Questions

  • Posted by e4 on January 21st, 2008 filed in General

For die-hard peakniks, this is not quite breaking news, but for readers who don’t follow this stuff on a day-to-day basis, I have a couple of concerning tidbits.

Stock markets around the world have been plunging since yesterday, despite (because of?) the US President’s announced plan to stimulate the economy, and despite the Fed’s surprise 0.75% rate drop. But it got me wondering: Is any percentage of this plunge just fallout from President Bush’s recent allusions to a Saudi oil production peak? When he was questioned about discussing a production increase with that country’s king, he said the following:

“If they don’t have a lot of additional oil to put on the market, it is hard to ask somebody to do something they may not be able to do.”

I mean, the stimulus package itself couldn’t have been much of a surprise, and the markets usually eat up the rate drops, at least for a few days. The quote itself is covered with if’s and may’s, but financial people are used to reading between the lines when it comes to this stuff. If Saudi Arabia is maxed out, I don’t think even the most optimistic experts out there think there’s a replacement Saudi Arabia yet to be discovered.

So was Bush’s rare candid response like pouring gasoline on the flames of US recession talk?

Think about it: What economy is most vulnerable to oil supply problems?

Now, in case you haven’t seen this graph from The Economist, take a look - especially at the left half:

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4 Responses to “Questions”

  1. Wendy Says:
    January 23rd, 2008 at 9:58 pm

    I guess I wouldn’t put it past him to want to stir up the hornets nest before he leaves office. Maybe he figures the Democrats are going to win the next election, and so he’s going to do as much as he can to screw things up so that they have a really big freakin’ mess to contend with when they get into office - kind of like what happened in 1977 when Carter took office. He had to clean up the mess left by Nixon and Ford, but there wasn’t enough time, and he ended up being labeled a very bad President. Watch, the same will hold true for the Democrat who wins in November. I wouldn’t want to be that person. He/She is being set-up for failure.

    Personally, I think the stimulus package is bunk, and it won’t do a darned thing to “stimulate” the economy. Everyone I know whose eligible has already said he/she plans to hoard it.

  2. e Says:
    January 23rd, 2008 at 10:15 pm

    Man, you’re not kidding about the next President walking into a huge mess. It looks like a no-win situation. Whoever wins may get blamed and end up being the last Democrat/Republican/Woman/African American to be elected for a long time.

  3. e4 Says:
    January 24th, 2008 at 10:38 am

    Well, another day, another rabbit pulled out of some hat. Who are these people dumping billions into the stock market right now anyway??

  4. Chile Says:
    January 24th, 2008 at 11:05 pm

    So, here’s another thought to ponder. The next Prez walks into a big mess. What will we end up with in the next election after that?!

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