Disagree.
“High-flying tech stocks crashed. The roaring housing market crumbled.”
Comparing the oil mkt to tech stocks and housing market is not a good comparison.
Oil is a supply/demand issue.
Developing nations are sucking up oil like never before and their usage will only increase as the rest of the world buys their goods and their economies grow.
Stagnant productions right now compared to growing demand.
In the future, demand will increase faster than production.
In this country, the EPA and leftist thinking and policies have restricted our ability to match our energy needs, by allowing no drilling, no new nuclear plant, no new refineries.
Unless there are radical change events on the horizon, oil will be more and more valuable.
I'm no economic extpert, its just MHO
The problem is that the big investment houses (Goldman Sachs) have been selling products (derivatives) will oil or oil futures as the underlying capital. They have been borrowing real capital to finance the purchases and selling them with the “promise” that as oil prices go up the value of the “investment” will rise. If anything reduces the value of the underlying “equity” (oil) there will be what is a de facto “margin call” and everyone will start dumping to cover their positions. That is what will be called a “panic” and there will be blood on the streets. What is needed is a statement that the U.S. Government will not come to the rescue of those who have chosen to play this game at the consumers expense and a tightening of regulations on how much real capital must be risked (as opposed to borrowed or “leveraged”) in making such transactions. The stage is set for a collapse. All that is needed is a spark to set it off. Think ENRON.