Oil Falls Below $50 As Global Financial Markets Begin To UnravelMichael Snyder These are precisely the kinds of things that we would expect to see happen if a global financial crash was coming in 2015. Just prior to the financial crisis of 2008, the price of oil collapsed, prices for industrial commodities got crushed and the U.S. dollar soared relative to other currencies. All of those things are happening again. And yet somehow many analysts are still convinced that things will be different this time. And I agree that things will indeed be different this time. When this crisis fully erupts, it will make 2008 look like a Sunday picnic. Another thing that usually happens when financial markets begin to unravel is that they get really choppy. There are big ups and big downs, and that is exactly what we have witnessed since October. So dont expect the markets just to go in one direction. In fact, it would not be a surprise if the Dow went up by 300 or 400 points tomorrow. During the initial stages of a financial crash, there are always certain days when the markets absolutely soar. For example, did you know that the three largest single day stock market advances in history were right in the middle of the financial crash of 2008? Here are the dates and the amount the Dow rose each of those days October 13th, 2008: +936 points Just looking at those three days, you would assume that the fall of 2008 was the greatest time ever for stocks. But instead, it was the worst financial crash that we have seen since the days of the Great Depression. So dont get fooled by the volatility. Choppy markets are almost always a sign of big trouble ahead. Calm waters usually mean that the markets are going up. In order to avoid a major financial crisis in the near future, we desperately need the price of oil to rebound in a substantial way. Unfortunately, it does not look like that is going to happen any time soon. There is just way too much oil being produced right now. The following is an excerpt from a recentCNBC article Since June, the price of oil has plummeted close to 55 percent. If the price of oil stays where it is right now, we are going to see large numbers of small producers go out of business, the U.S. economy will lose millions of jobs, billions of dollars of junk bonds will go bad and trillions of dollars of derivatives will be in jeopardy. And the lower the price of oil goes, the worse our problems are going to get. That is why it is so alarming that some analysts are now predicting that the price of oil couldhit $40 later this month Were headed for a four-handle, said Tariq Zahir, managing member at Tyche Capital Advisors in Laurel Hollow in New York. Maybe not today, but Im sure when you get the inventory numbers that come out this week, we definitely will. Open interest for $40-$50 strike puts in U.S. crude have risen several fold since the start of December, while $20-$30 puts for June 2015 have traded, said Stephen Schork, editor of Pennsylvania-based The Schork Report. The only way that the price of oil has a chance to move back up significantly is if global production slows down. But instead, production just continues to increase in the short-term thanks to projects that were already in the works. As a result, analysts from Morgan Stanley say that the oil glutis only going to intensify Yes, lower oil prices mean that we get to pay less for gasoline when we fill up our vehicles. But as I have written about previously, anyone that believes that lower oil prices are good for the U.S. economy or for the global economy as a whole is crazy. And these sentiments were echoed recentlyby Jeff Gundlach If the price of oil does not recover, we are going to see massive financial problems all over the planet and the geopolitical stress that this will create will be unbelievable. To expand on this point, I want to share an excerpt from a recentZero Hedge article. As you can see, a rapid rise or fall in the price of oil almost always correlates with a major global crisis of some sort And without a doubt, we are overdue for another stock market crisis. Between December 31st, 1996 and March 24th, 2000 the SP 500 rose 106 percent. Then the dotcom bubble burst and it fell by 49 percent. Between October 9th, 2002 and October 9th, 2007 the SP 500 rose 101 percent. But then that bubble burst and it fell by 57 percent. Between March 9th, 2009 and December 31st, 2014 the SP 500 rose an astounding 204 percent. When this bubble bursts, how far will it fall this time? Related selfnews Post Article: This article first appeared here at the Economic Collapse Blog. Michael Snyder is a writer, speaker and activist who writes and edits his own blogs The American Dream and Economic Collapse Blog. Follow him on Twitter here. 