A short and long term focus on oil and the conventional markets
Rick and I chat about his outlook for oil (the largest mover on our screen at the time of recording) and the conventional markets. While Rick continues to believe we are in a deflationary environment that does not mean immediate falls in the markets.
Sorry for the poor sound quality. We have edited the sound post interview butt his was the best we could do.
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I’ not sure. I am seeing food in the vegetable bins as Rick described, broccoli is down about 50% from last year, 49p for a decent piece of broccoli – at one point last year it was 1.15 GBP. I think 0.49 GBP is the price of 5-10 years ago. Broccoli deflation!
Also my energy bills are not up for about 3 years. Insurance is always going up but I think that is because of systemic risk, not inflation. Taxes are up of course, as always.
I am not so sure on the inflation argument. The jury is out right now. Seven years of near zero US interest rates and hardly any inflation. It ‘should’ be roaring.
Jim Cramer also said oil would bottom at $43
You have to take into account the depletion of the current operating wells over the rest of the year.
True, fracking is becoming cost prohibitive as oil falls, but Iran’s oil will be coming on the market full throttle, and if things ever calm down in Libya you can add some more. Likewise for Northern Iraq in the land of the Kurds. Fact is, oil prices skyrocketed when Bush and his cronies decided to blow up Iraq; before that, oil was struggling to get above $30. What a difference it makes when you destabilize the Middle East. The difference is that the Texas oil patch got rich and Main Street got screwed–as if Wall Street banksters weren’t enough!
Paul_L, The Market is assuming that the Iran Treaty will be ratified, and is anticipating substantial oil out of Iran.
It doesn’t matter if we ratify the treaty–the other super powers will walk away from the embargoes regardless–and oil is a global market. So I ask you, as we going to blow up tankers flying Russian or Chinese flags. Obviously we won’t attack the tankers of our NATO “allies”. What we see on talk TV and in on the floors of the House and Senate is simply a bunch of bluster–hubris at best, but mostly nonsense.
We are seeing inflation of 5-10% at the consumer level…aside from Oil, Cory. The majority of this money printing inflation is, however, the stock bubble….look at the p/e ratios on the biggest companies- the “lunatic stocks” as rick says…do you think amzn or nflx would be where they are without institutional money?