Oil prices cause anemic economic recovery

Looking at the uneven economic recovery in the US, you begin to understand how much the price of oil influences things. Wall Street seems happy, but for everyone else that has a tank to fill things are very different.

Connecting the Dots has been talking about this right along, and as time goes on people are beginning to see that there are several pillars that hold up the economy. They would be the price of oil, banking practices, and government oversight of corporate structure.

Supply and demand can not be manually overridden for any length of time without some negative fallout. Push prices up artificially and discretionary spending money is quickly sucked out leaving the economic engine without fuel. The price of oil has not been in line with market demand for several years, and that was a major contributor. With the magic tipping point of $100.00 per barrel, $80.00 per barrel oil leaves only 20% of that discretionary spending money to spend.

On that thought if energy were free, every cent of every dollar would be fueling the economy. And as it would be, energy is free less the cost of the equipment to collect it. Solar power and wind power are in abundance, and wind power looks to be increasing as global warming continues increasing storm sizes and changing weather patterns around the planet.

Even people that live along rivers and streams can purchase or make their own hydroelectric generators capturing the energy in the river. So just like the Internet and its concept of being decentralized, so must be the way of energy in the future to free the economy from the grip of the greedy who look to manipulate the market prices.

Meanwhile the government is doing its part to strengthen the other pillars by various methods of persuasion. It seems to be having some affect on the business men who still are connected with the rest of the world. The ones that have lost touch and are off in their own little world will require stronger methods.


3 Responses to Oil prices cause anemic economic recovery

  1. Ha Ha Ha,

    I can’t believe you even have the balls to write this BS.

    First of all, over a year ago, I educated you via your column about the perils of banking practices. At that time, you were publically stating that the banking practices had little or nothing to do with the state of the global economy; it was the cost of oil in your opinion. Now, you are stating that banking practices are one of the pillars and you have been stating this all along? Do you really believe people are that stupid that they just read your last article and think, “Man, this guy is a friggin genious!”

    Secondly, over a year ago, you stated that $50 per barrel oil was the tipping point. Again, I tried to educate you and show you analysis why the world could support $80 per barrel oil. Suddenly, over a year later, $100 oil becomes your tipping point.

    Finally, Solar and Wind Power are NOT in abundance. Sun may be in abundance. Wind may be in abundance, but the power of each are not even close to being in abundance until the infrastructure to support each can be built adequately. Those who choose wind power are currently paying a slight premium to traditional forms of energy. Studies show they are willing to pay the premium because of concerns about the environment.

    Keep up the good work genius! You crack me up!

  2. Avatar Susan B.
    Susan B. says:

    Hi Joe,
    You seemed to have missed the point of the post. What Richard is saying is very true at least in my household. I am a mother of 2 and my husband and I did not experience any job loss. But our free money is going into the tanks of our cars and that does limit extra spending that would feed the economy. I think this is the point he is trying to get across. I have been a long time reader and I also think you may have remembered wrong on some of you points. If you don’t mind can you link to the things you’re a citing.

    Susan B.

  3. Renewable energy is free but it is not a concentrated energy source. It will will be very difficult to fully replace the concentrated fossil fuel that we as a society have become very accustomed to.

    -Jeff.