US Recession Caused by Falling Oil Prices (!?)

[cieldumort]

HUH?
US Recession by Falling Oil

Well, it's not allll that simple, and James Hamilton over at Econobrowser posits that falling oil prices alone may only be culpable in triggering regional recessions (think oil production heavy economies, like Texas, or North Dakota).

Prof. Hamilton starts out by quoting < Donald Luskin's Jan 7th article in the

Comments

[ext_3498699]

While I am not a financial analyst and don't know a lot about macro and micro data, I am a consumer and take a great interest in things that affect my pocketbook. In theory, falling oil prices would seem to be a boon to the economy. As consumers have more discretionary income they will spread it around and boost local businesses, but you also have to ask why the oil prices are falling in the first place and how does that apply to me.
Another aspect of this issue is the fact that people are wary after the recession we've been through and no one believes it's over. Therefore we hold on to our money until the economy begins to perk up, but will that ever happen if everyone’s afraid to spend? Good food for thought. Thanks for an interesting post.

[cieldumort]

Another aspect of this issue is the fact that people are wary after the recession we've been through and no one believes it's over. Therefore we hold on to our money until the economy begins to perk up, but will that ever happen if everyone’s afraid to spend?

Ergo, Japan

[robbied90]

I'll freely admit that the after last recession and the austerity that followed it made me more aware of what and how I was spending my cash on. Having said that though, what is the point in saving if I make next to nothing in return?