The price of a barrel of oil recently dipped below $90, which on the surface seems like good news for consumers and depositors in savings accounts. However, the context of the slide in oil prices is yet another example of the yin and yang nature of today's U.S. economy.
Just as yin and yang represent the good and the dark sides of life, the decline in oil prices over the past couple weeks has a kind of positive and negative duality. Cheaper oil prices are welcomed by most Americans, but what they say about the strength of the economy is troubling.
The dip in oil prices
Oil has had an up-and-down year so far in 2013. On a few occasions, the price of a barrel of oil has peaked at just over $97, only to slip back. Oil was up to that level again as recently as the first couple days of April, but by April 22 the price had fallen to $88.76, a low point for the year and a drop of about 9 percent.
Nobody who drives a car has to be told why lower oil prices are good news. Even away from the gasoline pump, lower oil prices benefit consumers in general because oil tends to set the tone for inflation in general. In particular, lower inflation -- or even a roll-back in prices -- would be a relief to people with savings accounts and other deposits, who have seen their purchasing power steadily eroded in recent years as bank rates have failed to keep up with inflation.