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Mustard Seeds

December 12, 2008 RSS Feed Print

A glimmer of hope from JPMorgan Chase:

"Retail sales declined 1.8% in October and ex-auto retail sales fell 1.6%. ... The core category – which strips out these sectors – actually posted a surprisingly strong 0.5% increase, the first increase in that category since July. ... Given that over 500,000 jobs were lost in the month of November, the most plausible explanation for the increase in core retail sales is that gasoline prices dropped a record 30% in the month, freeing up purchasing power for those lucky enough to keep their jobs."

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I agree, supply and demand can not account for the quick run-up in prices, as well as the steep, fast decline.
President Bush triggered the decline when he lifted the executive ban on offshore drilling a few months ago. It was then that speculators began to change direction. That being said, now is the time to increase our off shore drilling to avoid another ridiculous run-up in oil prices.

Marc of NY 9:13PM December 12, 2008

Yes, and the drop in gas prices is a tremendous stimulous to the low-income folks who can bearly afford to commute at $4.00 a gallon.
Now, will someone PLEASE write about why and how oil and gasoline prices were tremendously inflated by speculators. A $100 drop per barrel is not the result of the actual reduction in demand we have yet seen. Couldn't be. No way.

of 1:19PM December 12, 2008

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