Markets, Viruses, Russia

A boogeyman does exist. It is Putin of Russia. Why? Because his nation is bankrupt and down on its international influence. The only thing he has is military materiel to cause mischief, and a supply of oil that is declining in value.


But wait. Market experts (oil pros) are certain he is pressing the global oil price lower to make it impossible and impracticable to mine oil from shale rock. The American resurgence in oil production has come mainly from shale oil production, aided by fracking wells. This fresh supply of crude oil has destabilized the world oil price.


Theory goes: destroy the price of oil by artificially lowering it, and the new American oil producers will withdraw from the market, making oil scarcer and causing the price to jump higher. With higher oil prices, Russia’s oil supply returns to as a world factor and earns Russia gobs of international monetary balances.


So, when the coronavirus has most financial markets spooked – supply chain interruption, absences in the labor pool due to illness, etc. – an oil market disruption complicates the mathematical probabilities and creates chaos. Just what Dr. Putin ordered.


Alas! Putin doesn’t understand the collaborative approach of western democracies. We work together for the good of vast numbers of people within and without our borders. Markets are calmed by thinkers with the credentials that matter. International diplomats reach out to one another and lead the way back to calm certainty. Leaders across the globe do the same.


Together we take a large gulp of air, exhale slowly, and realize all is not lost. All is, in fact, much the same, and now we get back to work.


There are fundamentals of life working among us. We need each other. We need each other’s goods, services and minerals to make the products we all need. We buy and sell these to each other. Economic transactions build and the world economy purrs along quite nicely.


The bullies in the classroom only have an effect on the classroom they are in. The rest of us are elsewhere and see him outside our influence. We go on with daily routines and careers. The day shapes up pretty much like all the days preceding it.


All is well in spite of bullies and power mongers. The people have the power. Always have. It is up to us to do our jobs and keep on doing what matters.


Franklin Delano Roosevelt said it best: “The only fear we have to fear, is fear itself.” And then, Winston Churchill went on to say, Keep calm; we will survive!


Good advice still.


March 11, 2020