. . . starting today, with the stock market: It will have one of its best days of the year.
How it will do when it reopens after observing MLK’s birthday is less clear. Certainly, it could have further to fall after running up past Dow 18,000 last year from a March 2009 low of 6,500.
It’s not unusual after a long run of complacency to encounter a sharp pullback. So I’d argue that this may not be anything more than that.
After all, one key reason for the current bloodbath — and if you own energy-related stocks, it’s been nothing short of a bloodbath — is the price of oil. But there was a time when the broader market might have looked on low energy prices as a good thing.
Not good for the Saudis or Kuwaitis or Russians or Venezuelans or Iranians or Iraqis, certainly. Or for the oil companies who’ve restored America’s place as the world’s largest producer. But for anyone who drives a car? Or who makes or buys or sells anything that’s shipped? I.e., any “goods” at all? For them — which is to say for all of us — each penny drop in the price of gas puts roughly $1 billion back into our pockets that we can spend on other stuff . . . the purveyors of which may thus make more profits (and employ more people who, newly employed, may themselves buy more stuff).
The oil collapse, in short, is not like the housing collapse.
And may be reason for the brave contrarians to start buying oil stocks and their brethren.
This time could be different, but ordinarily, this is how cycles work. When oil is over $100/barrel, no one imagines it can ever again be under fifty. When oil is $29, people begin to think it may never again hit seventy-five. And maybe it won’t. Between conservation and efficiency on the one hand and ever-cheaper clean alternatives on the other, we may someday need oil for little more than to make Saran wrap (and about a zillion other things it’s used to make). On the other hand, as noted here, American consumers are now reveling in cheap gas all over again and are likely to supply some of the demand that might one day once again boost the price of oil.
Aaaaaaanyway . . . despair does little good, even in falling markets, and my point is: I would like to dedicate this week to making you feel better. So one day this week I will add health and length to your life. And another day this week I will make you feel good about an important new macro-economic development we’re about to nail down.
But today, I give you simply these 13 minutes in which are summarized the way our “stupid, stupid leaders” made a deal that ends all Iranian paths to producing nuclear weapons . . . without the loss of a single life . . . the bombing of a single carpet . . . or the expenditure of a single taxpayer dollar.
(Also: the return of Americans held prisoner. And even: the possibility, over time, of an ever more cooperative Iran relationship.)
I know the Republicans think all this is awful.
And that our economy — with a booming auto market, healthy housing market, and more net new private sector jobs created in the most recently reported on the last 12 weeks than in the last Republican 12 years — is just awful.
Everything is just awful because Mexico’s leaders and China’s leaders are so much smarter than ours and we tax billionaires and billionheirs too heavily.
But actually, there’s lots to feel good about — and there would be lots more if the Republican Congress hadn’t blocked hiking the minimum wage and blocked putting people to work revitalizing our infrastructure.
The economic record of the last 7 years is really good.
And take those afore-touted 13 minutes to see how we avoided what might have been 13 years of war with Iran.
It wasn’t the approach Bush and Cheney took in Iraq; and no one is smarter than Dick Cheney, Don Rumsfeld, Ted Cruz or Donald Trump. But still.
Quote of the Day
Money is a singular thing. It ranks with love as man’s greatest source of joy. And with death as his greatest source of anxiety. Over all history it has oppressed nearly all people in one of two ways: either it has been abundant and very unreliable, or reliable and very scarce.~John Kenneth Galbraith, The Age of Uncertainty
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