The Mogambo Guru says today’s $44 price tag for a barrel of oil is just the tip of the big, cold, floaty thing:
Peter Schiff of Euro Pacific Capital has looked at the future of oil prices, and has some very bad news in that regard. “Chinese oil demand today is only a small fraction of what it is likely to become after the Yuan is floated. Once that occurs, the value of the Yuan will rise to reflect the true productive output of the Chinese. As oil prices collapse in Yuan terms, hundreds of millions of Chinese will then be able to afford oil that was previously too expensive. The result will be a surge in oil demand emanating from China. However, additional world productions will not be able to accommodate this new demand. Instead, Chinese demand will be satisfied though reduced American demand, because while the price of oil will collapse in Yuan terms, it will increase substantially in dollar terms.”
It could be a long, cold winter, folks.