The oil market has changed substantially over the past ten years.
The most important factor that explains the lower volatility and price impact in the face of geopolitical risks is that the United States no longer depends on OPEC. At the end of 2019, the United States reached a record in oil production, more than 12 million barrels a day, above Russia, 10.8 million barrels a day, and Saydu Arabia, 10.3 million barrels a day. The United States’ dependence on foreign oil purchases is the lowest ever, and if we consider North America (Canada. US and Mexico), the region is almost self-sufficient.
Upside-down economics’ defenders say that deficits create savings. The process never starts with deficit spending, but with the assets and wealth of the economy, which can be leveraged only to a certain extent and never decided by the borrower but the lenders. Borrowing is never the first step neither endless.
Negative rates are the destruction of money, an economic aberration based on the mistakes of many central banks and some of their economists who start from a wrong diagnosis: the idea that economic agents do not take more credit or invest more because they choose to save too much and therefore saving must be penalized to stimulate the economy. Excuse the bluntness, but it is a ludicrous idea.