Oil imports are CRASHING [1] (petroleum imports into the U.S. are down 9.1% this year, after an 8%+ decline last year) along with the value of the US$. Those g-d d*mn doomers might be right yet. We have real unemployment of 17% and $80 Oil. Who'd a thunk it?! In fact, if it weren't for the 6.1% increase in domestic production we would REALLY be in the soup. Thank goodness for some level of a free market.
This is serious. I have spoken about the "Incredulity Response" in the past. That's when perfectly normal people walk down into a burning subway platform and asphyxiate because they just could not believe what their own eyes were seeing.
The U.S. equity markets have not gone ANYWHERE in Australian Dollars, and are up modestly from the bottom in Euro's and Canadian Dollars. The sad truth is that our government is trying to devalue itself to prosperity, and while there's always a first... its never been done before.
Let me cut to the chase. The U.S. economy cannot withstand $80 - $100 Oil. Either Oil comes in or the economy sh*t's the bed. Simple. Like. That. How do people in Detroit pay their heating oil bills this winter with 22% unemployment and $100 oil[2]? (Even more unbelievably, I am citing NPR as a source. Good grief, what's next?)
Look for a massive double dip recession. Massive (or look for Oil prices to come in HARD). The U.S. economy is still utterly dependent upon Oil, and Oil DOMINATES our trade deficit. We all know that the US$ must seek a level that balances the current account deficit and our silly social program spending (and yes, I will admit, our outrageous military spending).
This is the SHOULDER PERIOD for Oil prices. Will they firm higher in the HEAD PERIOD? If they do, look out below.
For international investors the loss [in dollar value] is enough to offset this year's stock market gains. Not exactly great motivation for foreigners to keep buying the almighty dollar.
This is the SHOULDER PERIOD for Oil prices. Will they firm higher in the HEAD PERIOD? If they do, look out below.
Sounds like a meth-head trying to do Jim Cramer...and lo and behold: Bill Paul, formerly of CNBC...an 'energy and environmental reporter'?
There's more to the bit...
quote:
The key, in my opinion, will be to make your move before the media does its thoroughly predictable round of doom-and-gloom stories, thereby creating an echo effect that winds up depressing broad equities markets while raising energy shares. It's too late to act this spring, but if my theory is correct, there will be new opportunities every spring -- and, to a lesser extent, every fall -- for years to come.
How can an investor know when the time is ripe? The Amex Oil Index (Index: XOI) offers a clue. This year, it started shooting up right around Feb. 1, during the dead of winter, and didn't stop until nearly mid-March, just as the media was gearing up. If you are more of a seat-of-your-pants investor, pay attention to when your local TV weatherman starts counting the days to the official arrival of spring, or when major league pitchers and catchers report for spring training.
What should investors do? Well, if you buy into the argument that this situation is real and here to stay, the weeks immediately before the shoulder period could become a traditionally good time to buy oil marketers -- companies such as ExxonMobil (NYSE: XOM), ConocoPhillips (NYSE: COP), ChevronTexaco (NYSE: CVX), and BP (NYSE: BP). But heed this crystal-clear warning: Even if this logic does hold, a host of factors -- ones that could undermine this strategy -- work into determining stock prices when all is said and done. In other words: Tread carefully.
So make your move before his old buddies at CNBC start selling short. Great advice.
quote:
For international investors the loss [in dollar value] is enough to offset this year's stock market gains. Not exactly great motivation for foreigners to keep buying the almighty dollar.
Sorry...I don't think I have any tears left to shed for those poor, poor foreign investors buying up cheap dollars that don't move fast enough for them.
Originally posted by billbright: The sky's falling... again?
Is it? Doesn't seem many are noticing it if it is.
Again I stand correct.
quote:
WASHINGTON – The number of newly laid-off workers filing claims for jobless benefits rose more than expected last week, after falling in five of the past six weeks, as employers remain reluctant to hire even with the economy showing signs of recovery.
The Labor Department said Thursday that new jobless claims rose to a seasonally adjusted 531,000 last week, from an upwardly revised 520,000 the previous week. Wall Street economists had expected only a slight increase, according to Thomson Reuters.
