Oil Archive

2008-01-21 Update

Major themes intact: weak economy higher prices Weakness: US demand soft but supported by exports. US export strength resulting from non resident ‘desires’ to reduce the rate of accumulation of $US net financial assets. This driving force is ideologically entrenched and not likely to reverse in the next several months. In previous ...Read More

Why I expect US exports to continue to be very strong..

The desire to accumulate $US financial assets has been diminished for at least the following reasons: Treasury policy – Paulson is actively pushing both a strong yuan and threatening any other CB that buys $US with the label of ‘currency manipulator.’ CB’s had been perhaps the largest source of $US financial assets ...Read More

ECB Mersch on inflation

ECB’s Mersch Says Oil Must Not Boost Other Prices by Simone Meier (Bloomberg) European Central Bank council member Yves Mersch said a surge in oil prices must not be allowed to lead to permanently faster inflation, Luxembourg’s Wort newspaper reported, citing an interview. Yes, that is the mainstream view – don’t turn ...Read More

Saudi production up a tad

Saudi production increased marginally for January, and all indications are net demand is holding up at the higher prices. While this bodes for continued price hikes, markets may have likely sold off on the news, believing the higher production is a sign of a proactive supply increase that will drive prices down. ...Read More

The subprime mess

On Jan 5, 2008 9:40 PM, Steve Martyak wrote: > http://www.autodogmatic.com/index.php/sst/2007/02/02/subprime_credit_crunch_could_trigger_col > > > also…. > > 9/4/2006 > Cover of Business Week: How Toxic Is Your Mortgage? :. > > The option ARM is “like the neutron bomb,” says George McCarthy, a housing > economist at New York’s Ford Foundation. “It’s ...Read More

Crisis may make 1929 look a ‘walk in the park’

Crisis may make 1929 look a ‘walk in the park’ Telegraph by Ambrose Evans-Pritchard As central banks continue to splash their cash over the system, so far to little effect, Ambrose Evans-Pritchard argues that things risk spiralling out of their control Twenty billion dollars here, $20bn there, and a lush half-trillion from ...Read More

Calories, Capital, Climate Spur Asian Anxiety

Higher oil prices mean lower rates from the Fed, and higher inflation rates induced by shortages mean stronger currencies abroad. Why do I have so much trouble getting aboard this paradigm, and instead keep looking for reversals? Feels a lot like watching the NASDAQ go from 3500 to 5000 a few years ...Read More

Italian budget deficit down towards 2%

Falling deficits in general in the Eurozone due to the growth rate of GDP combined and the countercyclical tax structure. Aggregate demand from non government credit expansion (and some from exports) is supporting GDP as support from government deficit spending wanes. This can go on for quite a while as consumer leverage ...Read More

gas demand +.9%

Give Saudi/Russians comfort that they can keep hiking. And markets say Fed will keep ‘accommodating’. So much for higher prices curbing demand! DJ US Gasoline Demand +0.9% On Week – MasterCard SpendingPulse(DJ) NEW YORK (Dow Jones)–U.S. gasoline demand for the week ended Dec. 21, measured by purchases at the pump, rose 0.9% ...Read More

Saudi/Fed teamwork

Looks like markets are still trading with the assumption that as the Saudis/Russians hike prices the Fed will accommodate with rate cut. That’s a pretty good incentive for more Saudi/Russian oil price hikes, as if they needed any! Likewise, the US is a large exporter of grains and foods. Those prices are ...Read More