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Strategies & Market Trends : The Epic American Credit and Bond Bubble Laboratory -- Ignore unavailable to you. Want to Upgrade?

To: Ramsey Su who wrote (68523)	8/19/2006 8:04:40 PM
From: yard_man	Read Replies (3) \| Respond to of 110194

we could still be close to the peak in world oil production and have crude go to $30 -- demand also plays a role?? I don't think the world would be a terrible place with $45 oil. Are you saying it would be awful?? It would help reduce the cost of my commute. <g> I don't think crude in Indonesia, Venezuela or Nigeria requires such high prices as we have now -- it's not that marginal?? How many of the citizens are getting the trickle down now crude @ 70? I would bet very few ... isn't that what the kidnapping, unrest and gum-flapping is all about? I think what the lower price would imply is a recession here -- anticipation of reduced demand and a serious world-wide contraction. mid 50s might be consistent with a "super-tanker" slowdown -- slow motion recession. I just wonder if that is possible. I think energy stocks are discounting a bounce back to the 50's or 40's; 30's and there's going to be some serious technical damage to them. Only brave souls will be buying if that happens?? I would love such an oppty, but don't expect it ...

To: Ramsey Su who wrote (68523)	8/19/2006 10:47:58 PM
From: Wyätt Gwyön	Read Replies (1) \| Respond to of 110194

What is going to happen to struggling economies such as Indonesia, Nigeria? Indonesia is already a net oil importer, so lower prices will help them. in most exporters, oil is a curse that keeps kleptocrats in power. Norway is a notable exception. in general i think the world would benefit from lower oil prices, but i don't think it will happen for long without an exogenous shock such as bird flu. since the US consumes about 25% of global oil, it will be interesting to see what a severe US recession could do to global demand. i think places like Chindia will keep increasing imports regardless, but i don't know if it's enough to offset a severe demand decline in the US. does anybody know how much demand might contract in the US in a "reasonable" recession? i don't think the oil-shock-induced recessions of the 1970s can serve as a guide since we were specifically recoiling from higher oil prices. but demand has kept growing in the face of MUCH higher prices than anyone expected just two or three years ago. what kind of effect did the early 1990s and early 2000s recessions have on US demand--CR or anybody know?