The last month has been defined economically by two events – the Wall Street panic and the price of oil going off the cliff. The former dominated headlines, as one would expect, while those of us who had an eye on the latter were largely ripped for watching an effect and not a cause.
Well, it turns out the symptom cured the disease today (CNN, emphasis added):
Wall Street rallied Thursday, finding momentum toward the end of a volatile session, as the lowest oil prices in more than a year gave investors a reason to scoop up shares battered in the recent market selloff.
For the record, oil finished under $70 for the first time since last August (CNN).
Now, this is only one day, but for that one day, Wall Street finally started to notice the everybody’s energy cost has taken a dramatic nose dive, and acted accordingly.
Could the American electorate be far behind in this realization? We still have two and a half weeks to go. and the race may be getting closer already (Below the Beltway).
October 16, 2008 at 5:08 pm |
I would be wary of looking for any political significance in what happens on Wall Street on a day-to-day basis. Since Monday we’ve been up 900 points, down about 200, down another 700, and now up 400. This is all a reflection of more uncertainty than Wall Street has seen in a long time.
As for oil and gas prices, if they stay down between now and Election Day, my bet would be that would hurt Republicans and their “drill baby drill” idea.
October 17, 2008 at 9:55 am |
Gasoline futures closed at $1.6220/gal – the lowest price since February 15, 2007–add the average tax on gasoline of 48.4 cents, and you get $2.106 (before transportation and retail margin)–so we should see major downward pressure on gasoline prices if futures prices continue to be this low.
Gasoline futures fell by over 80 cents over the two weeks from 9/26 to 10/10…retail has fallen by over 3.5 cents each day for nine consecutive days. Current average $3.040. VA average $2.943. Fredericksburg average $2.85.
FYI–wholesale to retail pricing trends tend to lag about a week to 10 days…I think we will easily see $2.50 by Hallowe’en and may be fast approaching $2 by Thanksgiving…
October 17, 2008 at 10:17 am |
Watch the Democrats claim credit for falling gas prices.