Great Depression anyone?

I'm learning economics in my A- Level and I can say that the subject is pretty interesting as it involve around the world.

My economics lecturer, Miss Jean always reminds and also emphasis us to be open minded to the economics and also issues around the world right now. She also ask us to start reading articles, newspaper or anything to enhance our economic "power" so to speak! She wants us to write our opinion out so that it can help us in our essay in both As and also A2 economics paper. How cool is that?

I always admire some of those BIG SHOTS blogger like Tun Dr. Mahathir ( our Premier Prime Minister) and Datuk Tony Fernandes ( CEO & Founder of Air Asia) who constantly shared or voice out their opinion on the current market and economics. At the same time also, they shared their experience on how to be a great entreprenuer in todays world. So what the heck? I shall try to be like them too and test my economics "power"...haha...

Why is the price of Good and Services remains the same even though the price of Oil have drop to US$ 78 per barrow?

1. Few months back, the price of oil in the world have cause a stir around the world in terms of the world economy where by the price of oil have shoot up to US% 190 per barrow.

2. Therefore, it have force countries around the world to revalue its price of oil so that it is competible to it. Like in our country, the government had no choice but to raise its price of oil from RM 1.92 up to RM 2.70 including subsidies. The great change was that the government chose to raise it as much as 70 cents.

3. Back in those days, way before the price of oil increase due to the limited of resources, the government should had let our price of oil to float in the market but they chose not to and went ahead with the fixed market instead. If the government had choose to go with the float market, I believe that they won't have to raise it till 70 cents.

4. Even if the government wants to go ahead with the fixed market, they shouldn't had increase it till 70 cent because once they increade the price of oil, good and services will tend to increase too. The effect of the high increase can be seen very clearly right now when the price of oil around the world have drop to US$ 78 per barrow and our price of fuel have drop to RM 2.50.

5. Good and services won't drop of coz even if the price of fuel keep on dropping. like duh!!! Who on earth would want to decrease its price of good and services? Obviously, they wanna keep the price that they are having now because they can earn extra profit from there.

6. Based on the Demand & Supply theory, once the price of the supply is increasing or remains the same above its optimum point, the demand of its good and services will tend to fall but since some goods are necessities to the consumer, the producer will still gain some extra profit and with this profit,they can overcome the loss that they make due to the decrease of the demands. Apart from that, it had also cause the consumer surplus to decrease as less people are willing to pay now.

7. so who feel the pinch right now? WE, THE CONSUMER of coz! If the government should had increase little by little, I believe the price of good and services won't be this high in the current market. With inflation and also economy crisis around the world we are facing now, I believe we will be feeling more pinch soon in the future.

8. So should we feel depress about it? I guess we will be having another great depression soon with US economy going down and down even more!

9. so peeps! start saving and speculating!!!!