‘History Does Not Repeat Itself, But It Often Rhymes’: Gas Prices Are Falling So Fast Because The Economy Is On The Verge Of Collapse
November 5th, 2012
Conditions are so bad, they are just plain bad. (Sandy and California gas crisis are just the catalyst this time) I believe anything which can trigger the collapse of consumer spending and slowdown in economic activity will crash the stock market because the institutions will suddenly begin betting on a fall in the oil price and then stock market.
THE NEXT RECESSION WILL BE TRIGGERED BY OIL
At this point, watch the price of oil if you want to know when the next recession is going to begin. As I’ve pointed out many times in the past, recessions (well, at least since World War II) have all been preceded by a sharp spike in the price of energy. Any move of 100% or more in a year or less, has historically been the straw that breaks the camel’s back. Modern economies cannot survive that kind of shock. It invariably triggers the collapse of consumer discretionary spending and economic activity comes to a grinding halt.