Friday, March 06, 2009

Price of crude oil and stimulus packages

According to this article, the more than 70% slide in crude oil prices from its record US$147 a barrel in July is providing for consumers and business a savings approximately three times larger than the entire announced 2009 fiscal stimulus of China and the western economies combined. 

The governments should quite throwing money into corporate sinkholes. Most of that money will be lost. Next the governments will print more money, deflating the value of the various units of currency. Hard-earned dollars in savings accounts will slide in worth. We're not out of the fiscal woods yet. Governments adopting ideas that were rightly rejected 20 years ago are being put forward as great and new ideas. This old and bad ideas will only keep us in the woods longer.