As stock markets around the world have plummeted lately, you'd be forgiven for barely noticing a related and hugely important economic development: The price of oil has fallen even more than US stocks, and gasoline prices are following.

That is both good news and bad news for consumers and the economy. Prices are falling partly because of worries about a global economic slowdown. And yet Citigroup estimates that the fall in oil prices adds up to a $1.1 trillion stimulus for the global economy.

Crude-oil prices have dropped more than 8 percent in the past week, while the Dow and SP 500 have each fallen about 6 percent. In the past three months, oil has fallen a little more than 22 percent and is now approaching $80 a barrel for the first time since 2010.

Crude-oil prices have plunged.

The fall, the Wall Street Journal reported, is partially due to a US-driven boom in oil production. That boom, combined with deepening worries that a slowing global economy will mean lower demand, means lower oil prices.

So the bad news is that falling oil prices seem to be very much part of the same economic fears that are pushing stocks lower.

On the other hand, lower oil prices may help rescue the very economic growth people are worried about. It will at least be a bonus for consumers. As Yahoo Finance's Aaron Task succinctly put it, falling oil prices are "good news for pretty much everyone other than energy producers and their shareholders."

The average price for a gallon of gas in the US is now $3.16 and falling, according to AAA. Thats down from $3.38 a month ago. And nearly a third of US gas stations are selling gas for less than $3 a gallon, according to AAA.

This is, in effect, consumer-spending stimulus: Lower gas prices mean more disposable income for American households. The New York Times, citing energy expert Tom Kloza, estimated that the average household will see "annual savings of $120 for every 10-cent drop in the price of gasoline." Those savings take some time to work their way into Americans' pockets, but are significant nonetheless.

Dean Baker of the Center for Economic and Policy Research thinks that even as the US economy struggles, dropping oil prices are a good thing, even if they push too-low inflation into far-scarier deflation:

If we have a mortgage debt will it be harder to repay our mortgage now that we have to pay less to drive our car or heat our house? If companies are thinking of investing in expanding a factory or new line of software will lower energy prices and possibly lower long-term interest rates make this less likely?... If we exclude the situation of commodity producers, this is a positive for the economy.

So if you can muster the sympathy, pity the oil man, along with Vladimir Putin, whose "best friend," Bloomberg writes, is high oil prices.

For the rest of us, the bad news is that oil is falling just like the stock market. The good news is that falling oil prices can help keep things from getting worse.



European carmakers are rallying after data showed car sales in Europe climbed 6.1% to 1.3m vehicles last month.

Shares in Renault and Volkswagen are both up 3%, and Peugeot Citreon have surged 5.5%.

Europe's car market bottomed out last year, ending a six-year slump, and has been growing for 13 months.

According to the Association of European Carmakers, Germany, the biggest market, saw sales rise 5.2% to 260,062. The UK, the number 2 market, was up 5.6% while France, the number 3, climbed 6.3%.

Sales in Spain, Portugal and Greece surged 30% or more as buyers snapped up cars from Volkswagen, Ford and Opel.



WASHINGTON (Reuters) - The number of Americans filing new claims for jobless benefits fell to a 14-year low last week and industrial output rose sharply in September, positive signals that helped ease fears over the economic outlook.

Initial claims for state unemployment benefits dropped 23,000 to 264,000, the lowest level since 2000, the Labor Department said on Thursday.

A separate report from the Federal Reserve showed production at the nations factories, mines and utilities advanced a larger-than-expected 1.0 percent last month, the biggest gain since November 2012.

The data offered evidence the economy remained on solid ground, with the labor market gaining steam. Investors in recent days have come to the view that slowing growth overseas will weigh on the US economy and force the Fed to delay a hike in interest rates, with weak retail sales data on Wednesday helping to fuel a global sell-off in stock markets.

The jobless claims report, however, reinforced expectations that slack in the labor market was being reduced and, combined with comments from a top Fed official, put a brake on the selling on Wall Street.

Have we achieved full employment? Not yet. Are we getting closer? Absolutely, said Stephen Stanley, an economist at Amherst Pierpont Securities.

The Standard Poors 500 index .SPX closed up marginally, while the blue chip Dow Jones industrials .DJI slipped a bit further. Yields on US government bonds US10YT=RR moved higher.

Some of last weeks drop in claims may have been related to the Columbus Day holiday, economists at RBS told clients.

The government, however, said there were no unusual factors in the report, and a four-week moving average of claims, which irons out weekly volatility, also fell to its lowest since 2000.

OASIS OF PROSPERITY?

A Reuters poll published on Thursday showed economists still clinging to the view that the Fed would raise benchmark borrowing costs from near zero in the second quarter of next year despite mounting signs of weakness overseas.

The poll, however, was largely completed before the latest stock market sell-off, which has been accompanied by a big shift in investor expectations for the path of US monetary policy. Interest rate futures now point to a rate hike in October 2015.

St. Louis Federal Reserve Bank President James Bullard said in a television interview with Bloomberg that the US central bank might want to keep its bond-buying stimulus program running for longer than anticipated to combat the risk of a drop in already low inflation, comments that eased investors nerves.

But with the US economy motoring ahead, many analysts said they expected Bullards advice to fall by the wayside.

Economists still expect third-quarter growth to come in at around a 3 percent annual rate, a view buttressed by the pickup in industrial output.

The Fed pinned part of the gain on unusual weather that boosted air-conditioning use but there was also a broad-based increase in factory output, which grew a solid 0.5 percent.

A third report from the Feds Philadelphia branch showed slowing growth in factory activity in the mid-Atlantic region.

(Reporting by Jason Lange and Tim Ahmann; Editing by Paul Simao and James Dalgleish)



You may have heard of the collaborative or sharing economy- the concept is quite simple. Consumers are able to get what they need from each other instead of always going to large organizations. This includes good such as baby toys and wedding dresses to services such as web design work or ride sharing.

It's true, that the terms "sharing" or "collaborative economy" are being quite overused to encompass pretty much any and every single thing you think of, and that causes a lot of confusion. For example many of the things that fall under the sharing economy are what we used to simply call "renting," now it seems as though any business that is aiming to target a consumer of any kind somehow gets labeled as being a part of the "sharing economy." However overtime this will be ironed out and clarified as the market matures.

Jeremiah Owyang, who is my guest on this episode of The Future of Work Podcast put together a very helpful visual which helps paint a picture of what we are seeing.

I think Wikipedia has a pretty good explanation of what the sharing economy is:

The sharing economy (sometimes also referred to as the peer-to-peer economy, mesh, collaborative economy, collaborative consumption) is a socio-economic system built around the sharing of human and physical resources. It includes the shared creation, production, distribution, trade and consumption of goods and services by different people and organisations. These systems take a variety of forms, often leveraging information technology to empower individuals, corporations, non-profits and government with information that enables distribution, sharing and reuse of excess capacity in goods and services. A common premise is that when information about goods is shared, the value of those goods may increase, for the business, for individuals, and for the community.

Consider the following numbers from Forbes:

"The revenue flowing through the share economy directly into people's wallets will surpass $3.5 billion this year, with growth exceeding 25%. At that rate, peer-to-peer sharing is moving from an income boost in a stagnant wage market into a disruptive economic force." - Forbes Jan. 2013

To help shed some light on what the sharing or collaborative economy is all about and how it's impacting both businesses and consumers, we turn to my guest for this week, Jeremiah Owyang.

Jeremiah is the founder of Crowd Companies.

What you will learn in this episode

  • Definition of the collaborative economy.
  • Importance of the collaborative economy and why it is such a big thing now.
  • What's going to happen when robots come into play in a collaborative economy
  • Is a collaborative economy a short term fad that's eventually going to be replaced? Or is this going to be a long term sustainable thing that's going to be impacting the world?
  • Examples of the collaborative economy.
  • How different generations are taking advantage of the collaborative economy.
  • What are the driving forces for the collaborative economy?
  • The first companies or leading organizations that started the collaborative economy movement.
  • Is renting the same as the collaborative economy? What's the distinction between the two?
  • What's the impact of the collaborative economy on the government - impacts on safety, security, liability, regulation, and taxation.
  • What are the negative effects or problems that may arise as a result of the collaborative economy?
  • What is the future of the collaborative economy?

Jacob Morgan is a work futurist, best-selling author, and keynote speaker, learn more by visitingThe Future Organization.com