Originally Posted by
xafalcon
At some point the stampeding herd realises there is actually no need or purpose to the stamped and returns to business as usual, or even notices that the pastures they now find themselves in are much greener than the ones they left behind
In the US a few high-cost oil companies will fail, maybe a bank or two that over-exposed themselves to oil extraction/exploration will also fail. The oil market will start to correct to a happier price point as US fraking swing supply reduces. World growth accelerates, demand for many things grows as money not spent on "necessary" oil based products is spent elsewhere, including demand for (now cheaper) "discretionary" oil based product purchases. The oil market continues to correct to a happier supply/price point.
This has already happened to most commodities - minerals, coal, natural gas, dairy, oilseeds, consumer products. High oil prices only lasted this long due to the OPEC cartel, which has now lost it's relevance thanks to to new disruptive technologies.
Did the banks fail when other commodity prices reduced significantly? No, not on a scale that made the news. Countries and businesses adapted or closed, and life and the economies went on
I have zero sympathy for OPEC member states that now find the going tough. Although I acknowledge that as they withdraw funds from their many offshore investments vainly trying to maintain their extravagant lifestyles, that there may be a short term reduction in various asset values around the world. But I truly believe that this effect will be short, and then swamped by the following worldwide increase in discretionary spending. The wealth is being redistributed globally, rather than being concentrated in the lucky few countries with large oil reserves
The worldwide explosion in air travel and tourism is one example. Shipping rates on every import & export across the globe falling significantly is another