Recession looms as Oil goes up and the Dow goes down
These are far from certain times for the American economy. The Dow is on the slide, closing below the psychological 12,000 mark on Friday and fears of recession seem to be well founded. Warren Buffet has already been quoted as saying the U.S. is in recession but the federal government seems to be hoping its economic stimulus package will get it out before it becomes official. It seems recession is here in everything but name despite the best efforts of the federal reserve to ease tensions with interest rate cuts.
Not to make matters worse but while the Dow goes down, OPEC has decided not to increase production at their meeting in Vienna, Austria. This as expected has caused oil prices to increase and they are now sitting comfortably above the $100.00 point. This is not welcome news for American drivers, as gas prices increase nationwide. While the American economy does have a large effect on the rest of the world it seems that the current economic crisis is going to be most acute in the U.S. with the Dollar hitting new lows against the Euro.
The U.S., despite probably having to go through some harder times than they have had recently will most likely be able to stay afloat just because of how valued a customer base they are to foreign salesmen. For example they are still an essential market for OPEC and if consumers can’t buy oil and its derivatives, that will have a serious negative impact on the OPEC countries. The stalemate that exists between them looks like it is stable until China or India is able to make up the capacity, which may still be some years off.
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