create a global nuclear war. No thanks.
“Your plan would most likely create a global nuclear war. No thanks.”
Someday, the West is going to have to deal with the Saudis and Wahabbism face-to-face anyway.
I’d prefer sooner than later.
War with whom? Be specific. The only threat is the Chinese, and they can be dealt with, one way or another. Are they going to wage war on their principal market?
- John
Even if the world price of crude oil goes down drastically, gasoline prices will stay high and go higher in the US as a result of new carbon taxes, windfall profits taxes on oil companies and the continued refusal to drill in the US or build new refineries.
It will happen with oil, it will happen with ag commodities also.
There’s so much cheap money in our economy that people can just throw it willy-nilly at whatever the current fad is. After the oil bubble pops it’ll be something else unless we adopt a responsible monetary policy.
No, no. Oil rose because of “fears” that Israel may strike Irans nuclear facilities. That’s all it takes these days, “fears”, not actual events, just “fears”.
True.
Another falacy was that the Jews were ‘liberated’ from the concentration camps and set free, when they were actually moved to other camps to prepare for integration. The Nazis that were taught to despise the Jews weren’t going to give that one up so easily.
Oh, boy!!! $100 per barrel oil and $3.10 gas prices. What a deal!!!
Reminiscent of the Tech Bubble when all the MSM were telling us that the business cycle has been eliminated and the old paradigms have been shattered. Dot coms were popping up all over the place with business plans that must have been written by third graders. Companies like Pets.com were selling dog food below their cost and paying the shipping and they claimed they were making money...Sooner or later reality sets in.
Not if O Bambi’s friends like Mr. Imadinnerjar and Cousin Hugo have anything to do about it. $200/bl is their goal. Last month both leased half the tankers and vessels to remain idle or just sit in the sea full of oil, which tied up transport logistics.
Evil genius, I say. But at $85,000/day quite expensive.
There will be NO bubble. $150bl by July.
Now, excuse me while I go raise my rates to reflect the upcoming hike.
What goes up must come down?
It seems to me that many of the refineries here in NJ have closed, although that may just be my impression. I couldn’t confirm by Googling. Refineries used to help give the air here its particular aroma and body. When I was growing up, we had air you could really sink your teeth into, not this thin clear stuff the kids breath today.
Did you read post 5 the one I was posting to? It is not about market prices but drilling and creation of new jobs, it is always helpful for one to read the post one is replying to.
It’s kind of interesting to me that with the tech or .com crash we have been on a kind of down hill hierarchical cycle Tech, housing and now oil. 4 or 5 years then boom and move to the next link on the chain.
Events are catering to the pessimist in me, I think we are on the last link.
Disclaimer: Opinions posted on Free Republic are those of the individual posters and do not necessarily represent the opinion of Free Republic or its management. All materials posted herein are protected by copyright law and the exemption for fair use of copyrighted works.