On what basis can the bankruptcies be blamed solely/mostly on consumer behavior, versus the viability of many fracking companies being staked on an impermanently high oil prices? The oil industry is notorious for boom-and-bust cycles.
Who's culpable for the bankruptcy of businesses that were only viable under a Zero Interest Rate regime? Should we blame consumer exuberance - or excessive consumption - for pushing up interest rates and causing bankruptcies?
The Fed dropped the ball by keeping rates low. Their choice to keep them artificially low created mountains of problems that we’re still suffering from.
Notably at least partially due to political pressure from Trump - including threats to fire the chairman of the Fed - to avoid higher interest rates and even defaults on his and his families extensive real estate holdings.
In the Antithesis of a trump supporter but don’t make it seem like Obama couldn’t have done anything when he benefited from the low rate environment too.
Consumers are not responsible for macro-economic changes that make a subset of businesses unviable. I was likening Shale Oil companies that could only be profitable at >$95 a barrel to companies that were only viable when capital was cheap - both groups should have known and planned for the respective numbers changing.
This entire thread is interrogating whether consumer behavior (excessive consumption ) is to blame for business failures as suggested, but never explained by the original statement.
It’s trying to describe excessive consumption, which is always going to be subjective - except perhaps if we use the description ‘drives up prices beyond historic norms’. Which is why they put it in quotes.
And excessive production is also always going to be subjective - except perhaps
if we use the description ‘causes a glut of product which drives the price of a product below the reasonable/historic cost to produce that product’.
So excessive production is that which bankrupts producers. And excessive consumption is that which drives up prices unsustainably. Yeah?
Who's culpable for the bankruptcy of businesses that were only viable under a Zero Interest Rate regime? Should we blame consumer exuberance - or excessive consumption - for pushing up interest rates and causing bankruptcies?