There is plenty of gloom and doom talk about right now.  Stock markets are crashing around the world, jobs are being lost everywhere, company profits are tumbling and consumers are feeling very insecure and have radically reduced their spending.

The fact is though that things are not nearly as bad as they seem and the long term outlook is still good.

What are the positives out there right now?

Interest rates are falling rapidly and this will put more money in the consumer’s pockets to spend or to save and pay down debt.

Oil prices have fallen dramatically.  A few months ago there was talk of oil prices hitting $200 US per barrel.  They are now closer to $50 per barrel and this has resulted in petrol prices coming down from close to $2.00 per litre to $1.00 per litre with the potential for it to go even lower.

This will all have the effect of taking pressure off inflation and make it even easier for the Reserve Bank to cut and maintain lower interest rates.

The recent spending packages announced by the government will also have the effect of stimulating the economy.  The danger though is to avoid unnecessary spending which.

This entry was posted on Friday, November 28th, 2008 at 3:15 pm and is filed under Uncategorized. You can follow any responses to this entry through the RSS 2.0 feed. Responses are currently closed, but you can trackback from your own site.