Are Low Oil Prices Good or Bad for the Economy?

[planosteve]

I know, let's ask the FED.

Fed's Yellen (12/17): "The decline we've seen in oil prices is likely to be, on net, a positive."

Fed's Yellen (02/18): "Persistently low oil prices could dampen the overall expansion of economic activity."

What a difference 2 months make...

[ralph]

I don't know other than the fact that low oil prices are good for me , my wife , kids and other individuals that use oil .

[Houston]

not to worry, they are taking care of it around here.
last 10 days from $1.89 per gallon to $2.29 !
9it stepped up bit by bit not all in one day)
is this just trying to help out the falling price economy
or line their pockets with profit
OR trying to make the talking heads correct when they say the prices are going to rise

[John in Plano]

both

Parts of corp America will be able to wring extra profits, some will not.

Layoffs in the oil patch will cause isolated/regional problems like they have in the past. This time new areas will be impacted and that will cause localized financial pain.

[planosteve]

If Yellen knew anything about economics she would have said it would have no effect on the economy. The gains and losses balance out.

[John in Plano]

bwaaaaaahaaaaaa

[glenn/dallas]

They are good for MY economy

[planosteve]

They are good for MY economy

Or maybe not. Do you have investments or a pension? Chances are some of not a lot of it is invested in oil stocks or bonds of oil companies or other industries that will be affected by the lower oil price. All businesses could be badly hurt by a bear market triggered by the decline of the oil investments. And then there are derivities market that would tank and take out a lot of the banking system.

[ralph]

I see things as Glenn sees things but you are probably correct Steve .

[GFB]

I know, let's ask the FED.

Fed's Yellen (12/17): "The decline we've seen in oil prices is likely to be, on net, a positive."

That's because a decline in oil prices from 90 to 100 dollars a barrel was a good thing.

Fed's Yellen (02/18): "Persistently low oil prices could dampen the overall expansion of economic activity."

What a difference 2 months make...

That's because it kept falling and falling..and that shocked a lot of people....

But it has now rebounded above $50, which, I understand is the marker that makes the difference for the newer American oil people.

[GFB]

To clarify..should have said..a decline from 90 or 100 dollars a barrel..(which is where we were not that long ago)..was a good thing.

[Kiamichi]

High prices for foreign oil are bad without any doubt.

[ralph]

think that its interesting that people are concerned with the economy and I think that its a fairly new concern . My Dad as example or Mom didn't worry about the economy . My DAD just went to work and as long as he went to work that work was the economy . He never invested except maybe 20 bucks a month in an investment club that he and few friends messed around with . My Dad would see low gas prices as a good thing for his personal situation . I think that the concern for the economy by regular people is rather recent , maybe 20 years old . I know that I never concerned myself with investing and stocks until my boss 'Mr. V' told me to get into the companies profit sharing and to also buy company stocks if I could .

[GFB]

think that its interesting that people are concerned with the economy and I think that its a fairly new concern . My Dad as example or Mom didn't worry about the economy . My DAD just went to work and as long as he went to work that work was the economy . He never invested except maybe 20 bucks a month in an investment club that he and few friends messed around with . My Dad would see low gas prices as a good thing for his personal situation . I think that the concern for the economy by regular people is rather recent , maybe 20 years old . I know that I never concerned myself with investing and stocks until my boss 'Mr. V' told me to get into the companies profit sharing and to also buy company stocks if I could .

My parents weren't even savers, nevermind investors.

I don't think they ever thought about investing in the stock market any time in their whole lives.it's just not what regular people did.

And all this information was not readily available for the average person to watch way back when.

[ralph]

thanks Greg , yeah you are correct about the availability of info but regular people like my Dad didn't need the info even if it had been available . And another thought is that people didn't spend money to keep the economy 'Growing' . I hear on the news that there is concern that with lower gas prices people are hoarding their savings rather than spending it in the economy as if that's anyones business other than the owner of the money . Another thing is that back when my Dad was working he was relying simply on a company pension for him and Mom . I think that it was GWB right after '9-11' that said , hey , you people keep spending to keep the economy growing and it continues to this day where Growth seems to be worshipped . To me , it just ain't normal or good !!

[GFB]

thanks Greg , yeah you are correct about the availability of info but regular people like my Dad didn't need the info even if it had been available . And another thought is that people didn't spend money to keep the economy 'Growing' . I hear on the news that there is concern that with lower gas prices people are hoarding their savings rather than spending it in the economy as if that's anyones business other than the owner of the money . Another thing is that back when my Dad was working he was relying simply on a company pension for him and Mom . I think that it was GWB right after '9-11' that said , hey , you people keep spending to keep the economy growing and it continues to this day where Growth seems to be worshipped . To me , it just ain't normal or good !!

70% of the economy is consumer spending.

...another thing no one had any way of measuring years ago.

[ralph]

yeah , but years ago everything was cool and gov minded its own business . Now all they / gov wants [seems] is growth of the country and economic growth and I don't think that that's good .

[GFB]

yeah , but years ago everything was cool and gov minded its own business . Now all they / gov wants [seems] is growth of the country and economic growth and I don't think that that's good .

I don't know why anyone would say that, Ralph.

If the economy isn't growing..it's shrinking..which equals recession.

[ralph]

because growth equals growing population as need for labor grows , I liked a country with 200 million like I knew it right around 1974 . Now census says 320 million 'about' not counting illegals .

[ralph]

USA was a pretty nice place with good living conditions since my birth to 1974 when I was a young adult and population was at the 200 million number [about] . Same thing for my parents who were born in the early 20s .