logicalsinger

Oil Bubble: How Speculation May Contribute to Recent Moves in Oil Prices

I don't buy your argument at all. Most of the surge from $60 to $125 occured after the Fed started slashing rates. There is a high probability therefore that this is a speculative bubble, unless you believe in the uncanny coincidence that demand/supply deteriorated at precisely the same time as the Fed cuts.

The price of oil is highly manipulated. Not a week goes by without news of production problems in Saudi and Russia. And guess who is giving us this news: the Saudis and the Russians.

Speculators should be banned from the commodities market. It is really a disgrace that people would jump ahead of buyers who really need a product, just to make a buck. Think of food commodities, now out of reach for many families in other countries, while the fat cats at hedge funds get fatter. Shameful.

Time to Buy Gold

I am with you. I think we may see $2,000 within 12 months. Inflation is out of control, especially at the PPI level, now at 7% and rising.

A Sideways Market For the Next Decade?

Cam, I also disagree but in a different way. I think stocks will be lower 10 years from now, not sideways. The current market is supported by a commodities/cyclical bubble and as you pointed out correctly, the market PE does not account for cyclicality right now, and is too high.

Saul (Crossprofit), your analysis is correct except for the fact that most stocks trade at a significant premium to book value already. During inflationary times, there will be goodwill compression even if book value grows, resulting in an overall decline in market cap for most companies.

The Fed's Secret Guests

Fedhed you are not entirely correct. The info below is from this website

www.federalreserve.gov...

Who owns the Federal Reserve?
The Federal Reserve System is not "owned" by anyone and is not a private, profit-making institution. Instead, it is an independent entity within the government, having both public purposes and private aspects.

As the nation's central bank, the Federal Reserve derives its authority from the U.S. Congress. It is considered an independent central bank because its decisions do not have to be ratified by the President or anyone else in the executive or legislative branch of government, it does not receive funding appropriated by Congress, and the terms of the members of the Board of Governors span multiple presidential and congressional terms. However, the Federal Reserve is subject to oversight by Congress, which periodically reviews its activities and can alter its responsibilities by statute. Also, the Federal Reserve must work within the framework of the overall objectives of economic and financial policy established by the government. Therefore, the Federal Reserve can be more accurately described as "independent within the government."

The twelve regional Federal Reserve Banks, which were established by Congress as the operating arms of the nation's central banking system, are organized much like private corporations--possibly leading to some confusion about "ownership." For example, the Reserve Banks issue shares of stock to member banks. However, owning Reserve Bank stock is quite different from owning stock in a private company. The Reserve Banks are not operated for profit, and ownership of a certain amount of stock is, by law, a condition of membership in the System. The stock may not be sold, traded, or pledged as security for a loan; dividends are, by law, 6 percent per year.

The WSJ Is Wrong on the Housing Crisis

stu, that is hilarious! He better hope the crisis is over with these positions

The 'Death of Gold' Revisited

Roland, this is very useful to know, thanks. I just hope we don't see a 58% decline this time, even if it is followed by an 8-fold increase.

Fed Delivers a Steep Yield Curve: A Bull’s Best Friend

It is USUALLY true that a steep yield curve is a bullish signal, but USUALLY the Fed does not lower short-term rates while inflation is making new highs. This time it is different (!) because the Fed has ignored inflation which is running at 7 to 8% and has cut rates to save the financial system. The result will likely be that inflation will accelerate and long-term yields will rise to higher levels. And we all know high inflation is bad news stock returns, especially in real terms.

Gold as an Investment? Think Again

Yellowstone, "Dr. Gold", I like that, brilliant! When people wake up to the wreckage left by maestro Alan and now mismanaged by unlucky Ben, gold will zoom ahead again.

What’s Behind the Slide in Gold and Silver?

awesome picture of Paulson, Bush and Bernanke! Sums it all up nicely. Wall Street and Big Oil are pleased with the Fed.

Gold as an Investment? Think Again

I will write you from Monte-Carlo while you burn your stock certificates to keep warm :D

Gold as an Investment? Think Again

I don't need to make bullets. Unfortunately, there are already billions of them sitting in the world's military arsenals. I would venture a guess that there are several thousand bullets sitting in crates around the world for every man, woman and child living today. Not to mention that sadly, there are more efficient ways for armies to kill today.

Re the total quantity of gold, you are wrong. There are many estimates, many of which indicate all the gold ever mined would fit in a cube 100 feet x 100 ft x 100 ft. No one knows for sure, but if anything, 3 football fields is on the high side. The total gold ever mined is estimated at 145,000 tonnes, equal to $4 trillion in value for gold at $1,000. Note in comparison that the S&P 500 has a total market cap of 12.6 trillions. So imagine the flight to gold that may take place if the equity culture vanishes for 10 or 20 years.

Finally, gold is one of the few things that are indestructible. Rare, indestructible, and also pretty to look at. Much better than most stock certificates :)

Gold as an Investment? Think Again

The lead argument is silly. There is plenty of lead around whereas ALL of the gold EVER mined probably fits on 2 or 3 football fields.

Gold as an Investment? Think Again

The main weakness of your article is that your opinion is highly influenced by the last 30 years, a very short period in human history which was very unique. Your optimism is also conditioned by the last 30 years with its technological advances, peace etc. There were unfortunately many many darker periods in human history. There are many extreme challenges ahead in terms of peace, economy etc. and gold will probably hit $2,000 before the year 2015 in my view.

Are Consumers Finished... This Time?

In the end, people have to pay their credit card bills. A small percentage will continue to spend and then default. But most will adjust their spending accordingly if their house prices or incomes fall. And I don't agree that "it's time we admit that nothing will ever stop the American consumer." That has been true for a long time, but nothing lasts forever.

The Week Ahead: The Fed Will Not Cut

The Fed is terrified of surprising Wall Street negatively. So even though I wish you were right, I think they will cut by at least 25bps.