Booms, Busts, and Recoveries Message Board

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Strategies & Market Trends : Booms, Busts, and Recoveries

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To: KyrosL who wrote (30255)	3/27/2003 1:47:18 PM
From: Hawkmoon	Read Replies (2) of 74559

It is not in the interest of Iraq to break OPEC. It is well known that a monopoly maximizes profits, so why should Iraq kill the golden goose? Because the golden goose is strangling the global economy. High energy prices translate directly to lower GDP growth around the world. Developing nations, more dependent upon fossil fuels, are required to spend an inordinant amount of GDP on energy... China is a clear case of this trend.. Lower prices, demand will rise because global economies will restart... But choke the global economy and no will be able to afford their oil... Besides, OPEC is nearly dead already. Iraq is merely the "stake in its heart".. Saudi Arabia can't afford to curtail production too much since it is in such tremendous debt (with little to show economically for it). Having little love for the Saudis, or the Wahabbists they protect, I have little problem seeing that country have to deal with its own internal economic crisis so it represents to the rest of the Muslim world that Theocratic regimes are no utopian solution to their economic and social problems. Hawk

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