When the economy shows even a hint of recovery, will the price of oil shoot up to 150 dollars a barrel again?

Are we doomed to a permanent entrapment between recession on one hand, and hyper commodity inflation on the other?


It's not just oil either. It's food, steel, oil, copper, everything shoots up 300% just because the economy is booming.When the economy shows even a hint of recovery, will the price of oil shoot up to 150 dollars a barrel again?
It is unlikely that oil will shoot up to $150 per barrel. The increase in oil price was a bubble. That bubble has burst, perhaps permanently. In the past, it has been that when bubbles burst, the asset will remain at its new level after the burst of the bubble stabilizes. For example, during the dot-com bubble, Microsoft, Dell, and Intel among others were selling stocks at over $100 per share. Now, their stocks sell for relatively low prices. It is unlikely that we will ever see share prices for these companies like those seen during the dot-com bubble.





Bubbles burst when an asset becomes overvalued and investors lose confidence in the value of an asset. The increase in oil prices to $150 was due largely to speculation. After many traders burnt their fingers the first time around, it is unlikely that they will make the same mistake twice. A bubble is a period of rapid growth. Usually, bubbles do not repeat themselves for the same asset. So therefore, while the price of oil will definitely increase, it will not shoot up to $150 per barrel. In other words, we will not see a bull market for oil, i.e. there will not be a price spike. The gains will be quite gradual. If oil reaches $150 per barrel, it will likely be due to factors more fundamental such as supply vs. demand rather than speculation.





Also, if Obama is the least bit smart, he will understand that the price spikes in oil are proof that aggressive research must be conducted into alternative energy sources. If the right steps are taken, such as emergence of alternative energy, it may be possible that oil will never reach $150 per barrel.When the economy shows even a hint of recovery, will the price of oil shoot up to 150 dollars a barrel again?
No we are not doomed. Just go back to the fact that about 1982-83 this country had rampant inflation and a severe recession. It responded by creating sound money and lowering tax rates. The longest, almost uninterrupted period of growth in history followed. Of course, today we are raising tax rates and rapidly inflating the money supply. So perhaps we are doomed.
Obama FLOODED the world with 3X the existing amount of US currency.





WHEN the markets turn around, all that EXTRA cash is going to propel us into MASS INFLATION.








Love him or hate him.... Obama has created a horrible monster in the US Economy. We need to do everything we can to FREEZE the ';bailout'; money before we commit economic suicide.
No, but it will go up inevitably.


I would definitely say now is a good time to buy and wait until we dig ourselves in another ditch with overspending and over consuming... then we'll all sell and be able to keep our houses this time.
You aren't going to have to worry about the economy showing even a hint of recovery.
I feel you on that..
i dont think so...:)