[6:30am ET] It is unfair of me to lay the blame of the global economic and financial woes at the feet of the Big Three US banks, as I did in the Week In Review. All the money center banks of the world are to blame, and the equity markets have shown them an appropriate response.
Last week, the average loss in share price of Bank of America, Citigroup and JP Morgan was -35.0%. But, UK
Sector Perform Risk Ranking: Caution Warranted Target 2.25($C) Q4/08 Production Dipped More Than Expected ? Western Goldfields reported lower Q4/08 gold output than Q3/08 due to slow leaching, accordingly costs were also higher than expected. What It Means ? Western Goldfields forecast less production for Q4/08, but it came in below guidance at about 30,500 oz versus the planned 37,000 oz. ? Production is still planned to ramp up to 175,000 oz by 2010 with 145,000 oz forecast this year. Costs are expected to include inventory adjustments from the heap leach operation this year. ? The non-cash inventory adjustments have… Read more »
http://tinyurl.com/8vvago
Unfortunately, the giveaway will continue. One investment professional emailed me:
“As if the taxpayer has any say in the matter — he doesn’t.”
Of course as I write this, March 09 oil is down $3.30 to $39.25…something to do with a lot of full crude oil tanks in Cushing, Oklahoma.
Here’s a nice graphic posted in an article on oildrum.com (original source: CERA) that encapsulates current oil production costs vs. the production volumes and regions. Hard to describe, you just have to see it. It backs up what Bill says – in not too long, the world will only be producing 45 mbpd if oil stays at $30/bbl.
http://tinyurl.com/7d3roe
Great picture, davefairtex! Even if US will face another 10 years of economic difficulty (the pessimists say that once deleveraging starts, it tends to run for many years with consumers becoming more and more frugal), the Asian economies will keep expanding (their savings rates are very high now and hence motivate consumer and government spending). Hence, I really don’t expect the world oil consumption to fall more than a few percentage points from peak to trough (which is in line with EIA predictions). Therefore, even if the last most expensive 10 mbpd are cut off from the world, the oil… Read more »
It was from a guest posting by Nate Hagens entitled “Yes We Can, But Will We?” and it discusses a Net Energy cliff we’re slowly approaching, due mainly to steadily increasing costs for energy exploration and production. New oil is harder to find, comes in smaller quantities, and is more expensive to produce. At the same time depletion (like rust) never sleeps. http://www.theoildrum.com/node/4957 The first bits of oil off the lifeboat are the tar sands of Canada. Between OPEC cutbacks, Mexico and Russia depletion, and the tar sands shutting down, I’m going to agree with you that even the gradual… Read more »
“Net exports are the important thing, since the US is an oil importer, and it will be a fall in global net exports that will cause oil prices to spike again.” Exactly! I remember an article by John Mauldin, where he mentioned that oil exporting countries will become net oil importers much faster than we think — their oil production will keep declining while their internal demand will keep growing. So long term (say 10 years) John Mauldin thinks oil is going MUCH higher than the recent peak we saw in July. His analysis seems very logical to me and… Read more »
A contributor to oildrum came up with a model that describes the phenomenon, called the Export Land Model. In the model, Export Land’s consumption grows quite rapidly, perhaps at 5% per year. This is because Export Land subsidizes oil prices – Saudi and Mexico both do, for instance. That rate of consumption growth is fine, until the peak oil production for Export Land is reached – as is in the case of Mexico. Mexico has peaked. At that point, oil production drops by 6%, consumption continues to rise at 5%, and so net exports fall off at a much more… Read more »
Still holding this – almost my best performing position over the last month or so (excluding some Uranium stuff). Haven’t heard anyone discuss this but Bill Gross believes that when Bernanke says “long-term treasuries, he means 2,5, and 6(?) year treasuries”:
http://www.pimco.com/LeftNav/Broadcast+Center/Bill…
BTW, how can anyone watch CNBC? These people are crazy!
Note; as requests for help on this tool have come up several times in the last few weeks it has been added to the “Help” section. Direct link below or go to the home page top menu bar “Site Index” >> “Website Help” >> “RSI Tool” Many many thanks to Korvus for creating and hosting this tool. http://caracommunity.com/content/rsi-tool Note in the RSI program the button “Set to Cara 100” is the old list, however as it is complied into the program source code it is not easy to change and Korvus is very busy with other projects at this time.… Read more »
Quasi, just a reminder to those using Safari that this won’t work for you, you will have to have a text list to paste into the input box.
cheers, doug
Thank you for the heads up on UUP !
Bear E
We’ll have to deal with prices when we see them move. But I will be on heightened alert if the DOW stays below 8200 for 48 hours.
Do the opposite…..Short it…TEQUILA !
🙂
http://tinyurl.com/844bcy
The Obama Inauguration Rally is in deep trouble at this point in the trading day. The major Asia-Pacific equity markets are each down over -3%, and traders there have been spooked by the Bank of Japan Governor’s comments (which I thought were remarkably honest) and by the plight of HSBC, Royal Bank of Scotland and Barclays. Well, it’s one thing to forecast, and another to trade. Let’s see how the post-holiday session works out.
Too much negative news. Too much hope placed in one man. Too much pain inflicted in such a short time. Too much trust maltreated. Too much incompetence exposed.
Disclosure: Maximum powder dry.
I am intrigued that Warren Buffett, who was strongly advising mom and pop to throw caution to the winds and buy stocks a few weeks ago, now says we’re experiencing a financial and economic “Pearl Harbour” (ie, a sneak attack) and are “at war” but that “we will win.”
Something to contemplate.
Duh, Thanks.
I guess I’m a bit slow today.
Probably not much of a surprise to some of us…
A brewing fraud scandal at the Treasury Department may be worse than officials originally thought.
Investigators probing how Treasury regulators allowed a bank to falsify financial records hiding its ill health have found at least three other instances of similar apparent fraud, sources tell ABC News.
In at least one instance, investigators say, banking regulators actually approached the bank with the suggestion of falsifying deposit dates to satisfy banking rules — even if it disguised the bank’s health to the public.
http://tinyurl.com/8fmwz9
Thank you fireworks.
The sheriff has joined the rustlers.
Hide your women and children!
Thank you fireworks. This kind of news just makes me sick. It casts further doubt on the whole workings of the Treasury, SEC and Federal Reserve. Then it seems little is reported about the matter and that further erodes confidence in government and these institutions. Incompetence? Corruption? The shameful fact is that this entire U.S. congress and the congress from years back could well be in this category for having weakened the controls put in place after the great depression, bring us to this shameful destiny!
We can spend a lot of time trying to guess how low the oil price will fall before the new oil bull market starts, but the only reason a trader would do it, as I see it, is if he/she wants to buy oil at the exact bottom (or near it), which is a reasonable desire only if the trader has very little money to spend on the oil trade and can only allocate it in one shot. Otherwise, a fool-proof strategy to make some money on the oil price is to start scaling in now in small amounts. I… Read more »
I know. The market was closed today and I was off so I had plenty of time to theorize.
I really like your trading strategy. I’ve been tempted plenty of times recently to enter the oil trade on the long side. After we see what happens this week, I may scale into oil a little as well.
I guess for now I’m just too fearful too enter at this point.
Rob.
There is apparently a quite beautiful 40-page spread on Bahamas in the December issue of the French magazine GEO. If anybody can clip a few photos to show here, I hear they are breathtaking.
Tomorrow, my neighbours are holding a Bahama Mama for Obama Party. Starting at noon, it could last until Super Bowl. That’s one way to cut my workload!
Looks like all you can retrieve from their web site is the cover photo…but it’s nice. http://tinyurl.com/9f4p7s
The crude oil is down more than 5% today, so the buy limit order I already have for UCO at $10 should hopefully get hit tomorrow. I am also placing another buy limit order for the same amount of shares at $9, in case the oil plunges again tomorrow (and adds to today’s decline).
$20 oil, $750 Gold, sounds like good prices to go long with all this spending in the works. Will the USD continue to be bought as the banks go deeper. GG back to 19 or 20, USO well below 30. The next few weeks/ months could prove very interesting.
It looks like Europe is going to have to mortgage the next few genrations also.
Most all of the G 8 interest rates near or at 0. What would that mean??
Finger Lakes wrote: “I sincerely hope we move forward to a time where responsibility is encouraged, honesty is rewarded, integrity is coveted, and doing better than your peers means setting an example for others to follow rather than showing them the quickest path to the feeding trough.”
Hear, hear! Well said.
http://www.bloomberg.com/apps/news?pid=20601213&si…
http://tinyurl.com/63pymh
http://tinyurl.com/85zl3y From the Proshares website: “Objective ProShares Ultra Oil & Gas seeks daily investment results, before fees and expenses, that correspond to twice (200%) the daily performance of the Dow Jones U.S. Oil & Gas Index.” I am currently tweaking the time series indicators and studying the rally from March of 2007 to June of 2008. Another ride i missed; prob made some of you very wealthy. but hopefully with a better understanding of how oil stocks and DIG reacted then, i can profit on the next Oil bull run. History has shown that decision makers in power really do… Read more »
Hi All
Happy New Year
First Post here.
I am happy to see you all searching for the truth and intolerant of any more B.S.!!! The little guy, like myself, really appreciates the help.
I haven’t seen this thrown on the boards yet.
Sounds like GATA and James Turk are on this already.
http://emsnews.wordpress.com/2009/01/15/1961-top-s…
It’s a long read but I’d be happy to hear comments. There are later articles regarding this on the site as well.
All the Best
Flexi
Because N. American production is more costly, and may go offline with low prices, thus making US more dependent on foreign oil once again. Also, a low price eliminates incentive for alternatives, slowing progress in those areas (which are supposed to be a area of growth in the near future), and again, delaying energy independence.
The USD is currently up 1.39% today at 85.12.
I realize my thoughts about $10 oil seem absurd. But, I’m of the mind that anything can happen in this market, especially things that most people think could never happen.
Rob.
For someone who trades U.S. stocks and options only which broker do you think is the best and most cost effective. I’m leaning towards Interactive Brokers or Trade King. Thanks in advance to anyone who answers.
I’m not sure about costs but the best system to trade options has to be Think or Swim.