Is there some sort of a movement underway to destroy the United States economy?

Question

I don't know how many of you have noticed, but the price for a barrel of crude has now creeped above $78, less than $2 away from that until - now - only - talked - about $80 mark. With that said, do you realize that if some sort of major geo - political event took place and suddenly drove the price up to $125 a barrel, the U. S. economy would be destroyed overnight? Now, I know the that the price we pay at the pump is largely market driven. But, don't these greedy b******* who control these markets realize that if they destroy the economy, there won't be a market left for them to manipulate? And furthermore, do you think they even care? Afterall, most of them have already made their millions on the backs of the everyday consumer. But, I guess, they just want more and more, huh?

For " NC ": If the price for a gallon of gas would rise to even the $5 level, I'd probably have to declare bankruptcy. And I suspect that there are millions of others out there in the same boat as me. So, what do you say to that?

Answer 1

The Occam razor suggests that there is no such movement. Simulation modeling of a commodity market where investments are large and irreversible and the finished product is not perishable suggests that the market should behave the way it does even in the complete absence of collusion. If you are good at math, this could be an interesting read:

Fridrik M. Baldursson
Modelling the price of industrial commodities
Economic Modelling
Volume 16, Issue 3, 3 August 1999, Pages 331-353

Abstract
The theory of irreversible investment under uncertainty and the theory of competitive storage are combined in a rational expectations model of the price formation of industrial commodities. In continuous time, an endogenous price zone arises from the opening and closure of capacity at boundaries of the price zone. Dynamics of the price process within the price zone are determined by competitive speculation. The model is scaled to the dimensions of the aluminium market and solved numerically. Simulated prices and inventories exhibit characteristics similar to the real series: volatile prices, asymmetric adjustment of production to price changes and long inventory cycles.

[End of quote]

Also, before you moan about the supposedly tough life in the U.S., take a hard look at Europe, where gasoline prices on any given day are more than twice as high as they are in the U.S. Japanese gas prices are not far behind, either, so if the movement you are alluding to does exist, its primary targets must be Europe and Japan, not the U.S.

Answer 2

No one can accurately predict what would happen if the oil price spiked overnight, given the number of variables involved.

You got a BMW, you want a Bentley; you got a Bentley, you want a Lear Jet, etc. You will never know what is enough money. The fact is that money poisons you. Money is the most powerful driving force in our lives, aside from the need for food and shelter. If you are very rich, your judgement is forever twisted, and you can't think beyond the constraints of the power that the money has granted you. You acquire the arrogance of royalty that we only read about in history books. Historically, there have generally been two types of royals: the altruistic and the aristocratic. They seem different, but they play for the same team. One uses direct condescension when dealing with others, the other uses indirect condescension and pities the peasant.

Do they care? They are like drug addicts; money is the drug and it rules supreme. They literally don't know that they are doing anything wrong. All sorts of elaborate rationalizations are applied to their actions. If someone questions the morality of their actions, they assume that the questions arise out of jealousy. And most of the time they do. None among us are strong enough to not do similar things if put into the same situation.

Answer 3

Well, I think a lot people were jealous of US growth after WWII, and part of the break of the Communist bloc was to try to achieve that growth. Unfortunately, the more successful ways to achieve that growth was through taking advantage of the US high wages. So many countries were able to take manufacturing jobs from the US by accepting really low wages. It was thought that once these jobs and technology was understood, wages could rise. And to some extent they have.

Ironically, because so many of these countries are tied to the success of exports to the US, none of these countries wants the US to fail, since they will suffer as well. At least until they can find alternative buyers.

Answer 4

So we are on the tipping point of an inevitable economic implosion?

Only the crazees were contemplating this thought before.. but when the proverbial "shoe shine boy" can easily ascertain the world economy can no longer sustain its waste and greed running rampant...

Anyway good to see that you know to use bankruptcy as a business tool to gain a more solid footing in this economic situation.

Does this help any?

Answer 5

I doubt that anyone is trying to destroy our economy. There are plenty of people who want to emulate us, or ride on our coat-tails, or even squeeze us for as much as they can.
Once foreign oil gets to a certain price, we will start developing our own shale oil and tar sands.
It all balances out.

Answer 6

What does a guy who has just made his first billion dollars want more than anything in the world???









His SECOND billion dollars.

Answer 7

Oh yeah. There's one in every country pretty much, including ours.