Friday Outlook: Commodities, Emerging Markets

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Yesterday was pretty disappointing all things considered. A big rally fizzled even though indexes closed higher. The McClellan Oscillator showed things almost as short-term oversold as in February or March.

Support seems to be holding for many markets while commodity markets led by food and energy continue to sky. But, I add the usual caveat, the week’s not over.

My wife and I marveled just a few weeks ago when Lehman (LEH) CFO Erin Callan was featured in a large and flattering WSJ story featuring her good looks and personal clothes shopper. Given LEH’s problems then the piece seemed unseemly. Now she’s been taken down a peg or two and might be shopping herself at Sam’s Club.

Don’t you find the congressional representatives downright incompetent and pandering?! Here we are with huge energy supply/demand imbalances and they want to discuss global warming and speculation in, as one put it “those dark commodity markets”. That’s because they’re clueless and mean to distract Americans from their poor stewardship of the country’s energy policies—and this doesn’t even include ridiculous agricultural policies. I’m going to leave you with this quote from a man I admired many years ago. He was the right man for the job then and his prophetic words ring true today.

With every passing day, the specter of an energy crisis in this country looms larger and larger. The privately owned sector of this country’s energy industry states flatly that there is a problem, that it is continuing to worsen and that the nation will soon be on a collision course with a major energy shortage. Despite claims by some environmentalists that the industry sources are over-emphasizing the problem, there is now general agreement that domestic supplies of natural gas will begin running out in ten years, oil in thirty years, and uranium-235, the basic fuel for nuclear power, in thirty years. When this happens, the United States will become totally dependent upon foreign sources for these fuels. We would be at the mercy of foreign powers who would be in a position to jeopardize our way of life, our industries and our national security.
Statement on the Senate Floor
March 22, 1973
US Senator Barry Goldwater

Have a pleasant weekend.

Disclaimer: The ETF Digest maintains positions in TLT and TBT.

Comments

[Gerry Sullivan:]

Lehman should be allowed to fail, I totally agree. I would guess that the Fed has Warren Buffett lined up to take out LEH some weekend for $2, the Fed's favorite number.

You can rest assured that Warren's lawyers will be more careful about the details than JPM's. Remember how the errors in the Bear Stearns weekend $2 deal enabled management to push the deal up to $10.

2008 Jun 13 07:53 AM

[jjc7477:]

It's extremely disheartening to see the lack of direction by the idiots who manage our country. So much time is wasted on their reelections or finger pointing at the opponents across the aisle, that nothing EVER gets accomplished. It will not be surprising to me to see uprisings throughout out nation in the next few years as more and more of our middle and lower class are forced to the brink of poverty and beyond. When that happens, woe to the those in office.

2008 Jun 13 10:24 AM

[bill d:]

Yeah - we'd be building guillotines now but the treehuggers won't let us.

2008 Jun 13 10:39 AM

[JimG:]

The Nov. elections will be the most important since we elected Ronald Reagan. We have no Reagan running this time but we must elect the most fiscally conservative candidates for all offices or we will lose what is left of the enterprise system which has served us so well.

2008 Jun 13 10:56 AM

[mythoughts:]

I am proud to say that I voted for Barry Goldwater for president many years ago I think in 1964.

2008 Jun 13 01:04 PM

[knight722:]

The quote from Barry Goldwater is strange in that none of his predictions came true.

2008 Jun 14 01:58 AM

[David Fry:]

How "strange"? His basic predictions came true.........we started to run out of energy and became dependent on other countries for energy. You must have read the name with partisan glasses but not the message. What a disappointing comment and that's why we are in the situation we're in--too much partisanship.

2008 Jun 14 05:14 PM

[dtrader:]

David, a poor choice of individuals to quote from and claim he was prophetic. In '74 the country was in the crux of a gas/oil crisis with the Middle East and it wasn't particularly prophetic or enlightening all you had to do was ask any Joe Q citizen in the street and he would have told u as much also. These problems were well known way before those times too it just becomes headline news when matters become extreme like currently and then.

Anyway, I agree with u just not the quote or the use of it.

I just hope in the future i don't read articles with u quoting Bushisms and saying how prophetic he was....

Regards...

2008 Jun 15 10:54 AM

[David Fry:]

The quote was in 1973 not 1974. I guess one can't use a Goldwater quote for partisan reasons one assumes. Your logic is missing.

I'll quote whomever I want that's truthful and prophetic--even Bush. You're not required to read it.

2008 Jun 15 11:53 AM

[dtrader:]

Grow up David...

BTW the the gas/oil crisis was in '73 and '74

2008 Jun 15 12:31 PM

[pchris:]

Hey User, please do not trash this investment site with meaningless diatribe. Now kindly move along and post elsewhere.

2008 Jun 15 01:01 PM