Why did so many economists wrongly forecast a quick boom from lower gas prices?  In today’s Investor’s Business Daily I explain why:

“Ping” is a terrible sound. In 2008 the U.S. Olympic men’s and women’s 100-meter relay teams fumbled their batons and heard pings as the dropped batons bounced around the track in Beijing. Economies have metaphorical batons, too, when certain sectors must transfer growth to others, say from trains and cement to consumer goods like socks and trousers. But those economic batons can be dropped just as easily as a relay runner’s.

Right now the U.S. economy is trying to pass a slippery baton. For the past few years, oil and gas drilling have propelled growth. States like North Dakota, Oklahoma and Texas have flourished with enviable jobless rates ranging from 2.8-4.4 percent. For the first time since Terry Bradshaw fired passes for the Pittsburgh Steelers in the 1970s, steel plants began rising in Ohio and Pennsylvania to provide pipes to oil and gas drillers. Shares of Tesla catapulted higher as Goldman Sachs and others forecasted that oil would hit $130 a barrel. Salesmen hawked sun panels at every county fair and small-town craft market.

But with oil having collapsing to around $50 a barrel, the baton must be passed. Firms like Halliburton, Schlumberger , and Baker Hughes have already announced nearly 60,000 in job cuts, which did not show up in the Department of Labor’s suspicious and booming jobs reports for January and February. Houston has been home to one-sixth of new office construction in the U.S. Look for a big sale on crane rentals.

Furthermore, the collapse in the Euro and Yen (and don’t forget the Russian Ruble and Ukrainian Hryvnia!) stings U.S. exporters. Suddenly, international firms like Airbus and Komatsu can steal market share from Boeing and Caterpillar by waving lower prices in front of customers.

Who can catch the baton? The first beneficiaries of the oil glut were, of course, airlines, who cheered cheaper jet fuel. No surprise that share prices of Delta and American soared by nearly 50 percent in the past year, despite miserable winter weather, stranded travelers, and airport workers shoveling snow.

But here’s the real question: Will American consumers spend their energy savings quickly enough to offset the pain in the oil and gas patch? Most economists have blithely nodded their heads: “Why, of course, consumers will take their roughly $150 billion in energy savings and go on a spending spree!” So why have Wall Street’s first-quarter GDP forecasts suddenly slumped to well under 2 percent or just plain zero, according to the Federal Reserve Bank of Atlanta’s latest missive?

The gleeful economists forgot the lesson of Milton Friedmanpancakes syrup pennzoil – always a hazardous move. Friedman won the Nobel Prize in 1976 in part because of his Permanent Income Hypothesis. He taught us that consumers are not so flighty – a short-term snap in prices does not quickly flip their long-term buying habits. In other words, consumers must trust that low energy prices are here to stay. Only then will they change their habits and spend the windfall. For this same reason, Friedman scoffed at temporary tax cuts.

Friedman’s research explains, therefore, why Target, Wal-Mart and others did not dance a merry jig on St. Patrick’s Day, and why the bare-chested model standing in front of the Abercrombie & Fitch store on 5th Avenue looks so lonely. U.S. consumers are waiting, and foreign consumers feel broke.

Don’t get me wrong. Lower oil prices will eventually help the overall economy. I thought that back in April 2014, when I forecast on Maria Bartiromo’s television program that oil prices would plunge by 50 percent. But it’s a treacherous pass of momentum for the economy. Eventually, seeing cheaper gas signs spinning at the corner service station will prompt kids to nudge their parents to drive to Disneyland. Farmers will pay less to fertilize and plow their fields. Sherwin Williams will earn more profits on house paint. Sure, lower oil prices are a very good thing. But not a graceful thing.

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