
Originally Posted by
Melonie
In regard to falling prices for ( certain ) real estate, for ( certain ) cars, for imported consumer electronics etc., a huge contributing factor is falling 'demand'. Yes lots of Americans would buy real estate, or a car, or consumer electronics IF THEY COULD ACTUALLY AFFORD TO PAY FOR THEM. But thanks to recently enacted income verification requirements, stress analysis requirments etc. on the part of private sector lenders, a notable percentage of 'subprime' borrowers are now shut off from accessing the credit necessary to buy things that they can't afford. There are still exceptions, of course, i.e. de-facto US taxpayer subsidies for 'subprime' GM auto loans via Ally Bank /GMAC, US taxpayer backed student loan money being used to purchase IPads etc.
Agreed that the price levels of US gasoline and US natural gas are not directly coupled to the world price of oil or gas. This is based on the fact that US gasoline refining capacity and natural gas distribution capacity is 'landlocked'. Thus, temporarily at least, US gasoline and natural gas prices are significantly below world market levels. However, with each day that passes, new LNG export terminal capacity, the switching of US gas wells to oil, etc. chip away at the 'landlocked' supply = lower prices factor.
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