July 2011 Was A Good Time To Buy Italy's Debt: The Euro Prevails, Get Used To It [View article]
Correct, but Italy is not Spain or Greece (or Cyprus), and of course the mess is huge
Just the world is not ending and I hate to say it but QE-Whatever seems to work as a keep-you-alive mechanism for the heart-attack caused by the bad habits of the past.
Of course, telling people they can eat junk food as long as they want so long as they carry a portable fibrillator with them is not good medical advice.
I forgot to tell you that there was an article in my local rag (I live in Dubai) about some Brits of the "complaining variety" who went out to buy gold bars when the "price" was $1,400. And everyone was "out of stock"...they were asking...can't "someone" force those scoundrells to sell the real thing.
Military cuts are no threat to America, you guys got suckered into Afghanistan, and you increadibly blundered into Iraq which was a case of geographic dyslexia, actually George.W, wanted to invade Iran but he got confused....$3 trillion dollars of national debt later...Errr...Uh
Don't over estimate how scared the rest of the world is of American "Can-Do-Military-Power" (by the way they got the French to bomb Tora Bora, they had the technology), you ran away in Iraq and you will run away in Afghanistan...with your tail between your legs.
But don't under-estimate the affection and the respect that the rest of the world has for the part of America which is not doing the Rambo Thing.
I agree. The existence of a paper-market for gold where supply can be expanded suggests (1) market disruption (2) the idea of a "gold standard" is out of touch with reality, unless paper-gold is banned. I agree also that in that scenario real-gold is probably selling at a discount, although that doesn't mean you will be able to cash that in.
Bubbleomix Says Gold Bottomed On 4th April 2013 And Now It's Headed To $1,800 [View article]
Quite so...I'm not a Guru I do models, sometimes the models are wrong, that line of thinking was obviously wrong.
That said I still think that the low yields are artificially created and they represent a bubble, if that's right at some point yields will go up a lot, no idea when
Bubbleomix Says Gold Bottomed On 4th April 2013 And Now It's Headed To $1,800 [View article]
What the article says is IF the Model is correct THEN (a) the bottom was 4th April (b) over the next 18 months Gold will head up to $1,800; and IF IT DOES NOT...THEN the model is wrong
Tourism Booms: Why Starwood Bounced Twice As High As The S&P 500 Since March 2009 [View article]
If wanted my opinion on what to do today, I'd tell you SELL wait for the next 10% reversal in the S&P 500 which I expect within the next three months, then BUY
Yeah that was just assuming that (a) the Bomb-Iran brigade got their way, and (b) the Iranian Sunburns worked as designed, and they closed down 25% of the worlds oil supply, including the SPM's in Fujairah
Think about it, the 2% drop or so in oil supply the Libya conflict caused, replaced by increased production by KSA added $36 to your "Stress Index", so muliply that by 10 and you get about $550
In other words, I don't think bombing Iran just in case they might be thinking about developing nuclear bombs that they might deploy offensively (i.e. before being attacked), on someone who might bomb them for thinking that on the off-chance that the Sunburns didn't work, would make any more sense than invading Iraq a second time just in case they might have developed some "more" WMB,
I was wondering where you went, been on holiday or something? I don't know where you got $550 oil in 2020, on the chart here the "fundamental" according to me is the flatish purple line that if you extrapolate gets you to about $100 Brent in 2020.
I'm saying Brent should be about $85 today without any "Stress Premium", so if you say that's $12 today that's $97 Brent, personally I think Brent should be slightly less than WTI and the reason it's not is about the fact that crude is having production problems and it's now a bad benchmark.
So, I don't think we disagree much, except of course on the issue of whether or not we disagree
My thesis is that (a) there IS a fundamental just it's hard to spot (b) when markets get distorted they osscilate around the fundamental (c) the timescale for that is a function of how long it takes mal-investments to bite, causing the bust, and then...how long it takes for the market to clear after the bust. In the little pool I swim in, prices for some oil-services I know about doubled since 2009, people are investing like crazy helped by the fact that other sectors are still in clearing. I reckon the increase in oil production in USA had a lot to do with the price, at some point though there is the danger of what happened when North Sea oil came on line.
My point is that there is a probably a bubble, and just like most bubbles, no one sees them, if I'm right then expect a bust, simple as that. The discussion is about valuation, what is the correct price? When markets are in disequilibrium, like what happened in the housing bubble, people don't pay the correct price, they pay more, but long-term that is not sustainable, the way to tell, on the previous trip up to $140 then down to $35 is that a characteristic of bubbles is that the oscillation is around the correct price, if after things calm down, where price seems to end up is about the square-root of those two numbers that's a sign, all that says is that the departure above is equal to the departure above. Anoother clue is that in totallity no one makes mmoney from bubbles and busts, some people paid too mmuch, some paid too little, in the end it was just a transfer of wealth from losers to winners and no economic value was created. This is not the first time I have made predictions based on this type of analysis, if you look you will see I predicted in January 2009 that the S&P would bottom at 675, it did, then I predicted iit would go to 1200 before reversing, t did, the model worked...so did the model for house prices in USA, US Treasury Yields, and when oil was at $40 last time, the model said is was heading to $90, it did. So the message is, keep an eye out for oil, it looks like a bubble now, and the "fundamental" or what International Valuation Standards calls "other than market value" looks like it's still about 3.3% x World GDP/Production. Have a look back next year, see if I was right.
July 2011 Was A Good Time To Buy Italy's Debt: The Euro Prevails, Get Used To It [View article]
Just the world is not ending and I hate to say it but QE-Whatever seems to work as a keep-you-alive mechanism for the heart-attack caused by the bad habits of the past.
Of course, telling people they can eat junk food as long as they want so long as they carry a portable fibrillator with them is not good medical advice.
Gold's Flash Crash: Bubbleomix Analysis [View article]
Military cuts are no threat to America, you guys got suckered into Afghanistan, and you increadibly blundered into Iraq which was a case of geographic dyslexia, actually George.W, wanted to invade Iran but he got confused....$3 trillion dollars of national debt later...Errr...Uh
Don't over estimate how scared the rest of the world is of American "Can-Do-Military-Power" (by the way they got the French to bomb Tora Bora, they had the technology), you ran away in Iraq and you will run away in Afghanistan...with your tail between your legs.
But don't under-estimate the affection and the respect that the rest of the world has for the part of America which is not doing the Rambo Thing.
Gold's Flash Crash: Bubbleomix Analysis [View article]
Bubbleomix Says Gold Bottomed On 4th April 2013 And Now It's Headed To $1,800 [View article]
Bubbleomix Says Gold Bottomed On 4th April 2013 And Now It's Headed To $1,800 [View article]
Bubbleomix Says Gold Bottomed On 4th April 2013 And Now It's Headed To $1,800 [View article]
That said I still think that the low yields are artificially created and they represent a bubble, if that's right at some point yields will go up a lot, no idea when
Bubbleomix Says Gold Bottomed On 4th April 2013 And Now It's Headed To $1,800 [View article]
Bubbleomix Says Gold Bottomed On 4th April 2013 And Now It's Headed To $1,800 [View article]
Tourism Booms: Why Starwood Bounced Twice As High As The S&P 500 Since March 2009 [View article]
Evidence Oil Is In A Bubble [View article]
Think about it, the 2% drop or so in oil supply the Libya conflict caused, replaced by increased production by KSA added $36 to your "Stress Index", so muliply that by 10 and you get about $550
In other words, I don't think bombing Iran just in case they might be thinking about developing nuclear bombs that they might deploy offensively (i.e. before being attacked), on someone who might bomb them for thinking that on the off-chance that the Sunburns didn't work, would make any more sense than invading Iraq a second time just in case they might have developed some "more" WMB,
Evidence Oil Is In A Bubble [View article]
I was wondering where you went, been on holiday or something? I don't know where you got $550 oil in 2020, on the chart here the "fundamental" according to me is the flatish purple line that if you extrapolate gets you to about $100 Brent in 2020.
I'm saying Brent should be about $85 today without any "Stress Premium", so if you say that's $12 today that's $97 Brent, personally I think Brent should be slightly less than WTI and the reason it's not is about the fact that crude is having production problems and it's now a bad benchmark.
So, I don't think we disagree much, except of course on the issue of whether or not we disagree
Nice to hear from you, as always
Evidence Oil Is In A Bubble [View article]
In the little pool I swim in, prices for some oil-services I know about doubled since 2009, people are investing like crazy helped by the fact that other sectors are still in clearing.
I reckon the increase in oil production in USA had a lot to do with the price, at some point though there is the danger of what happened when North Sea oil came on line.
Evidence Oil Is In A Bubble [View article]
This is not the first time I have made predictions based on this type of analysis, if you look you will see I predicted in January 2009 that the S&P would bottom at 675, it did, then I predicted iit would go to 1200 before reversing, t did, the model worked...so did the model for house prices in USA, US Treasury Yields, and when oil was at $40 last time, the model said is was heading to $90, it did.
So the message is, keep an eye out for oil, it looks like a bubble now, and the "fundamental" or what International Valuation Standards calls "other than market value" looks like it's still about 3.3% x World GDP/Production.
Have a look back next year, see if I was right.
Evidence Oil Is In A Bubble [View article]
Evidence Oil Is In A Bubble [View article]