Why can't an economy be more like a car?
Convective thought.

What's missing in the oil-price mess? What's missing in the stock market?

A driver.

Both have become self-driving cars, dependent on pre-written codes (literally in stocks, fig in oil) that mechanically read momentary trends. They buy or sell, ramp up or down production, in IMMEDIATE response to IMMEDIATE data.

You can't run a system that way for long. It will crash. It will kill other pedestrians and drivers.

These systems originally had a living PURPOSE. They were meant to serve the interests of real people generating real value. Oil is meant to keep factories and cars running. Stocks were originally meant to build businesses and provide jobs, not to move pure numbers between giant servers at nanosecond speeds.

FDR saw this happening in agriculture in the '30s. Individual farmers were unable to see larger needs, so they responded mechanically to instant price changes. The result was not serving the basic purpose of agriculture. Agriculture exists so non-farmers can eat. (Or conversely, ag exists so that some eaters don't have to be farmers.) This implies reasonably low prices to the consumer, sufficient storage, and reasonably high prices to the farmer; in turn this requires efficient farmers who can produce enough food without exhausting their land or lives or money.

When most producers are desperate and indebted, supply and demand doesn't work. Low demand means low prices. Desperate producers have to keep turning out higher quantities to survive. Secure producers can slow or stop production when prices are too low, allowing prices to rise again.

FDR (or more precisely his advisors) designed a system with 'shock absorbers' to smooth out the immediate bumps and valleys of supply-demand pricing. Farmers learned how to be more efficient, and subsidies made them more secure.

Something similar is needed for oil and other resources. The present setup responded blindly and stupidly to China's giant infrastructure bubble, assuming infinite linear expansion. Nature don't do linear. Everything reaches saturation in a tanh pattern, or runs up and down in cycles. When you begin with an expectation of sine patterns, you'll be far more cautious about ramping up production. Slower increases of production mean higher prices, which will slow down a bubble-generator like China. On the other end, a proper shock-absorbing system should pay efficient producers to keep running when demand is low, to keep their skilled and experienced workers on the job pending the next (damped) upramp.
  ¶ 5:16 AM