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Boom Goes The Dynamite: The Crashing Price Of Oil Is Going To Rip The Global Economy To Shreds

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Boom Goes The Dynamite - Public DomainIf you were waiting for a “black swan event” to come along and devastate the global economy, you don’t have to wait any longer.  As I write this, the price of U.S. oil is sitting at $45.76 a barrel.  It has fallen by more than 60 dollars a barrel since June.  There is only one other time in history when we have seen anything like this happen before.  That was in 2008, just prior to the worst financial crisis since the Great Depression.  But following the financial crisis of 2008, the price of oil rebounded fairly rapidly.  As you will see below, there are very strong reasons to believe that it will not happen this time.  And the longer the price of oil stays this low, the worse our problems are going to get.  At a price of less than $50 a barrel, it is just a matter of time before we see a huge wave of energy company bankruptcies, massive job losses, a junk bond crash followed by a stock market crash, and a crisis in commodity derivatives unlike anything that we have ever seen before.  So let’s hope that a very unlikely miracle happens and the price of oil rebounds substantially in the months ahead.  Because if not, the price of oil is going to absolutely rip the global economy to shreds.

What amazes me is that there are still many economic “experts” in the mainstream media that are proclaiming that the collapse in the price of oil is going to be a good thing for the U.S. economy.

The only precedent that we can compare the current crash to is the oil price collapse of 2008.  You can see both crashes on the chart below…

Price Of Oil Since 2006

If rapidly falling oil prices are good economic news, that collapse should have pushed the U.S. economy into overdrive.

But that didn’t happen, did it?  Instead, we plunged into the deepest recession that we have seen since the Great Depression.

And unless there is a miracle rebound in the price of oil now, we are going to experience something similar this time.

Already, we are seeing oil rigs shut down at a staggering pace.  The following is from Bloomberg

U.S. oil drillers laid down the most rigs in the fourth quarter since 2009. And things are about to get much worse.

The rig count fell by 93 in the three months through Dec. 26, and lost another 17 last week, Baker Hughes Inc. data show. About 200 more will be idled over the next quarter as U.S. oil explorers make good on their promises to curb spending, according to Moody’s Corp.

But that was just the beginning of the carnage.  61 more oil rigs shut down last week alone, and hundreds more are being projected to shut down in the months ahead.

For those that cannot connect the dots, that is going to translate into the loss of large numbers of good paying jobs.  Just check out what is happening in Texas

A few days ago, Helmerich & Payne, announced that it would idle 50 more drilling rigs in February, after having already idled 11 rigs. Each rig accounts for about 100 jobs. This will cut its shale drilling activities by 20%. The other two large drillers, Nabors Industries and Patterson-UTI Energy are on a similar program. All three combined are “likely to cut approximately 15,000 jobs out of the 50,000 people they currently employ,” said Oilpro Managing Director Joseph Triepke.

Unfortunately, this crisis will not just be localized to states such as Texas.  There are tens of thousands of small and mid-size firms that will be affected.  The following is from a recent CNBC report

More than 20,000 small and midsize firms drive the “hydrocarbon revolution” in the U.S. that has helped the oil and gas industry thrive in recent years, and they produce more than 75 percent of the nation’s oil and gas output, according to the Manhattan Institute for Policy Research’s February 2014 Power & Growth Initiative Report. The Manhattan Institute is a conservative think tank in New York City.

A sustained decline in prices could lead to layoffs at these firms, say experts. “The energy industry has been one of the job-growth areas leading us out of the recession,” said Chad Mabry, a Houston-based analyst in the energy and natural resources research department of boutique investment bank MLV & Co. in New York City. “In 2015, that changes in this price environment,” he said. “We’re probably going to see some job losses on a fairy significant scale if this keeps up.”

If the price of oil makes a major comeback, the carnage will ultimately not be that bad.

But if it stays at this level or keeps going down for an extended period of time, it is inevitable that a whole bunch of those firms will go bankrupt and their debt will go bad.

That would mean a junk bond crash unlike anything that Wall Street has ever experienced.

And as I have written about previously, a stock market crash almost always follows a junk bond crash.

These are things that happened during the last financial crisis and that are repeating again right in front of our eyes.

Another thing that happened in 2008 that is happening again is a crash in industrial commodity prices.

At this point, industrial commodity prices have hit a 12 year low.  I am talking about industrial commodities such as copper, iron ore, steel and aluminum.  This is a huge sign that global economic activity is slowing down and that big trouble is on the way.

So what is driving this?  The following excerpt from a recent Zero Hedge article gives us a clue…

Globally there are over $9 trillion worth of borrowed US Dollars in the financial system. When you borrow in US Dollars, you are effectively SHORTING the US Dollar.

Which means that when the US Dollar rallies, your returns implode regardless of where you invested the borrowed money (another currency, stocks, oil, infrastructure projects, derivatives).

Take a look at commodities. Globally, there are over $22 TRILLION worth of derivatives trades involving commodities. ALL of these were at risk of blowing up if the US Dollar rallied.

Unfortunately, starting in mid-2014, it did in a big way.

This move in the US Dollar imploded those derivatives trades. If you want an explanation for why commodities are crashing (aside from the fact the global economy is slowing) this is it.

Once again, much of this could be avoided if the price of oil starts going back up substantially.

Unfortunately, that does not appear likely.  In fact, many of the big banks are projecting that it could go even lower

Goldman Sachs, CitiGroup, Societe General and Commerzbank are among the latest investment banks to reduce crude oil price estimates, and without production cuts, there appears to be more room for lower prices.

“We’re going to keep on going lower,” says industry analyst Brian Milne of energy manager Schneider Electric. “Even with fresher new lows, there’s still more downside.”

OPEC could stabilize global oil prices with a single announcement, but so far OPEC has refused to do this.  Many believe that the OPEC countries actually want the price of oil to fall for competitive reasons…

Representatives of Saudi Arabia, the United Arab Emirates and Kuwait stressed a dozen times in the past six weeks that the group won’t curb output to halt the biggest drop in crude since 2008. Qatar’s estimate for the global oversupply is among the biggest of any producing country. These countries actually want — and are achieving — further price declines as part of an attempt to hasten cutbacks by U.S. shale drillers, according to Barclays Plc and Commerzbank AG.

The oil producing countries in the Middle East seem to be settling in for the long haul.  In fact, one prominent Saudi prince made headlines all over the world this week when he said that “I’m sure we’re never going to see $100 anymore.”

Never is a very strong word.

Could there be such a massive worldwide oil glut going on right now that the price of oil will never get that high again?

Well, without a doubt there is a huge amount of unsold oil floating around out there at the moment.

It has gotten so bad that some big trading companies are actually hiring supertankers to store large quantities of unsold crude oil at sea…

Some of the world’s largest oil traders have this week hired supertankers to store crude at sea, marking a milestone in the build-up of the global glut.

Trading firms including Vitol, Trafiguraand energy major Shell have all booked crude tankers for up to 12 months, freight brokers and shipping sources told Reuters.

They said the flurry of long-term bookings was unusual and suggested traders could use the vessels to store excess crude at sea until prices rebound, repeating a popular 2009 trading gambit when prices last crashed.

The fundamentals for the price of oil are so much worse than they were back in 2008.

We could potentially be looking at sub-$50 oil for an extended period of time.

If that is indeed the case, there will be catastrophic damage to the global economy and to the global financial system.

So hold on to your hats, because it looks like we are going to be in for quite a bumpy ride in 2015.

  • Kim


    • Guest

      Yea go cry

  • Jenny

    Bumpy ride? Same old story.
    Yes may be bumpy but no reset or collapse.

    • alan

      Yep, slow slide downward. Oil companies will get bail outs and everything will be fine.

    • jox

      I disagree. In 2008 perhaps, but in 2015 central banks have not tools left.

  • Kim

    The tragedy here, IMO, is the devistation to the local enconomies. All those restaraunts, retail shops, you name it, all those places will shutter leaving further employment gaps in these towns and small cities. Ugh :-(. Prepare, pray and endure.

    • K

      You see things with great clarity. Normally lower gas prices would be a good thing. But with the greater numbers of the unemployed. This will be the exception to the rule. Especially because even though fuel has been down for quite some time. Prices in the grocery store have not dropped one penny.

      • Mondobeyondo

        You would think grocery items would go down, at least just a bit, because the cost of transporting those items is falling…

        • SkySavage

          No one cuts prices on finished goods until forced via competition.

        • K

          Yes you would. So once again, another rigged market.

      • laura m.

        Lower gas prices are great for retirees and other people on lower incomes. Yet food prices, mainly meat items, are going up. The retail in my area is ok except Sears just closed after sixty years and I expect to see K mart close as these stores are old and in poor locations, with bad customer service.

    • alan

      The weak ones will close, the few that make it will probably do OK. Its kind of like the last one standing is king more or less.

      • Kim

        Yeah I agree. It will be exactly like that. In fact that’s what upsets me so much. I feel bad for these local and regional banks and the local economies that went out on a limb. These people will suffer enormously.

    • Bobloblaw67

      It isnt like that hasnt happened before Midland/Odessa was a ghost town in 1986-88

  • K

    The price will go down, and stay down. Until all the shale companies shut down. Then watch as mid-east money quietly buys them up, at 10 cents on the dollar. To make sure they never open again. It could not be more obvious.

    • VigilanteCaregiver

      Very likely, if Russia hasn’t attacked ’em by then.

      • Mike Smithy

        True. If I were Putin, I would use a proxy such as Iran to attack Saudi’s oil production capabilities.

        • alan

          Yep, I agree.
          Or someone will launch an attack and blame someone else, like the Ukrainians shooting down MH17.

          • Fred Grindle

            Which Ukrainians? Kiev or western U?

          • Fred Grindle

            My error— Kiev or eastern U?

          • Gay Veteran


          • Fred Grindle

            I’m confused. If Kiev shot down the airliner, why did the eastern rebels refuse to allow reporters and crash investigators to examine the crash site? It seems to me that if Kiev did the deed, the eastern rebels would willingly allow any authority/organization in to look for clues. Instead they would not allow any organization in for weeks. It appears that the eastern rebels were the perpetrators
            covering up the deed. Logic would dictate that Kiev is blameless and the eastern rebels are the shooters.

          • Gay Veteran

            yes you are confused. Logic?

            Cui bono means literally “to whose benefit?”
            did it benefit the rebels? NO
            did it benefit Russia? NO
            did it benefit the neo-Nazi backed coup government in Kiev? YES

            and the area you’re talking about was a war zone

          • Fred Grindle

            Of course it was a war zone. Russia and the rebels made it one. As for the rest of your incoherent ramblings they have been
            addressed in my response below.

          • Gay Veteran

            well Einstein, let’s see, a neo-Nazi coup seizes power from a democratically elected government, passes laws aimed at the Russian speaking populace of eastern Ukraine who decide they are not going to tolerate a neo-Nazi government and then said neo-Nazi government starts to murder them.
            and you blame them?!?!?!?

          • Gay Veteran

            and more importantly is where is the evidence? what happened to the air traffic control conversations with the plane?
            and interesting how the corporate media immediately blamed Russia
            but then the anti-Russian propaganda has been going on since before the Olympics

          • Fred Grindle

            Interesting how you dodge the issue. Indeed, where is the evidence? There was no evidence left after the rebels blocked the outside world from investigating.. your rebels would not answer any question asked of them. They prevented any investigation. They took the bodies. They took the plane wreckage.They took the flight recorders. You do a poor job of addressing my questions. You obviously don’t intend in using logic at all. Your mission is to cover up what happened. Answer this question—Why did the rebels prevent the world from access to the crash site? Can you give an honest answer. I don’t think you are capable. You sir, are part of the cover up as evidenced by you to answer simply and truthfully.

          • Gay Veteran

            what happened to the Air Traffic Control recordings?
            did the rebels get that too?

          • Gay Veteran

            a Canadian-Ukrainian monitor for the Organization for Security and Cooperation in Europe (OSCE), Michael Bociurkiw—one of the first investigators to arrive at the crash site. Speaking to the Canadian Broadcasting Corporation on July 29, Bociurkiw said: “There have been two or three pieces of fuselage that have been really pockmarked with what almost looks like machine gun fire; very, very strong machine gun fire.”

          • Gay Veteran

            why don’t you try thinking for yourself instead of buying the corporate propaganda?

            hate to burst your bubble:

            Flight 17 Shoot-Down Scenario Shifts
            August 3, 2014
            By Robert Parry

            Contrary to the Obama administration’s public claims blaming eastern Ukrainian rebels and Russia for the shoot-down of Malaysia Airlines Flight 17, some U.S. intelligence analysts have concluded that the rebels and Russia were likely not at fault and that it appears Ukrainian government forces were to blame, according to a source briefed on these findings.

            This judgment – at odds with what President Barack Obama and Secretary of State John Kerry have expressed publicly – is based largely on the absence of U.S. government evidence that Russia supplied the rebels with a Buk anti-aircraft missile system that would be needed to hit a civilian jetliner flying at 33,000 feet, said the source, who spoke on condition of anonymity.

            Despite U.S. spy satellites positioned over eastern Ukraine, U.S. intelligence agencies have released no images of a Buk system being transferred by Russians to rebel control, shipped into Ukraine, deployed into firing position and then being taken back to Russia. Though the Obama administration has released other images of Ukraine taken by U.S. spy satellites, the absence of any photos of a rebel-controlled Buk missile battery has been the dog not barking in the strident case that Official Washington has made in blaming the rebels and Russia for the July 17 shoot-down that killed 298 people…..

          • Gay Veteran

            “…They took the flight recorders….”

            Odd you mention the flight recorders. Guess you didn’t know that last July the rebels turned over the flight recorders.
            what happened to them?
            why haven’t the recordings been released?
            why hasn’t an independent investigation been conducted?

            but keep swallowing that corporate media propaganda

          • Fred Grindle

            You tell me It was
            your rebel thugs that kept everyone one from examining the crash site not the Kiev govt.

          • Gay Veteran

            Last July the rebels turned over the flight recorders.
            what happened to them?
            why haven’t the recordings been released?
            why hasn’t an independent investigation been conducted?

            but keep swallowing that corporate media propaganda

          • Bobloblaw67

            The plane was shot down by Russian supported rebels. If Ukraine shot the plane down, we wouldnt see the first people on the scene being Ukraine rebels.

          • Bobloblaw67

            I know this is a lunatic blog if people think it was Ukrainwe that shot down MH17

        • VigilanteCaregiver

          And Iran would need a proxy to carry out the attacks (Islamic terrorists groups).

          • alan

            Make one up…, Islamic State in Saudi Arabia, they attack oil wells and oil tankers.

        • T.

          There will be NO war over there anywhere at all. This is all about destroying the $ and the U.S. Financially. P.S. – Smithy do you remember about 6 weeks ago where I said Ebola would be back after the Christmas shopping season? Well, today a Ft. Hood soldier who had recently returned from duty in “West Africa” was found DEAD – Off Post near his home. So far – They have not reported the cause of his death – I’ll give you 3 guesses what it will be. I told you that Obola would have work to do for his newly appointed Ebola Czar after Americans “spent” for Christmas. Ebola is Back.

        • BuckJohnson

          Russia has a plan and it’s very crafty. He wants to hit us where it hurts and also at the time of his choosing.

      • K

        Russia would like to attack Saudi, no doubt. But a great deal of Saudi oil, goes to China. Might not be wise to cut the oil supply to your main ally.

        • VigilanteCaregiver

          Exactly, but I don’t think China would mind if they get control of the oil fields in the long run. That’s if Russia can supply enough oil for the red army to carry out attacks.

          Russia provides the resources; China supplies the soldiers seems to be the outward appearance. Remember the Art of War: all warfare is based on deception.

          Putin is not capable of taking on the West yet; population cannot support such an effort (they’re giving married couples a special day off work to procreate!) China, despite the claims of strength, wealth, and industrial might; cannot seem to operate independently and a much greater inflated currency problem than we do. All of that “Made in China” stuff is really just assembled or packaged there. The products they do make on their own are usually toxic and/or very bad quality.

          • K

            Perhaps, but occupying Saudi, would be the ultimate quagmire. A so called infidel force controlling Mecca, and Medina. The entire Muslim world, would yell Jihad. Not to mention most of the rest of the world, would not be too happy either. I think China, and Russia are smarter than that. Also notice China is very busy in the South China sea. Building bases and airstrips. In the short term going after those contested islands, seems to be a priority.

          • VigilanteCaregiver

            Good points. Sorry, I’m not focused on this right now; our Church is helping me go back to university this week – get a degree and a work-from-home job. Really busy right now, and if this works my family will finally be on our feet!

            So, I’m also posting a lot less often now; probably come back between semesters or days off.

            Thanks, K!

          • K

            Nothing to be sorry about. As usual, your priorities are in the right place. May God bless you, and your family.

          • Gay Veteran

            “…Putin is not capable of taking on the West yet….”

            Russia is defending itself. The U.S. sponsored coup in Ukraine is as stupid as a Russian sponsored coup in Mexico.

          • Fred Grindle

            you seem to have a habit of using various threads to pick fights with people. I doubt that you are either gay or a veteran. This moniker is used as a way for you to make snarky comments and accuse other posters of prejudice. You are one of those feeble minded rubes who troll the web starting arguments with people to satisfy your sick need for a cheap thrill and conflict.

          • Gay Veteran

            project much?

            btw junior, I’m not the one spreading government propaganda, YOU are

          • Fred Grindle

            I’m done with you, you fraudulent bum. You are a fraud just baiting other posters into arguments. You really never answer a question, you just bring up more fraudulent lies to attempt to support an answer to explain why your eastern rebels seized the plane, the voice recorders and the bodies. You never do explain it , you just change the subject to confuse the issue. I can only hope that other posters see you as the fraud you are.

          • Gay Veteran

            hey Einstein, I can’t explain it because I don’t know why it happened. unlike you who believes the corporate media propaganda.

            “…You really never answer a question….”

            HYPOCRITE. I pointed out that they turned over the flight recorders! YOU refuse to answer WHAT happened to them? and WHY haven’t the recordings been released? and WHY hasn’t there been an independent investigation?

          • Gay Veteran

            TPTB are pushing for at least a new cold war in Europe, and maybe even a hot war. I suspect that you are a troll paid to push propaganda on the unsuspecting.

          • Gay Veteran

            “you seem to have a habit of using various threads to pick fights with people….”

            by “pick fights” you mean countering propaganda or seriously uninformed comments

        • alan

          Russia might be ok with it. Its going to cause the US a lot of pain. Russia’s economy can probably handle it a little better than ours. Our petrodollar will take a hit, oil jobs will take a hit.

  • T.

    This is all orchestrated by the Globalists – Economic collapse of dollar and The United States of America 2015. They will not be denied. The Western Dollar Centric FINANCIAL System will be brought “Crashing” down this year. The U.S. $ will suffer a huge Devaluation in its value. The America that we and the world knows today – Will be no more by the end of this year.

    • thewatcher

      They want to also destroy the bricks at the same time before they can get their alternative system of the ground

      • Da_Neutral_Observer

        WANT is the operative word. So the energy industry will suffer. Jobs are being lost in that sector, and there’s no doubt we are headed for another recession. But America’s economy is more diverse than that. The collapse of the dollar will not destroy the USA in 2015. People can adopt a multi-national currency without losing their identity as a country. Is Germany, France, Spain or Italy not German, French, Spanish or Italian because they use the “Euro”?!

        So stop with this doomsday scenario. We are NOT going to be eating other human beings for survival in the near future.

        • Genada

          It maybe not doomsday but the results are going to be rather different this time imo.

          The US economy produces far less then it consumes. Oil has been the one bright spot during this recovery. The ending of this is going to be rather bad and people may not take too well to this all and it could lead to great social problems.

          The American people have suffered threw this “recovery” for seven years, most of which has been out and out lies. Now that they have been told that it’s the time they are suppose to get there due and suppose to get what they have coming to them, it crashes. People are not going to handle this well.

    • Hammerstrike

      But if this goes on, the collapse will happen before September 2015.

      • T.

        The “Collapse” will increase with intensity each month as more systems break and more financial instruments fail and more companies go bankrupt. Along side “All” of this the Globalists will introduce “Terrorist” attacks upon U.S. – Just as They did in Paris. Perhaps They have a really Big Grand Finale “Terrorist” event planned for “September 13, 2015”. That is my guess for These demonic possessed Globalist. Be sure of this – They have a Script and a Plan – None of These events are happening accident.

        • alan

          I’m going with a series of mini collapses, each one papered and propagandized over.

          • T.

            The one Big thing that readers and writers here don’t understand is this – The “Collapse” is already under way. When oil went under $60 the Shale Oil Junk Bonds and Derivatives (more than $500 billion worth) started to FAIL. All of these Financial instruments are Interconnected World Wide. But oil did not stop going down but has continued much lower to around $45, so even more THINGS have broken. As long as OIL stays below $50 – ALL those Junk Bonds & Derivatives will “Blow Up”. BUT, That is not all. They will set off a CONTAGION to Other Bonds & Derivatives that will FAIL, which will in turn cause many Businesses and Financial Institutions and BANKS to FAIL World Wide. It takes TIME for these Failures to appear to the Public – But the “Collapse” IS UNDER WAY AT THIS MOMENT AND WILL CONTINUE WITH OIL UNDER $50. It will INTENSIFY with each passing Month.

    • Bruce

      I agree our system will collapse. However, not because of so called globalist. It will be brought down by the greed of mankind itself. Why would “globalist” want to destroy a system that has brought them unbelievable wealth? You don’t kill a golden goose you feed it and take great care of it. To blame this on so called “Globalist” makes no sence to me.

      • T.

        Why is a good question. My answer is this – They are

      • T.

        Bruce did you read my reply? I started it but interrupted at first. Thanks

  • Kel

    Michael, the global leaders have held things together amazingly thus far – do you really think things could be as bad as 2008 this year? Hard to imagine given they always pick the markets up with huge rallies after a correction each and every time over the past 7 years

    • Guest

      The Dow Jones peaked in October 2007 and then fell more than 50% over the next 17 months. The Fed reinflated U.S. equity markets through several rounds of QE, printing trillions of dollars to buy Treasury bonds and MBS from banks. If we have a similar crash this year, I don’t know how The Powers That Be will respond. How can the Fed create several trillion more dollars without a complete loss of confidence in the dollar? We know stocks are in a bubble and totally disconnected from economic reality. But how much longer can they keep stocks from correcting? It’s hard to say. I’m surprised they’ve kept the bubble inflated this long. We’ll just have to wait and see.

  • Bill

    Dropping oil prices are bringing an inflated economy back to reality.

  • GSOB

    Leave it to the Lord and everything will be alright.

    The mandated ACA is more destructive to our economy then this business in the global oil market, ….which I hear will stay low in the US throughout 2015.

    Will see.

  • GSOB

    Denver Broncos got their butts kicked.

    Time to start fresh.

    • Guest

      So? That’s completely irrelevant to the topic of this article. But that’s typical of you.

      • GSOB


        At least you are paying attention and keep coming back,…… so why should it even matter to you what I blog?
        To me, it’s all related.
        To you it ain’t.
        Go fly a kite./ While I’ll exercise my will to type what I want.

        That’s typical of me….. I’m free.

        • Guest

          I keep coming back? What’s that supposed to mean? I’ve been reading this site since 2009. I come here because I love Michael’s writing. Like Michael, I’m a Christian.

    • Leave it to Beaver

      They were too stoned.

  • guest

    At the time of the Arab oil embargo of 1973 oil was in limited supply. All of the industrialized nations were importing oil. The U.S. cut the deal with the Saudis and those other feudal sharia monarchies in the Persian Gulf to make the dollar an oil backed currency instead of a gold backed currency in return for providing them with security . Michael, if the dollar was still a gold backed currency and suddenly gold strikes started occurring all over the place and the world was awash in gold what would happen to that gold backed dollar? .

  • DJohn1

    All because we are paying the lowest price in recent history for gasoline? Sounds like an anti-trust action to me. But that was a local boy pulled that to get a monopoly on gasoline in the early years of the 20th century. Standard Oil would move into a town and undercut the price until it broke the local dealers, then set the price up.
    The Rockefellers worked within the rules of the time. Only no one knew that the rules allowed such tricks.
    Even after they broke up Standard Oil with anti-trust, the Rockefellers were wealthy beyond anyone’s imagination of the time.
    International rules are not local rules.
    If there is a crash then we will all be hurting pretty bad.
    The last time was in Germany when the currency collapsed and Hitler came to power.
    What has to happen here is we have to get our economy back on track. To do that is going to take a lot of changes.
    Right now we are feeding China.
    Right now India is competing with our local labor on an economy that is not even near the one we have with millions of people competing for jobs. So a whole lot of jobs are going overseas.
    We cannot compete with that.
    So we have to have businesses that understand that and laws that keep it from happening.
    We are not the only people that will be ruined by this kind of financial junk. Even the rich get hurt if the dollar goes down the tubes.
    If you don’t think so, read up on the history of Great Britain after world war II. Read about the word nationalization.
    We have to take care of America first. The rest will fall into line.

  • JayC777

    Low oil isn’t causing the crashes. It’s just a precursor. In 2008 they didn’t start to drop until mid-July and by this time the market was already in deep doodoo. The huge rise and fall in prices of oil are just a symptom of much greater systemic problems.

    • smallergovnow


      • JayC777

        Really???? You have got to be kidding me. QE, artifically low interest rates, over regulation, derivatives, welfare state, social security bankrupt, medicare/medicaid bankrupt, more debt than actual worth, etc. I’m in shock that someone would actually ask this question.

    • Bobloblaw67

      They are the sympton of dolalr fluctuations and supply and demand

  • Jim Clark

    Chicken Little time.

    • Boom Boom

      Boom Boom Mancini

  • Yaroslav

    Will this lead to deflation or inflation? I don’t use banks so if it’s deflation, I’ll benefit right?

    • Mike Smithy

      I suspect this deflationary collapse will lead to a weaker dollar and a likely end of the petro-dollar. Once all of the un-wanted and un-needed USD’s make their way back to the USA, look for a hyperinflationary collapse and WW3 assuming it hasn’t started by then. Last one out of the USA, turn out the lights.

    • Hell Hater

      I hate the pit of hell I can’t stand it.

  • josh

    I love how the outrage the author tries to drum up, and I love the passion put into such bogus claims, but what I love most of all is the way the author almost makes a person FEEL BAD for the very oil companies that have been profiting by the yacht load for years now.

    • Mike

      Do you like it when companies/employers employ people? Would you “feel bad” if someone you love (maybe you) lost their job and couldn’t provide for their family? Cool bike dude.

      • josh

        thanks. no why would I “feel bad” when other employers cut jobs? people chose the industry they want to get into and pay the consequences or reap the rewards as a result. people chose the employer they want to work for and if that employer can’t provide their end of the deal they probably weren’t going to be a great career opportunity anyway.

    • smallergovnow

      josh, how old are you? graduate from high school yet? still in mom’s basement?

      • josh

        enough, yes, no. how old are you? did you graduate high school yet? still in mom’s basement? do you ask everybody random questions?

  • DesertPaine

    What about ‘peak oil’?

  • VigilanteCaregiver

    Nothing will improve on this oil fiasco until oil and energy policies are fixed. There’s the crux of this problem.

    • Mike Smithy

      Our current dilemma has little to do energy policies. This is an indictment of the Fed’s reckless QE/monetary policies which has created numerous bubbles. The least of which is the junk bond bubble and related derivatives used to fund/capitalize the fracking industry that will likely bring down the house of cards when the obligations are not met.

      • VigilanteCaregiver

        Good points. How about energy policy as a starting line to turn this around… oh yeah, can’t happen with our “leaders” looking for adoration.

        Well, better get that private generator and methane digester up and working then.

  • loyd blankfein jr

    earl drop below $40 a barrel it’ll take wallstreet right with it
    hot money will bail and a derivative time bomb will blow,
    at $35 a barrel everybody bleedin out including the banks ,and unless u can find suckers to keep o loanin u more cash or a fresh war goes
    hot the ride is over

    • Mr olf

      Thoes oil company CEOs now can’t fly their private airones and play olf.

  • Genada

    How does the dollar raise during this? If I understand it, the dollar is backed by oil due to it being used as payment for oil. If you need far less dollars for payment of oil, dollar demand should go down.

    • Mike Smithy

      I suspect that demand for the dollar will go down which will undoubtedly mean a weaker dollar.

      • Genada

        Wouldn’t that mean that oil should go back up then? That’s the part of this I really have the hardest time of understanding, what is the exact relationship between the two.

        In all the stories about what’s been happening, there is lots of talk about there being too much supply. Is there lower demand as well? What is the proper price for oil? Has oil been held at a price higher then it should of been and if so, why crash it now?

        There’s just a lot of questions about this story that do not seem to make much sense.

        • Mike Smithy

          IMO, global demand is down and production is up. Global QE has caused massive distortions and mis- allocations of capital. As a result, these manipulations have caused a lack of true price discovery. I suspect that collusion has taken place between the USSA and Saudi Arabia. They both want to destroy the fracking industry in North America and punish Russia over Ukraine as well as the prospect of Russian oil and natural gas supplying the European market. OPEC members such as Qatar want to run a pipeline through Syria to supply the European market. Lastly, the BRICS are challenging the petro dollar’s global dominance. This is political theatre and the stakes couldn’t be higher as President Zero and the western central banksters are playing a dangerous game of chicken.

        • Billzo

          To partially answer your question, oil and the US$ are related because all member countries of OPEC buy and sell oil using the US$. Henry Kissinger helped make this deal with OPEC in the 70’s. Russia and other countries that try to sell their own oil in other currencies put pressure on the US$ and can lead to war. Saddam Hussein tried this and you know what happend to him. The US needs oil to be bought and sold in US$ to keep their ponzi scheme going.

      • VigilanteCaregiver

        If oil goes up, that will hurt; if it stays down, that will hurt. Stronger dollar is harmful; weaker dollar is harmful. Pain no matter what?

        We’ve got a #$%&ed up system.

    • DesertPaine

      Its a good question, Genada. The answer is that you are exactly right — in the ‘real world’. But current conditions are surreal as you know. The fact is that for as bad a shape that USD is, almost all other currencies in the world are even worse. So USD isn’t ‘rising’ as much as it is falling slower relative to other debt-infused sovereign measures.

    • DesertPaine

      My answer did not seem helpful to you. I’ll be a little more specific.

      All currencies float. They ‘love’ only in relative respect to each other. Why now, you ask? Because currencies of economies dependent on oil obviously plummet. RUB, CAN. Commodities currencies move with them in sympathy. NZD, AUD Equity currencies like USD, GBP, CHF end up better performing, relatively. Meanwhile, crushing debt-to-GDP currencies — Greece, Italy, Eastern Europe — that are close to default cannot compete against anything. USD, the reserve currency, “wins’ by default.

  • MadAsHellYankee

    It’s a real tragedy that the low oil prices are the result of a currency war, and not of a good economy where everyone is making good money and the price of goods is going down to boot. The people who run our system are powerful but my god, they are nuts.

  • Jeffy

    The economy did great from the 80s to 2000 while oil prices were going down.

  • Keith

    Alright I’ve been reading news on this site for a few years now. Each year for the last 3 years it was supposedly the very last Christmas Americans will ever get to enjoy because the upcoming year is going to be “the economic collapse”. I’ve seen this site say high prices of oil is going to ruin everything and now low prices. Best thing to do is get a education with some economics classes and read main stream news and about 5 or 6 alternative news and then you can put the pieces together yourself.

    • Jimmy-Las-Vegas

      I have also been reading this blog for about three years. Yes the author makes some outlandish claims, but that’s what makes me come back for more… same as you I guess.

    • disqus_cczHVJhqgY

      Can you prove that this article is lying?

    • Tina

      exactly. deritiatives used to be the problem but not banks are guaranteed bailout.. and yes Michael needs go ‘outlandish’ to have people come back so he makes his big ad $. nothing wrong with that.
      but lot of stuff here is same stuff written over and over re-worded. I do like Michaels articles but really dont agree with them..i dont even think he truly believes the articles 100%.
      “what if” can used in anything in the world.
      lot of “what ifs” on this blog.
      tax writeoffs for silver coming! lol for me

    • Tiff

      seems like less and less comments here. folks probably starting to believe main stream info,,,cant blame them

      • Gay Veteran

        mean stream info? you mean the corporate media?

  • dongszkie

    Everything demonstrated only that the human system that dominates and run this world is not capable of sustaining it for long. We are still in a trial-and- error processes and the future looks quite bleak for humanity.

  • natxlaw

    on a fairy significant scale

  • chilller

    With oil being one of the lynch pins in our corrupt finance system, I welcome anything that upsets their apple cart. We simply cannot change their evil ways without inflicting pain on ourselves. That’s how we got into this mess in the first place…we’re too comfortable…too complacent…too unwilling to make the sacrifice to stop the TBTF’s.

  • Guest

    This article is sensationalist nonsense used to attract viewers, and thus ad revenue. “Economic collapse” is synonymous with “the 2nd coming of Jesus.” It’s always right around the corner but it never comes, does it?

    This site, and others like it, can only cry wolf so many times before credibility is lost.

    Things are more complicated that we all probably realize. Every bump in the road is not impending collapse. Humanity as a whole is resilient. Just enjoy your life in a balanced way. It’s short enough as it is.

    Living in a perpetual state of fear is not healthy. I’ve wasted too much time here already. Good luck to everyone. Love yourselves and your neighbors.

    • jox

      Do you remember that in the tale, the wolf eventually came?

      You are right in that humanity is resilient. Look WWII: millions of deaths, economies and countries devastated, nuclear weapons, concentration camps, … All this was real, happened, but in the end humanity survived.

      so, it’s true that humanity is resilient, but is also true that bad things happen. Probably when some people looked ahead in 1935 warning for a world war, lot of people mocked them.

      I think that the current financial and monetary system, created in 1971, has reached a dead stop. It can last 3 months or 3 years, but it will fail. Soon I think. Perhaps even in 2015.

      Good luck to you also. Remember it’s better to be one year soon that one day late.

      • Bruce

        There is one MAJOR problems with comparing how the countries recovered back then compared to how we’d recover today.
        Many people back then hunted for their meat.
        They had callouses on their hands from hard work.
        Out houses, slim resources, no electricity was a way of life. I could go on and on but the differences between those people and modern day people is abundantly obvious. The selfish, self absorded, spoiled lazy people of today will parish in a downward spiraling depression full of ignorance and denial.

    • Matt thomas

      You are missing the point, Santa clause and all religion (except the one you believe of course) aren’t real either but they teach good principles. The point is be prepared and independent of government, natural disaster is the only thing that we have to fear when you don’t need money, “if you are prepared ye shall not fear”

      • Mike

        There’s only one truth. And if you’re content to just say that they aren’t real but teach good principles without doing the research, then you will never know the truth. The One who created you has revealed Himself.

        • Matt thomas

          Ha ha cute, of course he has in fact he came over for tea, funny he didnt mention you so maybe its you who needs to keep looking, just kidding, your god is the only true god i dont care which god you pray to, my point is that this blog is about relying on yourself to be prepared and independant because your only true path way liggt , but with all his love for you he wont take care of you, prepping will. So weather its collapse,disaster,war,or religious people like you shooting up the non beleivers, the point is if you can close ypur door for 2 years you can outlast most emergencies. Dont worry your god is the coolest of all the thousands of gods. But even though you and your religion are the only ones going to heaven, everyone needs to prep.

    • Mike

      “Love yourselves and your neighbors” sounds a lot like what Jesus said, “Love your neighbor as your self”. You mock the second coming of Jesus and plagiarize Him in the same breathe. Good luck.

    • alan

      The main part of the collapse started in 2008 and is on going. This is not and overnight event but over a longer time line, like 20 years. The results will be the same just don’t notice it as much.

      I sometimes think of it as a realignment of our living standards to match the rest of the world. However one bad event and it could be over in a night.

  • alan

    I think certain parts of the economy will pickup. Other parts not so good. Always worried someone will get cruise missiled before this is over. I would be great for summer travel time. I bet it will be back at a 100 by then.

  • JustanOguy

    Yeah… because the mortgage market with it’s liar loans and overpriced homes had nothing to do with the 2008 crisis…

  • silbershark

    buy silber phyzz

  • john

    why do you complain? , now you can buy again these monster hummer cars and drive around your town to impress your ladies.


    Lower gas prices are always good, a direct tax cut for any American who drives a car. That said the real problem is the derivatives. As we saw in 2008, it was the mortgage based derivatives unwinding that caused the damage. In this case, it is the oil based derivatives that will cause the carnage. We will probably see the “Mother of all QEs” and the dollar will be knocked off its perch as the Reserve Currency in much the same manner as Nixon took us off the Gold Standard. At that point, visiting Walmart will be considered a luxury outing unless….China decides to downgrade its currency. China may do so but it will do so at a price, the shredding of whatever sovereignty we have left. The Great American Experiment will be over.

    • Gay Veteran

      “Lower gas prices are always good….”

      you should go over to Zero Hedge and read some articles that show it is not good


        I said good for the consumer. I don’t see anyone weeping at the pump. I readily concede It is not good for oil companies and those invested in higher gas prices.

        • Gay Veteran

          fewer WELL paying jobs, energy junk bonds exploding, less capital investment.
          what’s not to like?
          and the consumer? if smart they’re using the money they save to pay down debt

          • XSANDIEGOCA

            We agree…

  • Jackie Milton

    The best thing that can happen to this country is low oil prices. This country needs a total financial collapse. That’s the only possible way to return it to a sustainable path. We need a collapse worse than the depression of the 30’s. Everyone should be forced to become self sufficient rather than depend on the government to extort from some and give to others. I want to see it so bad that we’re forced to pick berries and hunt rabbits for food.

    • K2

      A total financial collapse will be hard to recover from. Because the financial sector is the sector generating most global wealth. Global manufacturing is already down and there is only so much the agriculture sector can do for the global economy.

      • Truegrit

        Financial sector “wealth” is a mountain of paper with ink on it totaling 5 times all the tangible wealth on the globe. Collapse it and the 1% gets a serious hair cut
        the rest of the people will survive with about the same resources they have now

      • Jackie Milton

        I don’t care about the agriculture sector. I want everyones belly aching from being hungry. Especially the ones getting food stamps that i’m now forcing to pay for by taxation.

  • Rocky

    I do not know what to believe any more. I enjoy this website but so many years of “the sky is falling! The sky is falling!” is getting a bit old.

    • Amy

      ia gree. Blog is meant to help but I think it has hurt me.
      bad investments,prepping losses, etc.
      no fault but my own. but pretty clear that if collapse was coming it would have been here. michael smart but authorities even if corrupt are smarter. i appreciate michael and blame myself for listening too much. go back and look at articles from 3 years ago….none of it has caused collapse!
      US economy so damn big it will withstand anything especially with corrupt leaders. i cant see all these main stream people being wrong. yeah they lie, but if things were that bad we would here more concern

      • Gay Veteran

        of course the median income is going down in this country

    • Scottsman

      I think alot of people feel the same way. But when things do turn, they turn very quickly, seemingly out of the blue. All I know is that our debt has gone from $10T to $18T in just 6 years and amazingly, Obuma and most in DC seem to think this is no big deal. Also, this massive debt accumulation has occurred with artificially low rates that have been going on for decades. What happens when rates normalize ? Then I throw in the 50% number of households receiving Gov assistance, and just a overall continual expansion of Gov welfare. Oh yea, lets not forget super low labor force participation which inflates the employment rate. And then, just for good measure throw in open boarders, massive immigration and more welfare expansion and I go WTF ? Oh yea, crisis and scandal on top or crisis and scandal.

      Again, I know what you mean, we all wake up, the sun rises and go about our lives mostly as we always have in the same way but unless the US is somehow forever exempt from the laws of Universe or just common sense, at some point it, seems like something has to give.

  • J White

    Could be a move by large oil companies (Exxon, Royal Dutch Shell etc.) to force smaller shale drilling companies into a merger or outright buyout. In the end, many current drilling companies will be under the control of a handful of larger oil companies. As we all know, we are nowhere close to becoming independent of fossil fuels, no matter how hard we wish to be so. IMHO

  • Truegrit

    So.. the supply vs demand= price quotient of economics is irrelevant
    and we need inflated prices of resources to support crony capitalism and the financial monster created by western banks? Lets quadruple the price of water, electricity, natural gas, and food products. Just think of how many good paying jobs that will create! Lets have $300 per barrel oil or $400 that will create even more jobs!

    • VigilanteCaregiver

      That’s an interesting point: higher prices seem to hurt us, and lower prices seem to hurt us.

  • fc

    When the price of gas went sky high, all we heard (correctly) was how much income was being sucked out of the economy by the extra expense and how “devastating” it was. Now that the opposite is occurring, somehow this is being spun as bad news?
    If higher prices at the pump = bad, shouldn’t lower prices = good?
    Lower prices are good for the consumer allowing them to save and invest their money as they see fit instead of being forced to spend it on higher oil/gas prices which act as a tax.
    To say that you want to see higher oil prices is to say that you do not want to see the free market work which is to say I no longer trust the information I read here.

  • Babylonandon

    OPEC is at war with the US PEOPLE … in order for Obama to continue pushing the JIHAD, the US PEOPLE must be crushed economically, culturally, divided and fighting, and brought under a dictatorship driven by chaos.

  • 2Gary2

    It is very easy to fix the economy. Pay workers more and have
    corporations make less. Plain and simple. The reason this doesn’t happen
    is greedy business owners weren’t satisfied with being millionaires and
    wanted to be billionaires so they put their company on the stock market
    giving away control of the company to the board of directors and share
    holders. Most of these companies could easily increase wages but wont
    because they are beholden to the share holders. So to make the share
    holders more money, they squeeze the American worker by freezing wages
    and streamlining efficiency (aka. cutting jobs and making one worker do
    the job of three). These share holders that call the shots are the 1% so
    all money and wealth from these companies flows upwards at the cost of
    the worker. This systematic behavior has slowly disintegrated the middle
    class. This fallacy of trickle down economics needs to end. This is why
    we have such extreme income inequality and this is why despite the
    unemployment rate, wages are low. You want to fix the economy? Pay
    workers more and corporations make less. In that way corporations will
    actually make more in the long run since workers will have more money to
    spend at other businesses. This isn’t rocket science.

  • 2Gary2

    Obama is president and gas here in WI is 1.89 a gallon. This must drive conservatives crazier (they are already crazy)

  • randyfreedom

    if the price would have doubled we would hear the same things. It seems that no matter what news hits it will result in something bad happening in the future. Has anyone tracked all of the predictions since 2008??? its impossible. Just take out “insurance” in the form of food, water, supplies, gold, silver, etc for WHATEVER happens and live your life.

  • steve

    Meanwhile, the DJIA is up, as are other stock indices. The economy is slowly improving. It probably won’t collapse any time soon. Oil companies seem to make a profit no matter what happens.

  • Jim

    It’s to crash Russia – That what this about. Saudi and the US are trying to hurt Russia with depressed oil prices.

  • gfmucci

    Since I am a piece of dust being carried by the wind, I will enjoy oil prices fall knowing there is nothing I can do about prices anyway. And if derivatives tanked our economy, I’m not sure how that would affect me, personally, either. Be prepared – its a tough and often unpredictable world out there.

    • Bruce

      Presently these prices do make consumers smile. How can anyone not enjoy half priced fill ups, myself included. However, it does have catastrophic consequences for the oil industry that we will all pay for at some point in the future.

  • pedro

    Unknown big oil play similar to Walmart coming to your hometown and pricing the small business on main street into bankruptcy. Venezuela is in very deep trouble and their Orinoco oil play is very sought after by Exxon, Chevron or the Chinese? Enjoy the show.

  • Warden

    CNN online as an article today that says “The American Dream is coming back”. More people are getting jobs, consumer debt is down, and are optimistic, ready to spend more money? How crazy to see such polar opposites views. Sometimes hard to believe anyone?

    • Gay Veteran

      read up on the employment participation rate, it is awful

    • RedPillPlease

      Fortunately, I gave up on “news” from the boob tube years ago as even Faux had well drifted into the disinformation agenda by then. Today, my TV has become strictly an entertainment venue, though I might add, what passes for “entertainment” these days has put it on a countdown for becoming totally obsolete. I’m reminded of Jeff Kinley’s, “As in the Days of Noah.”

  • RedPillPlease

    The ultimate collapse of “our” dollar was a done-deal in 1913 with the creation of the Federal Reserve by the Rothschild agents (ie: Paul Warburg & Co.) It reminds me of the quote by 18th century French philosopher Voltaire … “Paper money ALWAYS returns to its intrinsic value – zero!”

    We can amuse ourselves with finger pointing and sensational predictions all we wish, but the same money masters puppeteering that paper in your wallet also control 75% of the entire world’s assets. They have been pulling the strings for well over a century while we’ve given them the red carpet treatment all the way.

    Famed Georgetown University professor Carroll Quigley detailed the actions of this group leaving no stone unturned in his 1966, 1400 page tome, Tragedy & Hope. While a difficult read for the average Joe to be sure, geared primarily towards the academic, Joseph Plummer has dissected the work in a reader friendly volume, Tragedy & Hope 101, an excellent read. Should you decide to take the plunge, you’ll learn the when, where and how the cancer has amassed itself, along with the measures needed in which to destroy it. You’ll then recognize frivolous alarmism for what it is.

  • Mondobeyondo

    This is extremely troubling, to say the least.
    History, repeating itself….AGAIN!

    Hey, at least gas is under $2.00 a gallon where I live, and it continues to drop. Doesn’t matter much to me, since I don’t have a car. Are we ever going to see $100 a barrel oil again? Maybe. It’s a matter of supply and demand. The supply is out there, the demand isn’t – for the moment.

    • Bill

      $2.61.9 at my 20. Changes come faster than I can cope. Criticle mass is approaching.

    • RedPillPlease

      Supply and demand? Have you considered the refined methods of economic warfare tactics? … currently engaged against Putin and his beloved Soviet Union? In today’s world, the phrase, “Truth is stranger than fiction” should always be considered before the utterances of Katie Couric and her disinformation handlers.

  • Bill

    It is time to ask: are Brent and WTI reaching parady? More importantly, what is the significance of this event. It is 4:37 est.

  • Gay Veteran

    sanctions are also hurting the European economies, but our vassals will do as DC orders

  • Bill

    Back to extremism– check Glen Beck’s” comments made today on this subject.

  • Gay Veteran

    it is not just jobs going away and energy junk bonds exploding.

    from Zero Hedge:

    “For all those who have forgotten that the I in the GDP equation stands for Investment, here is a reminder courtesy of the latest crude collapse victim, Suncor, which moments ago announced it is not only cutting its 2015 CapEx by $1 billion (as in I, directly and adversely impacting US GDP by the same amount) but that it would also cut “operating expenses” by up to $800 million, and, drumroll, implementing “a series of workforce initiatives that will reduce total workforce numbers in 2015 by approximately 1000 people, primarily through its contract workforce, in addition to reducing employee positions. There will also be an overall hiring freeze for roles that are not critical to operations and safety.”…”

  • Leave it to Beaver

    what about rubber commercials?

    • Paul F

      filthy commercials target both men and women–as a man, I don’t need to be sitting next to my wife and see a bra commercial. It’s up to the man of the family to allow what comes into the home–the television can bring in filth and disease if allowed. Just like an intruder, the man must guard his family against the television. I wouldn’t let a half naked woman walk into my home when I’m sitting on the couch with my wife–and I won’t allow it to be shown either. television has to be closely monitored. cable is filth–get rid of it. In my house we have Roku and closely monitor what is watched.

  • EconomyTrap

    The oil price has been falling since July 2014 because QE stopped in July of 2014. Its that simple. QE stops = value of dollar increases = oil price falls (oil is traded worldwide in the US dollar).
    Take the above combined with surpluses in oil since 2008 and you have a perfect storm for oil prices to drop fast.
    The only reason oil stayed above $100 since 2008 while there was surpluses is because QE devalued the dollar and masked the effect that surpluses have on oil.

  • iguana one

    Look. The big Oil Companies are just gettin’ rid of the small fish
    “Riff-Raff” competition. That’s all. Then look out! War in the middle east and sky rocketing oil prices and economic chaos in the USA.

  • T.

    A new Glass-Steagall will NEVER be passed into law. Government is SO controlled by Banksters – It will NEVER happen.

  • Bruce

    I agree that the current price of oil is actually hurting the economy and certainly the oil investors. However, I think this recent downward trend will be short lived. A major resurgence in vacation travel this spring and summer will evaporate the current over supply and prices will surge once again. We will see 100/ barrel by early 4th quarter.

  • johnnymule

    Good! It seems to me that in order to rebuild anything on old ground then the old must be torn down and discarded. The central bank fiat fractional reserve system is a farce, it’s chocked full of criminals, thieves and every sort of low life filth that has ever been mistakenly deemed a part of the human race. Destructive parasite psychopaths that have never and will never give a damn about anything but themselves. I say bravo and I hope that the majority of the riff raff that has caused so much turmoil are brought to trial, judged by humanity based on their deeds and disposed of accordingly.

  • citizen49a

    Assume it’s true that this is a move by the Saudis and friends to run the shale oil industry into the ground, and that the second order effects are as dire as described.

    Why is the U.S. government sitting on its hands and not intervening in some way in this market?

    If this is going to destroy our economy, then this amounts to an act of war.

    Is this not a good time to start using sanctions?

    I mean if the whole shooting match is going up in flames here, what good does it do to preserve whatever remains of the agreement behind the petrodollar?

    Since the U.S. economy pulls much of the world economy, an appropriate use of sanctions against Saudi Arabia here would seem to be in the interest of the world.

    And yet we hear nothing about this. Obama’s only mention of this actually implied he supported this, because it was going to make life tough in Russia.

    There are a lot of things here that do not make any sense, but if the derivative markets blow up again and the U.S. economy falls off a cliff that’s it.

    The Fed has interest rates at 0%. There’s nothing left for them to do to try to stimulate the economy. We are cooked.

    And Obama is sitting there letting it happen with a big smile on his face.

  • Vincent Tenaglia

    Would uvreally be happy paying extra money for gas/oil just to prolong the inevitable economic collapse…the fiat system was set up for failure..

  • Bobloblaw67

    First of all this HAS happened before and the results were positive for the US economy. Dec 1985-June 1986, the price of oil fell 50%. The following 24 months saw GDP growth a 4%, a decline in the unemployment rate by more than one full percentage point. Regional economies will be hurt and regional banking wil be hurt, but overall the USA isnt a petrostate. The country will be better off with cheap oil

  • Jack Listerio

    Nobodys got any money. Zerocare mandates and penalties got rid of the normal 40 hour work week and created 2 part time jobs out of one. Net effect a plastic lowering of the unemployment numbers and a loss of incomes never seen before. Then the Obamcare tax roll outs:

    Happy New Year? Here is what will happen on January 1, 2015 :
    Top Medicare tax went from 1.45% to 2.35%
    Top Income tax bracket went from 35% to 39.6%
    Top Income payroll tax went from 37.4% to 52.2%
    Capital Gains tax went from 15% to 28%
    Dividends tax went from 15% to 39.6%
    Estate tax went from 0% to 55%
    Remember this fact:
    These taxes were all passed only with democrat votes, no republicans
    voted for these taxes.
    These taxes were all passed under the Affordable Care Act, aka Obamacare

  • Matthew Schilling

    We need a tariff on imported oil equal to the delta of $100 and the current price of a barrel of oil. If the current price is $46, then the delta is $54, and the tariff would be $27.
    That puts the domestic price of a barrel of oil at $73. Just a few short weeks ago, that price was considered a wonderful boon to the economy. In fact, it is kind of a Goldilocks price: High enough to support our domestic oil and gas industry, while a relief to consumers after years of $100 oil.
    Such a tariff would make our domestic oil and gas industry immune to international efforts to strangle it. OPEC could give the stuff away for free and the domestic price would be $50 – higher than it is today.
    Remember, even after several years of great news out of our oil patch, we still import millions of barrels every day. If we were to push for energy independence, we would create hundreds of thousands of great jobs here in America.
    AND, we would be paying more than a third of that $73 TO OURSELVES. In an era of sequestration, and with the backlog of infrastructure work needing to be done, that is good news.

  • William Ripskull

    If America had a healthy manufacturing sector, this would actually be good for the economy, but since much like Russia, energy is one of the few bright spots in the economy, its not going to be so good for our economy. I’m not real sure how its going to shake out, but I have a feeling on the bad side.

  • AntonioOssa


  • Kaspar_Goering

    During the last Presidential election, many Conservatives were predicting 300 dollar a barrel oil. And now they are saying how bad low oil prices are going to be. Which one is it? Yous guys all were saying how “great” it will be when America can produce it’s own oil needs. And now we are told this is terrible.

    Please decide which one is worse.

  • Charles Lloyd

    What a bunch of BS – Oil will be phased out eventually and those
    who are displaced from their businesses and jobs have enjoyed the oil economy far too long as it is. Jump ship, take the billions you made, and find a better way to serve the world than drilling into the earth and selling oil. That’s called a change for the better. If you are still parasitically working in the oil industry, try taking some classes on solar installation or something else that actually helps the world in a better way. But wait, this page is about Doom and Gloom at ALL COSTS!

  • Happy Tinfoil Cat

    Bring it on! Low oil prices are good for the economy.

  • Lonegunman79

    So you are saying that when oil is held off shore in tankers to artificially inflate the prices and cause a shortage, gouging the consumer at the tank and crippling the economy for the poor but puts money in the pockets of the wealthy it is a good thing? Additionally in reverse when the prices comes back down and the rich start loosing money and the poor start to prosper its a bad thing? I think you are buying too much into what has been bad for our economy known as trickle down theory and Reganomics.

  • Jim Hilton

    Who in the oil/gas industry cried any tears for the tens of millions of working class Americans who lost their houses or ended up needing food assistance when they were screwing us all with $4 bucks a gallon at the pump? And now that fuel prices have dropped have the food outlets reduced their prices after raising them supposedly due to fuel cost? Hell no; they’re still ripping us off. You’re actually asking the people to hope for a return to that slavery again? You can go kiss my a–. Gas at $2 bucks a gallon and falling fast? I’M LOVING IT !!!!!!!!!

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