June 7, 2008
Markets Falter After Hitching to Slippery Oil Rope-a-Dope
Yesterday, the Dow Jones Industrial Average took a 400-point-drop bath, prompted by rising oil prices and higher unemployment numbers, and stirred up more recession fears.
Just Thursday, growing inventories of oil and decreased demand led investors and the public to think that perhaps our long national love-hate affair with oil had reached an amicable reconciliation. But then the oil prices rose to $138/barrel--an $11 jump--thanks to the weak dollar, Asia's "unprecedented" demand for Middle East oil and news that world supplies were not as robust as previously thought.
Some market analysts think oil could reach $150/barrel in the near future. Though many car owners are shifting their driving habits to deal with the added gas costs, some buyers of gas-guzzling Humvees could not be dissuaded from what they feel is the purchase of a sweet 14-mpg ride. Poupette Bangoura, a rare customer at the Manhattan Hummer dealership, told the NY Sun, "I like Hummers — everybody says that I'm crazy, but I don't care. It's my dream car. I've been saving every penny for the H3."
Still, Thursday night on Late Night with Conan O'Brien, Wanda Sykes expressed that perhaps if Humvee owners insisted on playing soldier, perhaps it would be fair play for people to shoot at them.
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Just wait till winter. I wouldn't be surprised if a drive through the suburbs found only one light on in the corner of the McMansion that homeowners can afford to heat, and sinking pavement under the Yukon or Hummer that is no longer used. No one tricked these individuals into consuming at the limit of their credit. But I get a feeling the taxes I pay will bail them out. There is something wrong with a system that punishes planning and saving.
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Wee, these are going to be some fun times. Don't forget the 2.47% foreclosure rate for prime mortgages!
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#1 At the same time, without these government safety nets, imagine what would happen if everything were privatized--as Robert Reich has said before, thank goodness there is government intervention.
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Don't gloat so much, Eoin. It's going to hit everybody. Prices for everything from food to clothing will go up and up as it costs more to move them on tractor trailers, railroads, planes, and even UPS trucks. There's a finite and dwindling amount of oil and the more the selfish consume, the higher the prices for everyone who has to compete for it.
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Government intervention created this bunch of crises. For instance: Fed creates funny money to keep stock market up. Then there is too much money, needs somewhere to go. Create subprime mortgages, hook people who cannot pay but not smart enough to figure this out. Hookees think they're rich, borrow money against equity, spend, get further in debt. Inflation starts. Fed starts to raise interest rates to curb inflation. Hookees can't pay, hookers go bankrupt, system starts to crumble. Now give hookees more money? Further inflation, more crumbling? Don't give hookees money? System crumbles anyway. Damage has been done.
Better stock up on rice and beans.
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I am not gloating, it is going to suck for everyone. And I understand that government intervention is necessary in some cases. However, the selfish will reap the greatest windfall from government intervention in this instance, which is disconcerting.
For example: Did you buy too much house or lie on you mortgage application? That is not a real problem, the government will reform your mortgage so that you can keep the house you could not afford, and pass the balance on to those who understand how to manage their personal finances.
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It's a beautiful day in this neighborhood,
A beautiful day for a neighbor.
Would you be mine?
Could you be mine?...
It's a neighborly day in this beauty wood,
A neighborly day for a beauty.
Would you be mine?
Could you be mine?...
I've always wanted to have a neighbor just like you.
I've always wanted to live in a neighborhood with you.
So, let's make the most of this beautiful day.
Since we're together we might as well say:
Would you be mine?
Could you be mine?
Won't you be my neighbor?
Won't you please,
Won't you please?
Please won't you be my neighbor?
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The rapidity of the paradigm shift in America is astonishing.
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it's going to suck more for the rich,
the poor are used to eating rice and beans.
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The rich are already liquefying some assets. Mostly because of the fact Obama will become president and increase capital gains taxes and change other personal and institutional financial laws.
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Those fucking traders and speculators drove up the price of oil over nothing and then took off for their Hamptons weekend. It's like they stabbed us all in the back. Well guess what, assholes, when we finally wrest this nation away from you corporate cunts, we will try you summarily, force you to dig mass graves and line you up at the edge and machine gun the greed out of your rat hides.
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These Wall Street Scumbags make up .0001% of the population, yet create 90% of the problems in the Markets. May they burn in hell