RE:RE:RE:RE:Non-Opec Supply Muddles Bull Case for OilAbsolutley. There is no doubt that higher interest rates will cause a lot of dislocation
and an initial inflationary impact as businesses try and pass their costs on. But as the
layoffs start to bite hard, it will be increasingly difficult for businesses to pass those
costs on. Recession are always hardest for people at the bottom, such as low wage
earners and the unemployed but there is also pain higher up the food chain as debt
loaded businesses, especially consumer related begin to realize that traffic is slowing
sales are stagnating while their overhead costs are fixed. Once the bankruptcies
start to really climb, you know its getting bad.
As an example, in Vancouver where I live, taxes are going up at least 10% and the surrounding municpalities are more or less equal to that. Taxation levels combined
with higher interest rates are becoming a toxic brew leading into the law of diminshing
returns. This is a direction that is slowly going to crush the H ell out of people and the
economy. Just keep this up with more interest raises like Powell has sgnallled and
its only a matter of time before the sh*t hits the fan.