Oil Prices Dropping

[spriltsc]

so i am very confused right now. I know that the decrease in demand because of our economy has brought oil prices down way too fast. But... I don't understand how that is bad? Does it weaken the dollar or something or affect the global economy??

[FScott]

so i am very confused right now. I know that the decrease in demand because of our economy has brought oil prices down way too fast. But... I don't understand how that is bad? Does it weaken the dollar or something or affect the global economy??

I had a decent article but I forget where it went. I don't know if this is what you are looking for but:

http://blogs.ft.com/wolfforum/2008/10/john-muellbauer-deflation/
Economist:
"...the faster oil prices now fall and boost household budgets, the shorter will be the period of deflation that follows."

Time:
http://www.time.com/time/business/article/0,8599,1849215,00.html?cnn=yes

"When prices start to fall because of lack of demand, they can go well below the cost it takes to produce products," said Bernard Baumohl, executive director of the Economic Outlook Group. "Companies have no alternative than to cut back production and lay off a lot of workers. That cuts demand more. You get this vicious downward spiral in prices."

It can also be much more difficult to fix a deflated economy than an inflated one.

[anamericangod]

I'm not sure what the original post is asking, but:

1. The less expensive oil is, the better.

2. The less oil we use, the better.

3. Fuck the middle east.

[wrppdarndyrfngr]

OPEC cut production yesterday. $ per barrel of oil probably will go up soon.