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Oil prices caused the economic crisis

Started by Josquius, March 11, 2012, 04:12:58 AM

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Josquius

March 11, 2012, 04:12:58 AM
I was reading a piece on Japan and what went wrong. It was saying there was more to it than the late 80s bubble bursting, though exactly what I don't know, he trailed off. I had lost interest before hand too, with one comment he made....that the lehman brothers collapse couldn't possibly have damaged the entire world economy, that it was oil prices reaching record highs which obviously really did it.
This is new to me so I googled and....it seems to be quite a common theory- albeit amongst nobody reputable.
Just what is the thinking behind this idea? Who are its pushers and what do they stand to gain?
I assume its the free market nuts who want to keep leaving the banks to do their thing?
Anyone know anything about this?
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Richard Hakluyt

#1
March 11, 2012, 04:36:15 AM
Commodity prices are generally very high and have been for some years. In former times a recession would lead to those prices falling which would help the future recovery. This time round, as countries like China continued to grow and industrialise, there has been no real fall in commodity prices - which is holding back the developed world's recovery.

Think back to the mini-recession of 2001/2 (not 100% sure of the precise dates), the oil price collapsed to below $20 a barrel, which greatly helped the recovery.

Iormlund

#2
March 11, 2012, 06:42:13 AM
Oil prices are a big factor in the lack of recovery, not in the crisis origin.

PDH

#3
March 11, 2012, 09:35:08 AM
According to Santorum, it was the high prices of summer gas that led to the mortgage defaults.
I have come to believe that the whole world is an enigma, a harmless enigma that is made terrible by our own mad attempt to interpret it as though it had an underlying truth.
-Umberto Eco

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"I'm pretty sure my level of depression has nothing to do with how much of a fucking asshole you are."

-CdM

Razgovory

#4
March 11, 2012, 10:35:45 AM
Even I know better then that.
I've given it serious thought. I must scorn the ways of my family, and seek a Japanese woman to yield me my progeny. He shall live in the lands of the east, and be well tutored in his sacred trust to weave the best traditions of Japan and the Sacred South together, until such time as he (or, indeed his house, which will periodically require infusion of both Southern and Japanese bloodlines of note) can deliver to the South it's independence, either in this world or in space.  -Lettow April of 2011

Raz is right. -MadImmortalMan March of 2017

Neil

#5
March 11, 2012, 11:28:08 AM
Quote from: Razgovory on March 11, 2012, 10:35:45 AM
Even I know better then that.
Than to listen to Santorum?  I should hope so.
I do not hate you, nor do I love you, but you are made out of atoms which I can use for something else.

Ideologue

#6
March 11, 2012, 12:52:14 PM
Agree with Iorm.  Lack of oil and food will lead to dieback, but it's pretty laughable to think they caused people to overvalue houses and derivatives thereof and loan money that wouldn't be repaid.
Kinemalogue
Current reviews: The 'Burbs (9/10); Gremlins 2: The New Batch (9/10); John Wick: Chapter 2 (9/10); A Cure For Wellness (4/10)

KRonn

#7
March 11, 2012, 01:54:47 PM
How much of a factor is it with oil traded in US dollars, and the dollar losing value, that the price of oil has gone up because of that? For some years now, since the Bush admin and maybe before, the US dollar has been losing some of its value.
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