GM and Chysler Bankruptcies

[Jester]

Ah, but energy prices are multiplicative in the supply chain. Part of what has destabilized this latest economy has also been the summer 2008 period when oil peaked over $145/barrel. What hurts an economy is not necessarily raising the price, but the shock of raising it so quickly. This is also what I'm forecasting with GM and the supply of vehicles. Also, it's not just drivers that suffer, it is also travel, and destinations. If people drive less, or fly less, then hotels, resorts, rental car companies, restaurants, and etc. will also suffer from a lack of business. This kind of a change has ripple effects in causing unemployment, and depresses the entire world economy. Then, we can talk about the price of fertilizer, and therefore food. Then, there is the cost of plastics, and other petroleum based products that are not used for fuel.

This is all well and good, but it contradicts the original point. If you are an oil company, you produce an increasingly expensive commodity. You are in good shape, not bad shape. Everyone else might need a government bailout, but you'd be sitting pretty.

-Jester