A Silver Lining?
by Efin Advisor | December 22, 2008
Despite the dark clouds that have cast a shadowy pall across America’s countryside, there are fleeting signs in the sky that something may be twinkling on high and the economy is not quite as dismal as we all may dread, or, at least, that the storm front shows imminent signs of clearing.
As the year rolls to an end, the dollar has actually increased in value compared to foreign currencies like the Euro and the Yen. This is rather remarkable considering how much money the Fed is printing and the bundle of billions sliding down the chimneys of our temporarily credit-frozen banks. One of the biggest concerns of the bailout thus far has been inflation (the lessened ability to purchase goods at the same price) but if the dollar continues to increase in value, American’s will be able to buy more with every dollar which will help the economy even more.
Any more silver in the lining? The number of people filing for first time unemployment benefits fell this past week. This could mean that less people are being laid off than expected and that businesses are finding ways to cut costs without cutting personnel. Early fears that the unemployment rate would skyrocket may be hyperbolic as a result.
Finally, oil prices are down to under $37 a barrel, the lowest they have been since early 2004. At the very least, it’s more likely that people will be able to travel where they need to be able to get to work, and heat their homes this coming winter. If oil prices continue to drop, companies will be able to realize lower operating costs in their offices and factories, which can only help us.
Yes, Virginia, we are technically in a recession which began a year ago, but there are positive aspects that people can point to. In the American tradition, we can hope to pull ourselves up and out very soon, and make fundamental contributions to our nation’s infrastructure in the process. Do you think the economy is improving? What can we do to weather the storm?
I do agree, the biggest silver lining that came out of this whole crisis is the dramatically lowered gasoline prices lately. Gas prices always fall during winter, and with the price of oil sinking like a rock, it’s great to finally have some relief from the absurd gas prices we’ve seen over the past few years. I still believe we need to put a windfall profits tax into place for oil companies to make sure those numbers stay low, but if there is one way to stimulate the economy, it’s making it easier for people to travel, and this welcome economic effect is doing just that. I’ll be sure to use this fortunate turn to drive to my nearest mall and stimulate the economy!
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Because oil is getting cheaper (which is great news in and of itself) the economy is going to improve so much. Not only will people and products get cheaper, but because people around the world are buying more oil (which is priced in US dollars) that means that we will see the value of the dollar improve as well. We will end up seeing deflation which will vastly improve everyone’s lives.
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I really do think the economy is improving. These are clearly hard times. Yes. But things are getting better. There is a bright star in the future for america and it’s coming fast. Bank of america predicted that we would be out of this by the end of 2009 which is fantastic. As long as people keep trying to work with the economy and having faith, we will pull through, its the american way.
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We can fix our problems by remaining strong and having faith in the eocnomy. I think there was a post a while back about how faith in the economy is one of hte most important factors in economic success. I think that holds true now just as much as a few months ago when it was posted. We need to keep investing, keep buying products, and while saving is good, we need to make sure we have money earning interest and invested in companies. If we all divest, that wont help anyone, itll just hurt everyone. Go out and spend your money
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