Quote:
Originally Posted by Azure
I suppose I could do that. That is what my question is too.
I just want to know what the deficit will look like next year with the continuing rise in the price of oil.
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Most global economies are likely to see a resurgence in tax revenues in the coming years as business conditions normalize.
It's not just an issue of government spending that has created deficits but also the fact many governments saw tax revenues collapse by one-third or more in the 2008-09 period.
In a place like Alberta, there is extra leverage because we get a cut of a surging commodity. In other economies, oil is simply an rising input cost and nothing else.
America, which is one of the top three oil producers in the world, the effect of the latest jump in oil is probably beneficial overall . . . . . unless it gets crazy as happened in the summer of 2008.
For Alberta, the downside is going to be persistent lower natural gas prices which weighs on drilling activity in particular. Lots of different opinions on natural gas . . . .
A lot of the movement in oil and other commodities is a result of the global economy improving and money flowing away from the safe haven of the USA dollar and back into more risky areas of the world. When you continue to see supertankers full of oil anchored off coasts with nowhere to ship, you do wonder how much oil is really worth and if a collapse might be coming.
Cowperson