The banks that might go under are small to middle-sized, regional banks, who made assumptions that oil would just go up, up, up. I think the economy
can weather the loss of these banks, if it managed to weather the "loss" of Bear, Stearns, Lehman Bros, WaMu, Merrill Lynch and Countrywide Funding.
If consumers have more dollars, then it is likely they will spend it on things that use steel; new cars, new appliances, etc., especially with how low
loan rates are becoming. I wouldnt worry about steel just yet.
Every major increase in gas prices (73, 79, 90, 07-08)has been accompanied by a substantial recession. I think it is logical to assume that a major
decrease in oil prices will be a good thing for the overall economy.
And it should be noted that gyrations in the stock market are not indicative of a bad economy. There is so much speculative money in the US stock
market that supply and demand of stocks can sometimes run counter to the supply and demand of goods and services.
I really think The Plan is to put money in the pockets of Americans and hope that we can spend the world out of its economic doldrums. If there's one
thing we Americans are good at, it's spending money.
Think of it as trickle UP economics. The middle class spends. We have to, to live.
It's in our DNA, I think.
[Edited on 1-19-2015 by Hook] |
