Blutown

What's the Right Price for Oil?

Not one person has mentioned the greenhouse gas emissions regulations that are virtually guaranteed by the next president, congress and Kyoto successor treaty. Long term, oil price will and should go up significantly.

U.S. Housing Market Forecast: 2008-2010

I would like to share a few observations/opinions.

First, it appears that this article is addressed to the real estate investor. An investor looks for buy opportunities not when prices have hit bottom but when it appears there is a reasonable chance for appreciation. Until that time, investors will put their money to work in other investment vehicles that will provide the returns they are seeking.

Second, the individual home buyer doesn't necessarily need to wait for the absolute bottom because their motivation can be very different such as life changes (household formation, retirement, job relocation, etc.)

Third, the data presented appears to be the US overall. Remember that real estate is location sensitive and the "bottom" will occur in different places at different times.

Finally, if the bottom is in 2011 and I have every reason to believe the data presented, it means huge additional losses in equity. Can you say massive bankruptcies for homeowners and the businesses and governments that rely on the revenues?

The Great Oil Deception: Part Three

Thanks to all of the posters for being more informative than the original author!

North America and the World will never run out of oil, it will just be too uneconomical to bring to market. Big Oil has already figured this out and that is why relatively little investment has been made despite government incentives for exploration. But don't take my word for it, listen to what T. Boone Pickens is saying these days.

Our reaction to the dramatic increase in oils prices is akin to a junkie realizing that he/she is too broke to afford the next hit. We are too stoned and/or desperate to fully understand the predicament we are in. To me, this is the true "great oil deception".

A Look at the Respective Rallies in Tech, Housing and Oil

A couple of other things to remember about oil vs. other markets. First, oil is an international commodity for which the US competes against growing demand. The Saudi's more or less said this when saying that they would increase production when their "customers" demanded it. Classic sellers market.

Second, oil does not operate on a true free market basis. Although OPEC has lost a lot of its influence, the price and supply are manipulated by a few select parties. For there to be a bubble to burst, supply would have to be loosened allowing prices to decline. Again, the Saudi's made it clear that they are satisfied with both supply and price. On the demand side, short of a world recession or other major event, demand isn't likely to fall far enough to cause a bust.

Price fluctuations are likely to occur but a bubble bust is unlikely due to the unique dynamics of this issue.

Robert Shiller on America's 'Speculative Culture'

Speculation is normal human behaviour without question. What worries me is speculation on basic human necesities: food, water and shelter. I'm not saying it hasn't or won't happen, just that is has profound societal consequences that we need to be prepared for (which I don't believe we are).