Posted on 03/30/2015 8:04:10 AM PDT by SeekAndFind
The crash in oil prices is hammering the Texas economy.
The latest manufacturing outlook index from the Dallas Fed plunged again in March, to -17.4 from -11.2 in February, indicating deteriorating business conditions in the state.
Expectations were for the index to show a reading of -9.
But the big most important part of this report is the commentary from Texas business leaders, who have given an on-the-ground picture of how the decline in oil prices is impacting one of the country's most oil-related economies. In March, the tune didn't change, as it sounds like things are still tough in Texas.
One executive in the fabricated metal manufacturing sector said: "Our oil and gas customers have just stopped producing. This is not an unusual event for our oil and gas customers, but what feels different about this time is no one knows when production will restart. Typically, we have to ride out 60–90 days, and this one looks like six months or more."
In the same sector, an executive said, "Much of our business is tied to oil. We are now entering what will probably (hopefully?) be the low point of the market. Our expected improvement for business six months from now reflects not a return to 2014, but a slow recovery from March–May 2015."
From the machinery manufacturing sector, one executive said they expect the price of oil to fall below $40 a barrel, causing "reduced sales of our capital equipment in the oil field."
Out of the electrical equipment, appliance, and component manufacturing sector, one executive said, "The drop in oil prices has severely hurt our business since we sell a sizable amount of capital goods to that industry."
And even away from direct impacts from oil prices, the commentary from Texas isn't all that encouraging.
(Excerpt) Read more at businessinsider.com ...
This is a deliberate strategy by Obama to hurt the economies of conservative states.
Looks like you're right.
It looks like Texas is about to repeat the brutal oil depression of the mid 1980s. After hearing those stories, I wouldn’t wish that on anybody — but here it comes again. Poor Texans. They are in for another economic bloodbath.
No it is not. The last Texas oil depression was under Ronald Reagan. This is just feast and famine in the oil industry. It won’t last forever and another Texas oil boom will be on the horizon. This is just business life in the unfree modern marketplace.
Hopefully won't last as long as the last crash.
How? How did Obama cause the decline in oil prices?
He must have encouraged fracking, and shouted ‘Drill, baby, drill!’
Or was that some other candidate from 2008?
RE: This is just feast and famine in the oil industry.
How many percent of the Texas economy is dependent on the price of oil anyway?
My impression is the state’s economy is DIVERSIFIED enough today compared to the days of oil dependency.
I lived in Midland the last time. There were some bumper stickers that read, “last person to leave Midland please turn out the lights”.
Even though Obama likes to take credit for cheap gas, he did not cause the falling price of oil.
back then 87’ “Pet. E s “ after grauduatin were asking
what you wanted w/ those fries.
Yep, and geologists were mowing lawns. No lie, my family knew some.
I live in the Dallas area and we are booming. Home values continue to increase as there is not enough housing to keep up with major companies relocating here.
You would think after decades and decades the “oil industry” would have figured out how to ride the up and down of the price. Technology has had to reduce cost.
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